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Business has taken off for Ryno Goosen and his geospatial data analytics company Locstat Systems, after he and his co-founders got valuable sales and marketing assistance from the Grindstone Accelerator.
Locstat is now looking to take on three new hires thanks to the help the company received while taking part in the 10-month programme’. Currently the Cape Town based startup has 10 employees.
The startup was one of 12 companies (see the list here) that attended the programme’s fourth cohort which concluded recently.
Venture capital (VC) company Knife Capital, which runs the programme together with Thinkroom Consulting, revealed today that the 12 firms on the programme achieved average revenue growth of 36% and added 32 new jobs between them while on the programme (the table below has it as 27 jobs by 10 companies — but Knife Capital’s Keet van Zyl explained that this is a weighted measure, to allow for comparisons with previous cohorts).
Locstat achieved the highest growth across all metrics during the cohort and by doing so, has won R100 000 to spend on an international business development initiative of their choice.
Locstat achieved the highest growth in the Grindstone Accelerator and will hire three new employees
Among other things the startup provides financial service providers with real-time monitoring of financial transactions by using geopositioning technology together with artificial intelligence (AI) to detect suspicious transactions.
Goosen (pictured above, second from left with co-founder Ford, right and Knife Capital’s Van Zyl and Andre Bohmert) and his partners Hallam Ford and Sanjay Baya, who all have a military background, founded the business after re-purposing technology that is used by the military as a planning tool by creating a digital equivalent of a battlefield.
But while the three, who founded the business together in 2016, may have the technical expertise, sales and marketing was never quite their strong point.
“It’s that old story: You tend to spend too much time in the business instead of on the business,” says Goosen.
But with the help of the programme’s mentors the company rebranded — from Suretec Geospatial to Locstoc Systems — and is now working with a marketing company that has helped them to generate digital leads.
Before the programme, the company relied on cold-calling, while the company had no customer relationship management (CRM) system to record transactions in the sales pipeline. “It wasn’t the best way to go about things,” admits Goosen.
Each year the programme takes about 10 SA small businesses with proven traction through an intensive review of their strategies and provides them with the necessary support to build a foundation for growth in becoming more investable, sustainable and exit-ready.
A number of SA’s top tech companies have passed through the programme. They include radar startup iKubu, acquired by Garmin (see this story), and online payment gateway Payfast, which was recently acquired by DPO Group (see this story).
Knife Capital has invested in two other past participants — ticketing solutions provider Quicket (see this story) and more recently last month, in warehouse management software company Cradle Technology Services (see this story) — via its Sars Section 12J VC company, KNF Ventures.
‘Lower growth down to slowing economy’
Yet while the 12 firms in the last cohort were able to increase their revenue by an average of 36%, the increase falls below the average year-on-year increase in revenue of 56% of the previous three cohorts of the programme (see the above table).
Van Zyl admits that while 36% is still “impressive”, the lower average revenue growth likely points to the tougher current economic conditions in the country.
What then is Goosen’s advice to these and other entrepreneurs who join the programme? “You need to go with open eyes into it and slurp up enough information as you can,” he says.
In these trying times a hunger for new and better ways of doing things will have any business owner on the programme salivating.
Read more: Knife Capital announces participants in fourth cohort of Grindstone Accelerator
Read more: Knife Capital launches fourth edition of Grindstone Accelerator programme
Read more: Hitting the high road – what it takes to join Grindstone accelerator [Q&A]
Featured image (from left to right): Knife Capital partners Keet van Zyl and Andrea Bohmert with Locstat Systems co-founders Ryno Goosen and Hallam Ford (Supplied)