Entrepreneurship is often depicted as a solitary pursuit of a lonesome visionary risking it all by swimming against the stream. While this is partly true – building your own business certainly does feel lonely at times – entrepreneurs need the support of others, even if it is just one key individual at the right time.
“We need someone to believe in us,” says Fuad Jakoet, owner of the Cape Town based road freight company Volksco. In his case, Fuad needed to persuade a financier to take a chance on his fledgling road-freight operation by lending him R2 million for a new long-haul truck and trailer.
After a long career in the road-freight industry, Fuad had, not for the first time, stepped out of corporate employment to start his own operation from scratch. A big part of his start-up “capital” was the deep knowledge and network that he had built up over two decades of working in the distribution business, at times as an employee, and at times as a contractor.
Starting off with a couple of small vehicles in 2017 and building up a fleet one small vehicle at a time, Fuad inevitably reached the financial conundrum that most owners of growing businesses face – how to find finance to take the business to the next level without the revenue track record to justify the loan.
“You phone a bank and the first problem is that you get the sense that you’re speaking to a computer,” says Fuad. “They ask you to show them your income and in the end they tell you ‘no, you don’t qualify for a R2 m loan with these revenue levels’. It’s no use telling them that the truck that you will be buying with the R2 m will change the whole game. They just don’t see that.”
Fuad says his experience with Business Partners Limited was the opposite.
When his accountant suggested approaching Business Partners Limited for finance, Fuad remembered that he had asked Business Partners Limited twenty years ago for a loan to finance an idea he had for a business. “I was 19 at the time and I didn’t know you had to at least start putting an idea into practice before you can get finance. But they were encouraging, and I learned a lot from the questions that Business Partners Limited asked me.”
This time, he approached Business Partners Limited with a fully operational business. The first contrast with the banks that struck Fuad was that Business Partners Limited officials conducted business with him face-to-face.
Secondly, they didn’t just take into account his balance sheet and current income, but also his business experience and the difference that the loan will make to the business. Up to that point, Volksco had to outsource some of its work to other trucking companies. With his own fleet of trucks, Fuad is able to maintain better quality control and bigger margins.
By approving the loan, Business Partners Limited took a leap of faith in his business, says Fuad. It was exactly what his business needed at the time – someone who believes in it. Fuad’s relationship with Business Partners Limited deepened a year later when his business suffered a number of setbacks, mainly because of suboptimal hiring decisions. There were a few months when Volksco could not repay the loan as Fuad scrambled to restructure his team.
“I had to ask Business Partners Limited to believe in me a second time, and they did,” says Fuad. He put together a business rescue plan for his business and carefully monitored the progress of each stage and managed to be back on track with his repayment.
Today, Volksco is in good shape and the loan will be paid off in a few months, growth levels are healthy, and Fuad is proud to have proven worthy of the faith put in his business.
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