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Yoco and that beaten-down eatery in the US

Sep 04 2017 13:07
Liziwe Ndalana

Cape Town - The idea to roll out a client-centric, easy-to-use mobile payment system in South Africa came to the Yoco co-founders while sitting in a run-down eatery in the US.

Sharing the memory with Fin24, CEO Katlego Maphai described the contrast between this "really beaten-down barbecue eatery" and the modern payment system.

"There was really nothing on the counter top, no till, nothing. She [the owner] asks us how we'd wanted to pay, takes out this Android phone, sticks in this dongle, swipes his [my friend's] card and he signs with his finger... it was just like [the] lights [went on]."

WATCH as Maphai shares the journey

He said his close circle of friends, who now makes up the executive of Yoco, has come up many business models in the early 2010s, but it kept on surfing back to mobile point of sale.

Yoco was however up against a host of other similar products - Nedbank's pocket POS; Absa's pebble; iKhoka in Durban; ZipZap; SnapScan - but even then they could benefit from what Maphai calls "last mover advantage".

Yoco was officially launched in 2015 and has doubled the size of the business every year since.

Challenges

Maphai said one of their biggest challenges was to be taken seriously, and to first take themselves seriously, including presenting their operation properly.

He said their key to success was building a very strong advisory board very early, which gave them credibility. 

Maphai said having experienced people from the payment space as part of their board of advisers put them at an advantage. "When we talked to the banks, this immediately gave us a tick. They were not even looking at us, but they were looking at the other person (board members). 

WATCH: Maphai explains Yoco's secret to success 

Funding, future plans

Capital funding was another hurdle that the Yoco team had to clear. Maphai said they had a lot of rejection,  but this rejection became a valuable feedback for them.

"It's a very powerful thing... you start developing resilience and start pushing the envelope," Maphai said.

He said this helped them in preparing for the questions that future investors would ask. "It’s like having an outsider looking in on your business; suddenly you see a hole in your business model, which you couldn’t see before."

On future plans, Maphai said: "We want to be the first true Pan-African player. We don’t just want to operate  locally, but in Africa as a continent". He said Yoco already has pilots in West Africa in the pipeline.

Their ultimate goal is to be a partner of choice for SMMEs in Africa, Maphai said.

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