The current environment offers many opportunities for entrepreneurs in the digital space according to fintech experts, Willem Roos, CEO of Rain, former OUTsurance CEO, and Dominique Collett, head of AlphaCode. The two fintech specialists recently discussed the topic on AlphaCode's first online Industry Insights event, a platform for the fintech community, particularly entrepreneurs, to engage with experts in the field.
Solve pain points
Although the pandemic has made things difficult for small businesses, Collett encourages entrepreneurs to look through the cycle to the digital world, address the fault lines and search for the white spaces - unmet or unarticulated needs that reveal innovation opportunities. “See how what you do changes lives for your customers. How can you use tech to solve a pain point?”
Roos agrees and says entrepreneurs must first solve a problem and the bigger the problem, the better.
“Be data-driven and analytical. Take risks, but ensure that you have a well-considered plan. We really need lots of businesses right now to create and provide jobs and value for society.”
SMAC stack technology consists of social media, mobile, analytics and cloud technology and is easily accessible to entrepreneurs. The convergence of these four technologies currently drives innovation especially during these times when there is little personal contact. “It allows small businesses to start up faster and save money because less time and cost is required on the tech side. It also enables new products to reach customers quickly and affordably,” Collett expressed.
The lockdown has forced many to start working remotely and living increasingly online. This has resulted in a drastic increase in the use of video conferencing platforms over the past few months and has brought phenomenal change to communication, although the functionality of these still has to be fine-tuned. Mobile has also seen a fundamental change, with the vast majority of people accessing the internet via mobile phones.
Roos says people will eventually return to offices, but expects the world of work to change. “A survey amongst Rain staff indicated that 70% would want to work from home and return to the office for one or two days a week.”
This makes digitisation even more important and Collett says it is all about customer adoption.
“It took a perfect storm to adopt digitisation and it will be difficult to go back. As soon as people realise how convenient digitisation is, they will not return to how it used to be done.”
Big data has been a hot topic lately, especially regarding what kind of data is kept. Collett believes that “companies with access to big data will become more powerful and cause major disruption that will result in extinction for some companies as well as innovation opportunities for entrepreneurs. Companies that learn how to manage big data will survive.”
While funding remains a challenge, it’s still great time to be an entrepreneur. The economy needs to grow, so organisations and people that can make it possible for others to flourish were encouraged do so.
One of the biggest challenges for fintech is the shortage of talent for positions that require highly-specialised skills that are currently inaccessible to South Africans. “A new possibility, now that everyone works from home, is that we can collaborate with talent from other countries and we should not waste this opportunity,” said Collett. The relaxation of visa laws is also necessary to draw better talent. “It is not a question of taking away South African jobs. We simply do not have enough qualified South Africans.” She also believes pension funds should invest more in small businesses to give them access to capital.
In Roos’ opinion, South Africa makes it difficult for people to come and live here and to start businesses; which he finds unreasonable. His argument was that, “We can draw top talent, but we must be an attractive place to work. We need regulatory changes to relax labour laws, remove bureaucracy to make it easier to open a business and offer tax incentives for small businesses.”
Attend the next event
You can watch the first online Industry Insights event. We will be hosting monthly events featuring fintech experts who will share learnings and allow engagement with a wider audience. Register for August’s talk on The future of payments and banking in an increasingly digital world.