“[Money] doesn’t turn me on. I thought it would. I thought as a young man that it would be a thing that would drive me. I just use it as a very clichéd score card but even that doesn’t turn me on. To me it’s about creating value, that turns me on,” says Allon Raiz.
A pioneer in the business incubation industry, Raiz is the founder and CEO of business incubator, Raizcorp, which according to their website is regarded by The Economist as ‘the only genuine incubator in Africa’, and currently supports more than 500 businesses.
He is also the author of two bestselling entrepreneurial books, Lose the Business Plan and What to Do When You Want to Give Up and is also entrepreneur-in-residence at the University of Oxford’s Saïd Business School.
Raiz was speaking on 702’s The Money Show with Bruce Whitfield as part of the weekly “Make Money Mondays” segment which features interviews with well-known personalities about their attitudes, hopes, fears, successes and failures with money.
Raiz says one of the most important lessons he has learnt is that success in business is not necessarily about money, and this has informed his investment philosophy. It is people that he chooses to invest in and not companies.
“I think I’m a very clichéd psychological case in the sense that my whole life is to pay it forward for what happened to me. Everything that I do right now is a result of somebody who believed in me when I was at my lowest low and gave me a second chance. Everything that I do, that Raizcorp does is about giving other people a second chance in life. To me it’s about finding that glint in somebody’s eye, that person who you think has the same set of values, the same perseverance, the same grit, the same ability to stand up again and again, and then to back them no matter what, provided they keep on trying,” says Raiz.
Here are three money lessons Allon Raiz has learnt in his time as an entrepreneur and incubator head.
1. Learn To Sell, As Soon As Possible
Raiz puts the ability to sell as one of the most important skills for every entrepreneur, one he learnt at a young age.
“When I went to varsity, the whole deal was that I used to have to work for half the holiday and then play the other holiday. I’d have to make my money in the first half for the second half. Any one of the university holidays was spent either working at the factory or in a retail environment selling, which I think is a critical thing. [What] I want my kids to do is to learn how to sell from as young as possible and get rejected and have the experience,” he says.
2. Money Is Not Necessarily What You Need To Succeed
As a young 23-year-old, Raiz’s first business, The New York Sausage Factory, was an absolute failure the first time around he says, and the biggest lesson he learnt was that money is not the key to success.
“I had a mentor at that stage who ‘discovered’ me. He called me in and I had to capitulate to the fact that I had failed and quite dramatically [I] told him that I’ll pay him back even if it took me the rest of my life. He said right now the business has failed, but if I walk out that door I would have failed. He said I should go out and do this again, but this time he would back me with people not money. That’s where I learnt that money doesn’t necessarily make success, but who you surround yourself with and your attitude is far more important,” he says.
3. Great Entrepreneurs Don’t Sell Their Time, They Sell Value
Some research indicates that the idea of paying your kids for chores can be a bad idea, says Raiz, because this teaches them to sell their time for money. However great entrepreneurs look beyond the money, he says.
“It’s all about understanding value and the concept of creating value. You should be selling value. And not in time packages, you should be selling it in units, you should sell it in products. I don’t find the selling hours model viable long-term to scale. Some organisations, such as huge consulting firms have got it right, but by far the majority of people that I see that sell time don’t scale.”
Listen: Allon Raiz chats with Bruce Whitfield about his definition of success and wealth.