How losing R2m in a deal, liquidation saw Antoinette Prophy start local accelerator

A common African proverb says a strong bull is seen by its scars, not by the lack of them. The same can be said of experienced entrepreneurs. Battle hardened serial entrepreneur and 88 Business Collective founder Antoinette Prophy has the scars to show for it.

She’s grown an ad agency from the lounge of her mother’s house to a company employing 60 employees with a footprint in East Africa. She’s been at the losing end of a deal — and lost R2-million, and she’s gone through a nightmare no entrepreneur wants to face, liquidation of their first business.

Her woman-focused business accelerator 88 Business Collective, has its origins after the failure of a handbag venture Prophy pursued after liquidating her advertising agency — proving that failure in entrepreneurship should not be treated as taboo, to be shunned and not spoken about, but instead should be an important experience to be shared and celebrated.

Speaking at a Startup Grind event held at Workshop 17 last week on Thursday (12 October), Prophy (pictured above) chronicled how her journey as an entrepreneur influenced her founding the 88 Business Collective accelerator.

Antoinette Prophy grew Afrofusion from her mother’s lounge into operating in East Africa, all without securing external funding

The Johannesburg-born entrepreneur worked for consultancy firm McKinsey for three years. In November 2003 “the entrepreneurial bug bit” and she quit her job, moved back into her mother’s home and started her own business.

“That’s when I started Afrofusion, in my mother’s lounge with R200, a laptop and a pocket full of dreams,” said Prophy.

At its peak the Johannesburg-based company had a footprint in East Africa with offices in Uganda and Kenya, all without having taken on any external funding.

“It was really me just saying to myself, I am going to plough everything that I have, not just my physical energy into this business, but every cent I have,” she said.

Losing R2-million and liquidation

The trouble started when in 2008 she went against advice from Deloitte on an acquisition “which would have turned Afrofusion into a beast of note”. The deal culminated in her losing R2-million.

“I was stubborn and decided I was going to do it anyway. So I embarked on the acquisition strategy, put everything in place. We were packing up our offices to move into these new big offices and the sellers just pulled out.

“They (the sellers) did not believe I was able to raise the R10-million that was needed to close the deal. And I had already ploughed R2-million into it to make it possible,” she said.

Prophy said that was her first big failure at the time. “It cut me deep, but not as badly as the liquidation,” she said.

Her words of advice for others is not to treat ones business as if it were “your baby”.

“When I liquidated my ad agency which I spent 12 years building it broke me,” she said. “When you treat your business like a baby it is difficult to exit and it’s too devastating when you need to liquidate,” said Prophy.

Prophy’s East African expansion between 2010 and 2013 eventually failed, leading to her liquidating the company. She said she was not ready for the opportunity to expand into Uganda and that it was not something they had planned for.

The main lesson she learnt from all this? “Every opportunity that comes your way is possibly not meant for you –unless if you have a plan,” she said.

She also advised entrepreneurs to “not let monetary wellness wow you into thinking you are okay”, a mistake she attributes to the causing the failure of her East African expansion.

“‘Cause it can be temporary, unless you have a plan. You need to have a plan in place,” she added.

Founding 88 Business Collective

After liquidating her ad agency, Prophy attempted to run a handbag business. Although the business eventually failed, she decided to use her experience as an entrepreneur to help other women entrepreneurs not make the same mistakes she had made.

“So I decided, let me as part of the collective not just create a space for women entrepreneurs to not make the mistakes I’d made, but to give them a real support system that will help them take their business to that next level,” she said, adding that she never thought she would end up running an accelerator.

The accelerator currently works with 12 women entrepreneurs. Applications for the accelerator’s most recent round opened in April this year to women-owned private businesses operating in the Western Cape. Over 200 entrepreneurs applied and 54 ended up meeting the criteria and getting shortlisted.

“It’s a dynamic community for entrepreneurs by entrepreneurs,” added Prophy.

“The one thing I asked for as part of the criteria was the need to be collaborative, the 88 Business Collective is all about collaboration. It’s growth through collaboration. We’ve got two ladies in construction two in engineering, we’ve got a quantity surveyor. If we put these two women together we could come up with the next generation of Group 5.”

Prophy believes the next generation of corporates will be collaborative startups. “The days of competing like animals are over.”

Featured image: Antoinette Prophy (Supplied)