Investing in disruptive tech? Look out for these six things, says Kalon's Clive Butkow


You know for a fact that FinTech companies are shaping our future and you feel that your money can multiply if you only just invest in the right one. But how do you know which one that is? We chatted to Clive Butkow, the extremely experienced CEO of Kalon Venture Partners, and came back with six valuable tips from him.

First a bit about Clive. Here's a South African investment and business improvement expert who started his entrepreneurial career as an eight-year-old, when he started making kites and selling hundreds of them by going door to door. Here's an IT guru who qualified with a Computer Science degree, who wanted to launch his own computer business after graduating, but then spent the better part of his working career in top positions at Andersen Consulting - and subsequently Accenture - working in many of the top entrepreneurial ecosystems across the globe, from Silicon Valley to India.

"The most important skill for any entrepreneur is selling," says Clive, reflecting on his youth working in clothing stores and on his successful career that followed.

"Someone has to make the stuff and someone has to sell the stuff. If you can't sell what you make, you can't build a sustainable business. Nothing happens until the cash register rings. That is the advice I give to any startup. A founding team needs to have a founder that is the best sales person on the planet."

After three decades on the cutting edge of the corporate environment, Clive has finally returned to his entrepreneurial dream - in his case as a venture capitalist.

"It is incredibly exciting. I don't work an hour in my life, I rather have fun 14 hours a day. I enjoy helping build companies and mentoring people. That is what we need in this country."

What is Clive looking for in entrepreneurs, especially when considering investing in their firms? Clive calls it his six Cs to investing: coachability, charisma, courage, conviction, curiosity, and communication.

  1. Coachability: "One of big problems with entrepreneurs is coachability. How do you grow if you are not coachable? This is not age-dependent. Many entrepreneurs have a DYI attitude. They believe they know everything. They don't listen to anyone. They fall in love with their product. If I invest money, I want to know that I work with entrepreneurs who become leaders and start listening. A lot of people don't raise capital because they don't want to listen to anyone. Trial and error is a very expensive business strategy."
  2. Charisma: "You need to have charm and charisma to sell your idea, first of all to customers, but also to the press and your own employees and investors. You need to get the best talent and to attract them you need to convince them, so you are always selling."
  3. Courage: "People don't understand how hard it is to build a business from startup to scale up. It is easy to say you had enough and get a corporate job. They need to have the courage to terminate under-performing staff, which is never easy."
  4. Conviction: "Related to courage is the conviction to never give up. If you get told no, it means maybe. An entrepreneur is like a bulldog. The trick is finding the balance between stubbornness and conviction."
  5. Curiosity: "What are the trends happening in the market place? How many mobile phones do people have in Africa? To be a successful entrepreneur, you need to be a learner. If some development is happening further up the road and you don't pivot, you might be swallowed up alive. You need to be curious to stay future-focused."
  6. Communication: "Founders and specifically founding CEOs need to have great communication skills. They need to be able to articulate their vision to their employees, investors, partners, and other involved parties."

Kalon Venture Partners invests in and builds a portfolio of high-growth technology companies, with innovative business models, geared to existing and emerging institutions and their customers.

The fund has been set up under the Section 12J venture capital tax incentive, where investors receive a 100-percent deduction of their investment from their taxable income. Kalon's board and investment committee consists of tech leaders and entrepreneurs such as Gil Sperling, Gil Oved, Nic Liebmann, and Romeo Khumalo.

To date, Kalon has invested in cloud-based accounting software firm SMEasy, and SnapnSave, South Africa's leading cashback coupon app that gives shoppers cashback on their favourite products. Its current capital raising round closes on 30 September 2017.

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