Hi there,

Ever miscalculated your budget? Don’t feel bad, the ongoing FTX trial revealed a software bug in the exchange resulted in miscalculating $16 billion in liabilities.

In this Open Letter:

• Artisan focused: Fixing the right problems in SA trade.

• Tourism spikes, briefcase scooters & big exit returns.

• Poised to boom: Growth opportunities in electric cars.

• The results: Who’ll actually trade petrol for EVs.

• Share this: And get lekker free stuff.

TRENDING NOW

Fixing the Right Problem

Why you can’t just copy-paste service-marketplace apps in SA…

Every South African knows: Hiring a new tradesperson for maintenance is risky.

You never know what you’ll get – great service at a fair price, or a job that drags on for ages and maybe never gets done properly. Reports of corrupt installers and fly-by-night builders, plumbers etc. are as common as praise for the “good ones”.

And it’s an issue many local startups have tried to solve by building service-marketplace apps to the tune of “the Uber of home services”. GetTOD was probably the first major player here in SA (and they don’t seem to exist anymore), with many others following suit.

The issue? Perhaps they’re trying to solve the wrong problem.

Looking at the state of SA’s education and training for artisans, it might be less of a need to connect consumers with tradespeople, and more about helping more people in trades be more effective at their jobs.

Either way, there’s opportunity here…

SA needs more skilled tradespeople (and we know it)

The South African Development Plan (NDP) set out some ambitious developmental goals for 2030, including up-skilling way more artisans to support and drive the economy.

We are currently only producing 15’000 qualified artisans per year. That’s only 42.9% of the 35’000 per year that NDP 2030 requires – and we started implementing way back in 2012, sheez!

The demand is big

A subset of these skilled artisans that provide home services (such as plumbers, electricians, carpenters etc.) has seen a major increase in demand since Covid. Kandua, a home services digital platform, saw a 750% increase in demand for home services in just one year in 2021.

We don’t know the specific figures in this subset alone, but Statistica says about 3.3 million South Africans are employed in the trade industry – 79% of which are employed by companies, the rest either work for themselves or stay unemployed.

But the need is bigger

Now, those 600k-odd small-time “bakkie builders” often lack back-office support, capital and financing options. So you probably have a lot of these guys driving from one job to the next, living hand-to-mouth, having to do their own admin, quotes, invoicing, collections… It must be hectic.

And it might just be the source of all our frustrations.

Solving the right problem

If tradespeople can work more efficiently, plan better, service all their clients well and get paid without spending time on collections, chances are they can do more work, earn better and increase satisfaction.

Tradespeople don’t need more work, they need tech tools to help them work smarter.

And that’s where local solutions like ServCraft come in. ServCraft offers built-industry job management software that helps tradespeople plan and execute better. From the moment a customer reaches out, to creating quotes, job cards and invoices, wrangling customised forms, and streamlining comms between tradesman and customer. It’s the back office every tradey needs and, at a mere R260 per month, most likely one they can afford.

As a country, we might never end up qualifying 35’000 artisans per year, but with more tools that actually help tradespeople work more efficiently, we might not need as many.

OVER TO YOU

IN SHORT

👶 Baby Leave. A major South African court ruling stated that parental leave for natural births, as well as surrogate & adopted children under 2, should be 4 months in total and can be split between both parents in whichever way they see fit.

💰 Tech Revenue. All eyes are on big tech as earning reports of tech giants start coming in. Early signs of positive growth from among others Microsoft (13% YoY), Alphabet (Google) (up 11% in Q3 growth from 2022), and Snap (Snapchat) (5% in Q3 from 2022).

🏖️ Tourist Spike. Looks like the Western Cape is in for a bumper tourist season with Cape Town International Airport’s seat capacity expected to increase by 25% compared to last year – exceeding 1 million inbound international summer seats for the first time ever. Lekker man.

💼 Briefcase Scooter. Honda has just released the Motocompacto, a scooter that folds away conveniently into its own housing/body the size of a briefcase. This lil’ firecracker can reach breakneck speeds of 24km/h (in 7 seconds), and go as far as 20km carrying a sturdy 120kg user. Handy.

🇿🇦 Winning Travel. South Africa won big at the 2023 World Travel Awards. Awards include Africa's Leading City Destination 2023 for Cape Town, Africa's Leading Airport for Cape Town International Airport, and Africa's Leading Luxury Resort for One&Only Cape Town.

💸 Exit Returns. Some local VC investors cashed in (or took their losses, we will never know) in 2022 with exits in the investment space totalling R321 million for the year at an average of 3x return.

30-MINUTE PODCAST

Growth & Opportunities in Electric Cars

If our look at the prospects in electric vehicles got you excited, then this week’s podcast is for you. We sat down with Michael Maas CEO of Zimi who is making big plays in this space. You know, to pick his brain and see what they’re doing, what’s working and what other opportunities there are to get in early…

A few good highlights…

1. SA’s about 5–10 years away from full-on EV

Having gained a lot of experience in both the consumer and commercial/fleet side of things, Michael explains here that compared to Europe, SA seems to be around 5–10 years away from full consumer EV adoption.

Of the 12 million cars on our roads, only 0.02% (2’500-ish) are EVs at the moment. But as we’ve seen in Europe and the US, the inevitable business incentives and regulation will push the entire industry along, so it’s one space SA’s poised for tremendous growth.

2. EVs lower transport costs by 30%–40%

The problem with low adoption is the consumer doesn’t realise the true benefits, yet. Michael points out here that, while EVs’ cost price is currently around 20% higher, electricity is 90% cheaper than fuel options.

Balance that out with maintenance, tyres, lubricants, financing and infrastructure (batteries, chargers etc.) and real-world commercial transport operators who’ve made the switch to electric see total cost of ownership savings of 30%–40% compared with fuel. And he reckons consumers will see about the same savings on their transport.

3. Big EV opportunities are in batteries and vehicle supply

Michael says there are lots of growth opportunities in SA’s EV space for founders and startups. He highlights battery swaps, manufacturing, replacement and maintenance as big-ticket opportunities. As well as helping ensure the quality of battery services across a range of suppliers and dealerships.

That said, simply getting more EVs on the ground in SA is also a hot space – whether manufacturing, importing, sales or financing – there’s a market poised for growth here.

Or if podcast app is your vibe, catch them here:

Like our podcast? Remember to subscribe and never miss an episode.

THE RESULTS

We asked if you see yourself driving an electric vehicle in the next 5 years, and almost 40% of us are on board…

🟨🟨⬜️⬜️⬜️⬜️ ⛽ No way I’m giving up my petrol (16%)
🟩🟩🟩🟩🟩🟩 🔋 Definitely going EV (39%)
🟨🟨🟨🟨⬜️⬜️ 🚗 I want a Tesla, now (29%)
⬜️⬜️⬜️⬜️⬜️⬜️ 🛵 EV only for delivery companies (6%)
🟨⬜️⬜️⬜️⬜️⬜️ 🔌 Loadshedding…lol (10%)

Your 2 cents…

Important points, Roland, thanks for sharing.

Wow, is that even viable? If so, could be very interesting.