By: Tebogo Mokwena
A partnership between the corporate sector and SMMEs and start-ups can create sustainable solutions to grow businesses and the economy, according to former FNB CEO and venture capitalist Michael Jordaan. He told a recent webinar hosted by PSG Konsult, which is part of a series called the PSG Think Big Series, that the corporate and banking sectors must be encouraged to form these partnerships, especially in the innovative sector.
At the same time, he called on consumers to also consider using alternative solutions that were provided by small businesses and start-ups. According to Jordaan, start-ups and SMMEs were not taken seriously and the corporate and banking sectors would need to change their attitudes in order to see lasting solutions for the consumer. “Small businesses have superior offerings than what’s on the market, but they’re not growing as fast as I think they should,” Jordaan said.
He pointed out that, for example, banks could help retailers by making it easier for their customers. “Corporates should partner more with start-ups that do not have a legacy, with different types of cultures and that can come up with something beneficial for the markets,” he said. Jordaan also challenged the banking sector, saying it needed to lend more money to SMMES. “Looking back, I wish as a banking CEO that I could have lent more money to SMMEs because the capital that goes into small businesses will go a long way and make it easier for them,” he said.
Jordaan also said that if smaller businesses were given the right support from the banking sector, they would also be able to provide affordable connectivity options with the availability of spectrum announced by Communications Minister Khumbudzo Ntshavheni. He said that the availability of spectrum for smaller businesses would be cheaper for them, as they would not have to spend a large amount of money to upgrade. “If you have a radio network and double your spectrum amount, there is no need to expand a single rand, because all you do is double the data amount available for customers,” he said.
“It’s difficult as a small player to have countrywide coverage, so we are delighted that there is explicit pro-competition, which means that smaller companies could also compete for spectrum,” he said. Jordaan furthermore pointed out that consumers should also support SMMEs when looking for alternative solutions to problems like load-shedding or even banking. He added that the onus was on consumers to consider these businesses as viable options. “Consumers should also do things like to consider solar and a secondary account (from smaller businesses and startups),” he said.