Mfundo Ntsibande is the co – owner of Capello Nelspruit, a restaurant that has broken records and made it’s mark on the Nelspruit business and social scene. Since August 2009, the restaurant has cemented it’s place as the prime venue to see and be seen, and the cream of the crop when it comes to daily cuisine and pulsating night life in the capital of Mpumalanga. Behind the success of this great initiative are three very ambitious entrepreneurs, one of them Mfundo Ntsibande who was born in a small town called Barberton and grew up in Springs in the East Rand. We caught up with him for a chat about entrepreneurship and franchising:
TTS: Who are the Capello Nelspruit franchisees?
Mfundo: It’s myself and two other partners, Vezi Msibi and Jeff Maluleka.
TTS: How did you guys come together?
Mfundo: We used to do business together, we’ve got other business interests as well. I had a stint with the SABC in Nelspruit and that’s where we saw the opportunity. At the time there weren’t too many lifestyle cocktail restaurants so we saw the opportunity of starting one up in Nelspruit.
TTS: What is your family and social background?
Mfundo: I was born in a middle class family, both my parents were teachers and I was their first born. I was born in a town called Barberton, Mpumalanga and grew up in Springs, Gauteng. I studied Marketing at Pretoria University so I’ve been in the media and marketing industry all my life. I used to work for the SABC, I was the marketing manager for a radio station and a brand manager for a TV channel.
TTS: What were your aspirations growing up and what effect did they have on choices you made in terms of your education and career path?
MFundo: I’ve always wanted to be in a space where I create employment. I always admired people that hired people because that’s how you empower people. I grew up in a family where I had uncles who were businessmen so the sense of independence and deciding your own fete was instilled in me. Marketing was the initial bug that caught me, I studied marketing and also advertising through AAA and by the age of 22 I was already starting to become a businessman. I started my own magazine when I was 22! I didn’t have experience and I didn’t have money but my mind works in a way that I’m always looking for opportunities and they’ve always been marketing related because that’s my core.
TTS: Basically you know how to sell something?
I know how to sell things, I know how to make things attractive to people! The proper business side of me started about 4 years ago when I left the corporate world and started going into different business ventures.
TTS: How important do you think recognizing strengths and weaknesses while still young is, and how can that influence one’s ultimate success in terms of career or business?
Mfundo: It’s very key because we all have different talents. For examples there are people who are good with numbers, I realized from an early age that numbers weren’t my thing so I wasn’t going to try to be an accountant. It’s very important to capitalize on your strengths, invest in your strengths through education, education is key I don’t care who says what! You can be a billionaire but if you haven’t studied… or improved yourself with knowledge, you can’t compete in the marketplace. So education gives you character, it shapes you. It doesn’t necessarily give you the edge over the next guy but it shapes your thinking in how to deal with certain problems in life.
TTS: Are there other business ventures you were involved in before Capello?
Mfundo: Before Capello, I started a magazine called “Today’s Man” which was similar to “Destiny Man” and “GQ”. A men’s magazine but it was way ahead of it’s time, this was in 2001! At the time, the market was not ready for such a magazine and it was unheard of that black men can have their own magazine! But the niche was there, and I’d seen it so I set out to explore it further and unfortunately like I said, lack of experience and lack of knowledge lead to it not taking off like it should have. But then again the market wasn’t ready for it regardless and that was a big lesson because with everything you do, you need to see where the market is. Is the market moving towards that direction, or is it not?
After that venture we bought into a cosmetic company in which we became BEE partners. We were importing cosmetics from the U.S and although we ran it for about 3 years and it was doing okay, we decided to sell our shares because we felt it wasn’t as successful as we wanted it to be. I saw it as another business failure but it didn’t mean the end of the world because you keep on learning. I never thought in my wildest dreams that I’d end up owning a restaurant, I didn’t even know anything about cooking or serving cocktails!
TTS: I think it’s important for our readers to know that whatever you try, even if it fails, it’s just a building block…
Mfundo: It’s a building block! Your character gets built by the more failures you have. With unhindered success, you tend to become arrogant and think you’re indispensable, but with failure it builds your character to realize that you’re human and you make mistakes. You need to learn and be able to do things differently.
TTS: What made you decide on the specific brand, Capello? Obviously it’s been tried and tested everywhere across the country, but what made you think it would work specifically in Nelspruit?
Mfundo: Market research. There’s News Café, there’s Primi Piatti, there’s quite a few cocktail brands out there and looking at where Nelspruit was at the time, Capello was the next best thing or the easier fit where you’re going to have that cosmopolitan feel.
You’re going to have a good mixture of black and white customers sitting in the restaurant at any given time and it looks normal. Whereas if this was a “Dros”, you’d have one group of people thus you’ve segmented yourself. We didn’t want that, we wanted to be a restaurant that people can just come and have their breakfast, have their lunch and come party as well.
TTS: The franchising model has proven very successful around the world, to the young entrepreneur out there, what would you say are some of it’s key advantages as opposed to starting up a new concept?
Mfundo: One is branding, marketing. The nice thing about franchising is that you don’t have to invest a lot of money in marketing when you’re starting up because in most cases people would already be familiar with the brand like “KFC”, “McDonald’s” and “BMW” etc… wherever you put those brands people already identify with them.
The second thing is infrastructure. A lot of businesses fail in this industry, especially in cases where I’m starting my own restaurant and calling it “Mfundo’s Chill Lounge”: They fall because of the lack of infrastructure and lack of support. The support comes in many ways, it comes in training, it comes in… a way of doing things, a system. If you don’t have a system, I don’t care how successful your business is, it will fall. So with franchising there’s a way of doing things that’s already there and has been proven to work for other people. So you adopt it when you buy into a franchise and you run with it. Everything else I guess is just common sense.
TTS: So how have you applied what you’ve learnt about running a restaurant and having a system to your other business ventures?
Mfundo: I think professionalism in everything I do. Also this is a business that’s based on perception. People walk in here and look at the décor, the furniture and the feel of it and they decide they want to be seen here. So I’ve learnt a lot about people in terms of what customers want. My other business is in the media space, it’s a branding company called “Slick Branding”. Although it’s a corporate company, it still deals a lot with perception. We still sell perception but in a different way so you learn how to package things.
Most importantly though I’ve learnt that having the right staff is important because I’m running two companies, and I don’t try to be a dictator in any of them. I believe in empowering people so I have managers running the restaurant and people running Slick Branding. I manage the two companies however because it’s my vision, people need to feel that I’m always involved and the only way to do that is to put in place systems whereby when I’m not physically here, things still run smoothly because my presence is still felt because of the systems I’ve put in place. So systems are key in both companies.
TTS: When did your Capello open it’s doors and how has the response been so far?
Mfundo: It opened in August 2009. This Capello broke many records, it was the first restaurant to have a turnover of over a million rand in it’s first month! It won 3 awards: It won the best Capello in the country out of 34 stores nationwide. It also won the best representative of the Capello brand in terms of the overall experience. It also won the best franchise in terms of the way we run the business and our relationship with the franchisor. We conformed to whatever specifications were set out. To answer your question, we’ve been doing extremely well!
TTS: What are some of the more memorable moments and events, and what made them so special?
Mfundo: We hosted the Metro FM Awards pre-party and after-party with Oskido. We were packed to capacity until 6 o’clock in the morning! We hosted the pre-party for Robert Gumede’s wedding, the wedding people are still talking about till this day! They extended the restaurant into the parking lot by building a marquee including a marquee for the live band. The VIP guest list included top government officials with the likes of Julius Malema. We’ve had many lifestyle based events but those were the two events that were on a national scale. We were also considered one of the best places in Nelspruit to lounge during the 2010 Soccer World Cup.
TTS: What would you attribute the success of your restaurant to, is it the service, the location what makes it stand out amongst all the restaurants in town?
Mfundo: Service is key. If you get crap service you’re not likely to come back, no matter how good the place looks. What’s been one of our best decisions ever was that of the location, we’re situated in the premium of Nelspruit’s addresses. We’re next to Riverside Mall, Emnotweni Casino all the prime spots. We have beautiful scenery which tourists love. They love the fact that they can sit here, have their drinks and be overlooking a mountain, you can’t find that anywhere else in the country. At the end of the day it’s the whole package that we offer, the whole experience.
TTS: Talk us through the process of securing a franchise restaurant in general, without going into too much detail….
Mfundo: It depends on the brand, but most of them you have to go through a screening process. You apply first of all to be accepted by the franchisor, and then you go through a process of being screened. Like an interview basically to find out if you have the business skills, do you have the capital, do you have the right idea and do you have the business acumen to execute the idea. Then you go through their training process, if they have one, and then from there the financing aspect will be discussed, how much money you’re going to need etc…
TTS: As a businessman, how important is maintaining a good relationship with all your stakeholders namely; your staff, your suppliers, your customers and your partners?
Mfundo: It’s very key. Your stakeholders are the engine of your business. For example: You can’t negotiate good payment terms with your suppliers if you don’t have a good relationship with them, so you’ll end up finding yourself in trouble in times of poor cash-flow. I probably have 10 different stakeholders from suppliers to the franchisors, from advertising companies to promoters that want to do gigs at the restaurant etc. So it’s very vast but the key is to try to be in good standing with all of them so they’ll always come back tomorrow or when I need a favor I can always pick up the phone and say “I’ve got an event, I need A, B, C and D. I don’t have the budget but what can we do?”
TTS: There are a lot of young people out there who start businesses and end up failing, what do you think are some of the common mistakes or misconceptions about running a business?
Mfundo: The most common misconception is that you’re going to be rich! People don’t understand that your business is your job, so treat it as your job. It pays for your lifestyle, it pays for your expenses and it provides income for your employees. So when you look at it from that point of view as opposed to “I own a Capello so therefore I’m a millionaire!” I start spending money as if it’s not going to run out, I’m not managing my cash-flow and I’m not managing my books, I’m bound to fail.
TTS: How did you secure funding for your business?
Mfundo: We financed about 30% of the business ourselves, from our own pockets. The 70% we financed through the National Empowerment Fund. At the time they were funding small businesses with a required start up capital of between 3 and 5 million rand. The funding came in the form of a loan.
TTS: What’s your take on government initiatives aimed at stimulating small businesses and providing funding?
Mfundo: I think the process could be much simpler. The process right now is a bit too complicated. There isn’t enough information available so people never know where to go to get money. So they end up going to the banks, which we all know are very difficult to get money from right now. But there are organizations like the IDC which have over 5 billion rand available to disperse to businesses.
Although it’s not as simple as you going there with a business plan and saying: “I’ve got a great idea to start a TV show” it’s a bit more complex than that. The process of you coming into their doors to get the money and you finally getting the money is pretty long. It took us 8 months to complete that process, it would be better if the process took at least 3 to 6 months so young people with great ideas can come in and secure their funding. But the money is there, the government has made the money available, it’s just about knowing how to tap into it. It’s one of those things where only a few people know how to do, but the majority of them don’t.
TTS: What challenges did you go through in the process of securing funding, and how did you overcome them?
Mfundo: I think we were fortunate enough that Capello as a group had already established a relationship with the NEF so Capello walked hand in hand with us to the NEF. That gave us confidence in knowing that our backer was invested enough in us to say “These guys will do a great job, give them the money that they need.” But the other thing is, like I said, we had to come up with 30% of the capital ourselves which wasn’t easy because not everybody is sitting around with a million rand in his pocket. So we had to put up our houses and all our assets as surety to raise that money. The truth is they won’t give you a 100% funding for your business, you also have to contribute to show that you also have faith in the product that you want to buy into.
TTS: I read somewhere that roughly 60% of all your sales as a restaurant, are normally from repeat customers, how true is that?
Mfundo: It’s very true. You’re likely to go eat or drink at a place that you like. You don’t want to go to a different restaurant everyday. You’re going to keep on going there because you like the specific menu or you just like chilling there. Nelspruit isn’t a big city so the culture of dining out hasn’t been that big here, so you tend to get the same people coming here on a daily basis.
TTS: What more can visitors and loyal Capello customers expect from their favorite restaurant in Nelspruit?
Mfundo: We’re trying to innovate our product offering, in terms of our menu. We’re going to be bringing in products that aren’t on offer anywhere else, your Ed Hardy champagnes, your Cavalli vodkas, all those premium lifestyle brands. We want to try them out here first. We’re adapting our menu to our customer base here in the Lowveld. For example people here like their pap. So pap has become a standard on our menu for anything that you want to eat. We’re also re-investing money in the infrastructure and décor of the restaurant. It’s an expensive structure to maintain because it’s eye-catching and when you’ve been here ten times it becomes normal, so you’ve got to maintain that fresh and new feel to it so customers don’t get too familiar with the usual.
TTS: With that said, what would you say is the long term vision of Capello?
Mfundo: Within the 2 years that we’ve been in business, we’ve done very well so we want to maintain that position. We want to retain our key customers, but most importantly I’d like to see this restaurant in 3 years time to be running itself, I’d like the employees to be in charge of it. We’re not looking to be here for 5 years, we want this business to grow to a point where it will be a provider for many families and the people who actually started out working for it, end up owning it. And for Capello I think it will be the first restaurant that actually gets sold back to the people that worked for it.
TTS: Any final words of advice to all aspiring entrepreneurs out there?
Mfundo: Embrace failure. When things don’t work out and the challenges make it look impossible, embrace it. That’s always a way to challenge you to think out of the box. Secondly, I’m a man of prayer. I’ve learnt to pray more now that I’m in business than I ever have in my life. I’ve realized that before you do something, whatever business you want to venture into, you should just pray and ask God if it’s the right vision that you have and if it is, you’ll see things just working out. No matter how difficult it looks and no matter how impossible it seems.
By Ngoato Ramaube - Follow Him On Twitter @Ngoato1
By Ngoato Ramaube - Follow Him On Twitter @Ngoato1
