The disruptive brand builder has been instrumental in scaling some of South Africa’s most pioneering digital brands – among them UCook, Faithful to Nature, Pet Heaven and Skoon.
So, what convinced Silvertree to invest in these companies?
"They’re all entrepreneurial-led brands that can share infrastructure like warehousing, business intelligence and marketing initiatives. They're also all purpose-driven brands focusing on digital distribution first and then omnichannel, and they tap into category trends like craft, natural, ‘good for you’ and ‘good for the planet’, and the humanisation of pets," Koser told Bizcommunity.
With his company's track record in building innovative digital brands, Koser doesn't need to be convinced about the potential of e-commerce to drive business growth.
He rightly pointed out that South African e-commerce penetration lags far behind international counterparts like the US and UK, claiming 2-3% of total retail sales locally versus above 20% in those international markets. But he added that while growing digital adoption in SA is inevitable, the Covid-19 pandemic has accelerated this by two to five years.
“Fundamentally, digital and mobile are more efficient channels to sell and communicate with consumers, if that is paired with a superior value brand proposition. This creates room for exponential growth,” explained Koser.
He added, “We are betting on further channel shift from offline to online and a focus on ‘good for you’, ‘better for the planet’ type categories, humanisation of pets and natural, craft and local.”
To drive the sustainable development of e-commerce in SA, Koser said the following is needed:
• Lower internet costs so that it becomes a commodity
• Great entrepreneurs building winning solutions that customers love
• More corporates that consider online/digital in the top three CEO priorities
Koser said that Covid-19 will continue to plague the retail industry, with visitor limitations and regulations around social distancing and hygiene to remain in place for a while. “I wish I knew what life will look like when it normalises. We are planning for more of the same as 2020 for the next two years or more.”
What he does know, is that omnichannel is the future of the industry, as digital and physical worlds continue to merge to support each other. This amalgamation is already giving rise to innovative new retail concepts like Egg, he added, which are filling the vacant spaces available in shopping malls.
For entrepreneurs looking to be the next Robyn Smith from Faithful to Nature or David Torr from UCook, here’s what advice Koser offered about putting together an attractive investment pitch.
• Be passionate about what you do and test your Total Addressable Market (TAM) properly.
• Really figure out what your unique selling point is, what your reason to exist is, and do it unreasonably well (10X better than anyone else).
• There are loads of templates to work from when compiling the actual pitch I.e. Problem, solution, market size, traction, team, etc.
• Have reasonable and tested assumptions. You need to live in two worlds - one foot in the air and one foot on the ground. It’s visionary versus realist, and you need to juggle this daily.
• Build a performance culture around you with like-minded and passionate co-founders, executives and staff.
The inaugural E-commerce Day launches on 10 March 2021, with a special editorial focus on Bizcommunity for the week. E-commerce Day is an initiative by ecommerce.co.za.
