The world is changing fast and to keep up you need local knowledge with global context.
World Economic Forum founder Prof Klaus Schwab is justifiably proud of bringing together of the world’s political, business and civic society leaders in Davos. But his greatest achievement, he reckons, was launching the Global Shapers programme where young activists gather to do good through hubs in almost 500 cities worldwide. Every year a few of these Shapers – mostly 20-somethings – are invited to rub shoulders with the global power mongers gathered in Davos. A handful of them are invited to participate in the big name sessions. This year, their rarefied number included South African Matsi Modise, the 31 year old entrepreneur who started the Soweto hub. On Thursday, Matsi looked comfortable sharing the Davos stage with the chairman of Coca Cola; the founder of Airbnb; and superstar musician will.i.am. Today she shared her inspirational story and dreams for a future South Africa with Biznews.com’s Alec Hogg.
Alec Hogg is with South Africa’s young global shaper, Matsi Modise. Matsi, you’ve done a lot on a global shaping side and we know that Klaus Schwab calls it his biggest success. How did you get involved in the program?
I’ve been with the community, well Matsi Modise from the Soweto Global Shapers Hub, which is a community of the World Economic Forum. We are the youngest, it’s between 20 and 30, and its young people that have thrived in their various or respective fields.
You started the hub, now what made you do that?
I did. Initially I started at the Johannesburg Hub. I was nominated and I gladly accepted because I did want to be part of this global movement of young people and to be globally integrated and be part of the conversations also, the actions are required to actually change… The little we can do to change the world, so then after a year of being a part of the Johannesburg Hub, I was given an opportunity to start the Soweto Hub, so I was the founding curator of that, and this was two years ago.
How old are you?
A lady shouldn’t say her age but I don’t have any qualms with that, so this year I’ll be turning 32, so I’m currently 31.
You had to start while you were in your 20’s. That was really the point.
Correct so when I was the age of 29 – that’s when I was nominated into the Johannesburg Hub.
How are you allowed to carry on as a global shaper?
Well, either you can be here for five years or if you’re 33, then you have to exit, so next year will be my last year.
Before this, the first 29 years, what were you up to?
Well essentially, I was formally an investment banker I did that for two years. I realized that banking was not for me and when I quit that job, I did not go out and find another job. What essentially I wanted to do was to fulfill and pursue my purpose and passion. For the past six years, I’ve been an entrepreneur and an entrepreneur activist. I have my own company, Furaha Afrika Holdings. I was the national executive director of the South African Black Entrepreneurs Forum, and now I’m currently the managing director of SiMODiSA Start-Up, which is an industry association creating South Africa’s entrepreneurship ecosystem.
So an industry association – you go out there, and get members and speak for them.
Well, yes, we essentially are an advocacy group. We do speak on behalf of entrepreneurs and small businesses, similar to the South African Chamber of Commerce and Industry. However, we focus on small businesses and entrepreneurs, so we will speak on their behalf. Our focuses are policy review, policy recommendation, so we do have regular interactions with the respective ministries that oversee small business development. The Department of Science and Technology, the Department of Trade and Industry, the Small Business Ministry – we would regularly engage them. Small Business Industry – we focus more on high growth, high impact entrepreneurship, so it’s what you call the Gazelle Program that they’re in the process of establishing. It is important for us to support entrepreneurs that are in industries that are high growth and high impact because those are the ones that are going to contribute towards the economy and create the jobs that we’re looking for.
You say the Gazelle Program, two years ago the President of Korea who, like you, was in the congress hall here, telling us all about the way Korea is becoming a creative economy. They’re also looking at Gazelles. What exactly is happening in South Africa on this program? How’s it going to work?
Well, it hasn’t necessarily been implemented. We are regularly engaging with the ministry on how to go about supporting the Gazelles. You know, those entrepreneurs that start businesses that scale, you know within 18 months of existence, so at this point in time it’s still in the planning phase. We are hoping that the ministry will engage further with SiMODiSA because the entrepreneurs that we engage with are at that level. They are scaling. They are global. There are challenges that they are having in South Africa. It’s a function of how do we then engage the ministry to say that ‘this is their challenges how do we ensure that we put in the necessary policies or adjust the current policies that we have, to actually accommodate that to happen’?
Now, we are at Davos, you know the theme is the Fourth Industrial Revolution, which is underpinned by technology but now the question is how is South Africa supporting and creating an enabling ecosystem to actually support these technology entrepreneurs? The main issue right now is that we don’t have much of a venture capital industry in South Africa. If you look at progressive ecosystems, like Silicon Valley, Tel Aviv, there’s a lot of venture capital. There’s a lot of people putting a lot of money into seeding ideas. Right now the venture capital industry South Africa has essentially looking at post revenue entrepreneurs and ventures and not necessary those who have an idea. Like an Airbnb or an Uber, and those we do need to have South Africa contributing with it. It’s the public and the private sector coming together to contribute towards this venture capital fund.
We’ve got the brains. We’ve got the enthusiasm. We’ve got the enterprise. Why haven’t we been the people who created Uber, Google, Apple, Airbnb and so on?
Right now, like I said, there’s no venture capital. A lot of entrepreneurs complain about access to capital. I think it’s a global phenomenon but its worst in South Africa. There’s currently only 31 venture capital fund managers, and that’s a minuscule amount, relative to what we really should be having. The policies are also not encouraging. If you had to look at intellectual property, the reason why people like Mark Shuttleworth, Elon Musk had to leave South Africa is because we don’t necessarily nurture minds and ventures and ideas, such as those. So South Africa really has to reflect on what is it that’s stopping technology to actually take, because the Minister Patel yesterday spoke about a lot of inventions that were in South Africa but we, essentially are now importing those technologies.
We are not proud to say ‘this is what South Africa has done’ because a lot of them, like the Chairman of SiMODiSA that started SiMODiSA in 2013… He actually met Pravin Gordhan in San Francisco, and then he had to tell him about SiMODiSA that’s an industry association, but he was living in San Francisco for the past 12 years. He couldn’t scale Clickatell at the level that he’s scaled it now, if he was in South Africa, so there is a critical problem that we really need to address. The Government has to essentially engage the necessary, perhaps not necessarily the private sector but even civil society organizations or organizations on the ground that are engaging with technology. It’s not something that’s going to come from the top down. It has to be from the bottom up.
It’s interesting to see how many South Africans have done well in Silicon Valley and there’s another story.
Yes, no absolutely, so for us it’s how do we create that environment that’s going to allow young people to believe that they’re not going to be leapfrogging or catching up with the world, as young technology entrepreneurs but they’re going to lead this fourth industrial revolution. We can’t be leapfrogging. We can’t be playing catch up. We have to lead this revolution.
You’ve been leading or at least waving the South African flag quite proudly here in Davos.
Yes, I have. A lot of people are very receptive. It’s mixed emotions because I feel like there is potential, like we have not even touched it. I feel like there’s a lot more that South Africa could be doing at this particular platform. I feel like South Africa should be getting a lot of attention because of who we are as a nation and, also what we mean to the rest of the Continent but we have not necessarily leveraged that opportunity and I think great leadership will be required for us to essentially, when we get to Davos. The whole world will take us seriously because we take ourselves seriously.
Standing on those stages and rubbing shoulders with the good and the great, and talking to big audiences.
I was very privileged to be part of a panel here at Davos, whereby we had the chair and CEO of Coca-Cola, Mr Muhtar Kent. We had the co-founder of Airbnb and will.i.am from the Black Eyed Peas, so sitting in that panel as the only female, as the only African, I felt very privileged but I also felt that there has to be a strong message about we are not cap-in-hand begging. We are essentially we do have the necessary resources. It’s a function of how to we align ourselves, how do we work together, and how do we have the necessary leadership to actually take us forward? For me my biggest message was that Africans will be leading the fourth industrial revolution. There were will be entrepreneurs. We will support them. We will give them the skills, and the ability and skills of future jobs, and education is very important because it underpins it’s movements, so there’s a lot that we have to take back home and say ‘guys the education system is not necessarily producing jobs of the future’.
For 16 years you are in an institution that is teaching you something. You come out, you go out to university, you come out of university, and you don’t have a job because we have 25 percent unemployment. Clearly, there is something fundamentally wrong with how we are educating our young people and it is a ticking time bomb. If we don’t do anything about it, if we don’t involve passionate, young people, like myself, into these conversations. Passionate, young people that are on the ground, advocating and engaging with entrepreneurs and trying to build an enabling ecosystem, then there is something wrong with the leadership because we have to acknowledge who are the key stakeholders, including the youth that will take South Africa forward.
How do you engender the spirit of entrepreneurship? How do you get the entrepreneurs like yourself to become heroes in South Africa, moving away from everyone wanting to go into politics, but actually building jobs and creating companies?
A huge part of it is being honest about it because for the past ten years, entrepreneurship has been on everybody’s tongue, well perhaps seven or five years, but we have to be honest about the failure rate of entrepreneurs. We have to be honest about it does require a lot of work. It does require a lot of sacrifices. It’s not secure. Being in a corporate environment is obviously much more secure than… Well, it used to be secure because now everybody is actually shedding jobs but it’s not a space for everybody. It has to be for people that are resilient. It has to be for people that want to defy the norm, because we are not looking for more ‘spaza-shops’ in South Africa. We have more than enough. We need South Africans to innovate, to create things that are actually going to be African solution for global problems, so we are not looking for the next hairdressers.
We really need people that are going to be innovative, and our responsibility from SiMODiSA, from the Government and the private sector is how do we create that environment? How do we support them, so SiMODiSA’s big intervention is we have an ecosystem, so different stakeholders but we’re not correlated and that’s why it’s very difficult for us to measure impact – it’s very difficult for us to say ‘as a unit – as an ecosystem how are we going to reduce unemployment in South Africa’? How are we going to create jobs?
Are you able to take any of your contacts that you’ve made here, at the World Economic Forum and through the global shapers grouping or community back to South Africa to support?
That’s correct, so I’ve been engaging a lot of venture capital entities, people from Israel, people from the U.S., people from South America, and in creating this global venture capital industry I’ve met a lot of people that are actually going to be able to assist. Then also, I realize that, and the one thing that I take away from Davos is that I get to meet CEOs in Davos instead of South Africa. The access has been phenomenal. I’ve had one-on-one time with key CEOs from the banking industries, from the Industrial Development Corporation and these are the people that you would never, ever for the life of me, meet when you’re in South Africa, so Davos does create that access.
Matsi Modise thank you.
It’s a pleasure.
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