Deciding to relocate to South Africa. Travelstart 10 years of (in)famous stories 12/30

 

A start up
company is like an extension of the founders DNA in dreams, aspi.jpgrations,
actions, the good sides and the dark sides. In Sweden a company receives a
registration number that has the same format as a persons personal id
DDMMYY-1234. The company is in fact from its inception a type of person. The
parents are the founders. The company will go through life like any person,
infancy, childhood, adolescence and so on. Or it can die due to lack of love,
care and nourishment, i.e. cash.

The traits
of the founders will become evident in the company. If founders are only
interested in money, that will become apparent very soon. If they are sloppy,
that will show. If they are insecure you will have an organisation that tip
toes around the managers who likes to keep things in the dark. In other words
it will all come out. So working on you is as important as working with the
company.

Our baby is
a curious little one, and she’s not afraid to take risks. I like to gamble in
business. I never cared much about short term but I’m curious for the long
term. That’s why there’s been a lot up and down these last ten years. Some
years we have zero growth and the next year we have two consecutive years of
close to 100% growth. Actually we are in such a  low phase now. Some would call it consolidation. I call it
fixing the shit. Perhaps not a ideal company to invest your money in if you
want to play it safe.

2003 and
2004 I was curious as ever but discontent with the status quo or something like
that. Something was pushing me. We decided to go for a 10-day family holiday to
South Africa. I knew South Africa well from before. I was the first in
Scandinavia organising trips to South Africa already back in 1989. A not so
popular venture, back in the embargo days, amongst the press, who decided to
hate my guts. During an Indaba conference in Durban in 1990 a man came and told
me I was on the ANC black list. To this day I still have no idea what he was
talking about. Nowadays ANC has no problem in using me as an example of foreign
companies who successfully invests in South Africa. And I don’t have a problem
with them using me. A happy couple.

I don’t
think our plane had more than hit the tarmac in Johannesburg before my wife
started to talk about the possibility to move to South Africa. I had no idea
what this would mean to the company. The family would do well, I didn’t doubt
that. But I was unsure about how this would affect the company.

Two days
later I started to SMS my right hand man, Sören, in Sweden what he thought
about me relocating and starting up in ZA. He told me to do my homework. I was
always a bit lazy, so I did a couple of phone calls. I called the manager for
Worldspan in ZA. One day he was out playing golf, the next day he left after
lunch. On the third day he was playing golf again. It took me a week to get
hold of him.  And when asking about
the business opportunities in South Africa his reaction was “the market is
saturated and consolidated. Done and dusted. There’s not more to be done.” I
made some calls to Lastminute.com and Travel.com.au who were also doing business
in ZA. They were both managed by large local industry players who didn’t seem
to have their heads in the game. I remember thinking; this will be like
stealing candy from a kid.

I was sms´ing
my so-called industry research to Sören and to my board. The board said that as
long as we could find someone to run the Scandinavian business it would be ok.

I was ecstatic
about the opportunities to launch in ZA and about finally emigrating from
Sweden to this utopi.jpgan beauty spot.

By the time
it was time to go back we had all mentally moved. I spent the next nine months
preparing the family and company for the move. I went back a couple of times to
start our legal entity, hire offices and do the necessary homework for the
launch. The board and me took all necessary precautions for the move.

The most
important thing was to find a new CEO to take over after me. We met with three
possible candidates and decided to go with one of them. He came on board on June
1St and was laid off six weeks later. My right hand man decided
reluctantly to take the job. I should have listened better.

On December
1st of 2004 we landed and it didn’t take me more than a month to
realize that our South African Launch would be endlessly postponed. It took me
another couple of months to realize that my Scandinavia business was seriously jeopardized.
As great as we were as a team the same was also true on how bad we were when we
changed the management structure. The whole synergy disappeared and later we
parted ways. I still regret this.

We paid a
high price in relocating to South Africa and we are still paying for that
decision in form of lost market shares, lost edge in innovation and lost profits
and a high staff turn over in Scandinavia.

Our local
success in South Africa has to a certain extent made up for the lost business
and profits in Scandinavia. I am still betting long term that the relocation
will have an overall greater effect for the company than if we would have
stayed as a local player in the Scandinavian market. Luckily I only pay for my
own errors, some you pay in cash and some in lost relationships.

When people
ask me if I can recommend doing a move like this I would normally say no.

A start up
needs attention like a baby needs breast feeding, change of diapers as well as
love and intimacy. My baby wasn’t ready for this and we are still trying to fix
her. But it’s bloody hard to change what has once been broken. But there’s
nothing better than challenges, it keeps us young and vital.

Have something to say...