What's up, everybody? This is Cortland from AndyHackers.com, and you're listening to the
Andy Hackers podcast. On this show, I talked to the founders of profitable internet businesses,
and I try to get a sense of what it's like to be in their shoes. How did they get to
where they are today? How did they make decisions, both in their companies and in their personal
lives? And what exactly makes their businesses tick? And the goal here, as always, is so
that the rest of us can learn from their examples and go on to build our own profitable internet
businesses. Today, I am in beautiful South Africa in Cape Town, sitting across from the
lovely Alex Proctor, the founder of Diggs. Alex, welcome to the show.
Thank you so much, Cortland. I'm so excited to be chatting to you.
I'm excited to be here. South Africa is...
Amazing.
It's amazing. It's amazing. It's a great place. It's honestly a very confusing place,
too, for an American to come. There's so many different groups that live here in different
situations, and... I mean, we have 11 national languages.
Yeah. Just like the start.
That's too many.
I mean, I wrote science, a hell of a confusing. I was like, oh my gosh, which one do I pick?
Yeah. I don't know what the right number of national languages is, but 11 is definitely.
And one turn of a take you to this beautiful, beachy, really out-market area, and the other
turn of a take you to a place where you don't want to end up after dark. It's like one or two.
There's no in-between.
Yeah. Well, I'm succeeding. I haven't been murdered yet, but it's my last day here, so
I think I'll make it out alive.
And then you just cross those fingers.
So tell us a little bit about DIGS. What is it exactly?
So DIGS or DIGS Connect is Africa's largest student accommodation marketplace. Essentially,
we sort of call ourselves the MV of student housing, which perhaps I shouldn't say on
an American-based podcast because people might actually have issue with that, but it's not
African-nauseous concern yet.
But basically, what we do is in a marketplace, it just connects landlords and students. In
South Africa, we have a bunch of universities, a bunch of private colleges, about 2.3 million
students in total, but only a tiny amount of those students are housed by the actual
university. It's about 5%. So most students either living at home or need to find their
own housing. Before DIGS Connect started, there was no place to go. It was really antiquated.
There were posters on walls, there were stickers up, and the university library saying spare
room in my house, my flat, whatever it is. Just so you know, a DIGS is like a South African
term for a student commune, like a house, or my DIGS, whatever.
And yeah, there's no place to go. I mean, there's maybe like Facebook groups or people
chat to each other or a friend of a friend with no place, but there's no actual go-to
place. And it was getting worse almost every year where people were like, we cannot find
a place this day. And especially taking South Africa's history into account where we've
tried to really... Our infrastructure didn't support the entire population to go to university.
And so there's been an influx of more students going to university, but not the infrastructure
to support that, definitely the housing to support that. And so students are now being
supported by government to go to university to break these public cycles, gain education,
but they had no place to go stay. So they'll arrive on campus and literally be homeless.
Students will arrive and be sleeping in lecture theatres, be sleeping in the library, like
nowhere to go. And there are these huge prototyping area. I mean, I know if you guys heard about
the fees must fall movement, but there's this massive protest for years ago called fees
must fall in all the students around South Africa. And it's like literally like protest
on campus, they went to parliament, they're doing petitions. And I mean, the one thing
that even happened around that was called Shaqville. And the Shaq is kind of like a
slum, like a township, like a slum. And these students came onto campus at UCT at the University
of Cape Town. And they actually built a Shaq saying that this is what we reduced to as
students because there's no housing. And the media picked up on this, went absolutely mad.
And the narrative of the time was that there is not enough student housing.
And around the same time with this, I was in my undergrad at UCT. And I was quite involved
in student like politics and student governance. And I ended up being elected onto the student
representative council, which is like the highest student governance body at the university.
And interestingly enough, my portfolio was student housing. And so after all the students
that couldn't find a place to stay, they're coming to me saying how to find a place to stay.
But on the other side, I had landlords calling in saying that, you know, we have these student
properties and they're vacant. Where do you find students? Or you also have these big
property companies here in South Africa that have like thousands of beds, have all these
empty rooms, they've got vacancies, you know, where are the students? So from both sides,
you have this demand, like, you know, students looking for places to stay, parents looking for
places for their kids. And then you had the landlords, the property companies say, you know,
where the students, how can you like fill these beds up? And then you had the colleges, the
university that were completely overloaded with students demanding a place to stay,
but not knowing where to send them. And there's just no real solution. This is happening up until
like recently, before days can expire, like 2017, this was still happening, where people were,
do paper-based system. So I was seeing my little SRC office at UCT, and I had on my like SRC
computer, literally an Excel spreadsheet, and I had a list of all the students that come to me
saying, I need to find a place to stay, I had a list of all the landlords calling and saying,
we have beds. And I was matching them up manually, being like, you got here, you got here, you got
here. And I was studying biology at the time, because I wanted to become Tomb Raider.
I just was like, that's cool. I could, I don't want to be Tomb Raider, man. So I thought if I
studied biology and then work for like mass geographic, I could be Tomb Raider. It made sense
in my mind. Okay. I was like 20 years. And I involved in street politics and yeah, that was all
about it. And sitting there and I'd done a year of comp sites, like really basic, like Python,
a little bit of like JavaScript, like, and you basically, I like string a website together.
And what I couldn't learn from like Vasti, you can learn online, like easy,
like Khan Academy, Udemy, those kinds of things. Exactly. There's a ton of resources.
And I mean, honestly, it's amazing. And so over a weekend, I was like, what if I just like built a
website, like a really basic, I just took this database of like properties and sent students
there just for like, just to solve my problem I was facing. And like, it was never this like,
oh, I'm going to start a company, or I'm this entrepreneur, or I want to be in business.
I was like, let me just solve my problem and build this website.
So literally over a weekend, I built a two page website. And the one page was you could list
property or file the property. So you'll scroll through your list. And the other page was you
could add a property. And that was literally it. I put up over a weekend, I called it digs connect,
because digs like the student word for like an African word for a student house. And it connects
because you're connecting each other. I don't know. I was like, it sounds cool. I remember
sitting in the SRC meeting. And I was briefing everyone else in the meeting. I was like, guys, I'm
going to build a website called digs connect. But because I speak quite fast, they were like,
Dicks Connect. Are you sure we're going to push this like Dicks Connect agenda?
South Africa's premier gay dating website.
It's like a sexual awareness. I was like, no, guys, Dicks Connect. But by then, some guy had
drawn a picture of two dicks touching. And he was like, this has to be the logo for Dicks Connect.
We actually recently, on two weeks ago, we bought dicksconnect.com as part of like a marketing
ploy. This is what happens when you start a startup and college. We call it a Dicks Connect.
Dicks Connect. And with the website up, and I sent students there, I told them to go list them.
And by and large, kind of forgot about it. Like I'll check it every now and again.
But I was still doing my qualification, still studying. And then I remember just like sitting
in lectures and I was looking at my Google Analytics and being like,
fuck, check out traffic. This is insane. Like who are these people going on our platform?
And then we started getting like organic listings that are on Cape Town. And I was like,
these are like other people that I haven't spoken to, just like going on the website and
creating listings. This is like insane. And we started getting more and more traffic,
more and more students. And then the closest town to Stellenbosch, there's another big university
there, starting listing Stellenbosch and students from there going on. And I was like, sure,
this is like hectic. And then we've got like phone calls from guys in like Joburg, Adritoria,
and Jobritoria in Kharting. And like the market there is three times bigger than the market here
in the Western Cape. So I mean, there was like a huge bump in our growth. And I was like,
that's insane. And then one day I got a phone call from this guy and he's like,
oh, I love it. Let's connect. And I have 4,000 student beds on the list on your platform.
And we're like, wow, that's crazy. And he was like listing from a place in Potcherstrom.
Potcherstrom is like a tiny little town, almost in the middle of nowhere, but they have a huge
university there. They service about 75,000 students. It's the University of the Northwest,
massive. And we're like, holy shit. Like this is like, this is happening, you know? And then
more and more we're cycling this traffic and it's exploding. And then end up dropping out and being
like, this makes us a real business. We reached the company. My two co-founders then jumped on
board. That's Greg and Brendan. We rebuilt the entire platform because I did the original
platform and I'm like a dreadful developer, like self-taught hacker. Like half the screen is like
reading how to do it. The other half is doing it. Like it was terrible. It was hideous. But then
Brendan rebuilt the whole thing, built it in Django and React and ended up hosting on Google Cloud
just because they gave us a ton of free credits. And every time I wrote a credit, we just like
emailed them and were like, hey guys, can you give us more free credit? They're like, yeah, sure.
So we're like, thanks. We wrote the whole platform. And then just, yeah, I mean, it's just been insane
ever since then. We've just been growing like crazy. We now list about 70,000 beds on our platform.
Oh, we launched the first version of the website in January 2018. It's almost exactly two years ago.
And yeah, we now list about 70,000 beds on our platform in about 17 locations across South
Africa, basically every university before the presence. And then a big milestone we reached was
last year in March, we decided to fundraise the first time. We had a few offers coming through,
but like it was for all my, my co-founders. I first wrote our first time to write, you know,
starting a company and go through all the process of building a company. But we had these guys
approach us and they said, can we like, you know, investment company? We can say no, we're not keen,
we're not keen, we're not keen. And then we started getting a bit too much interest from people
that we're probably gonna start competing with us. And we're like, look, we've got this really
incredible opportunity, not really doing anything in the space yet. There seems to be a lot of
demand here. If we don't take this seriously and get this company the resources it needs,
there's a chance that someone might overtake us or we'll fuck it up and then like lose a lot of
clients. So like, let's get serious. Let's actually like hire a proper dev team. There's
three of us then, you know, we'll let's hire a proper dev team, some real marketing here.
Let's get some real like operational support here. Let's use all the tools, the sales forces,
whatever it needs to like make this thing work. And so we decided to, yeah, to go to markets,
like fundraising. So we put together a pitch deck, did the whole process. And I realized that most
of the work when it comes to fundraising is actually like in the preparation. I think if
you prepare like really well, you get your pitch properly, a proper, you do your numbers properly,
get your projections right, your budget, your forecast, everything was like properly done.
We got financial help because we didn't have financial background. So we got a guy who was
an auditor from Deloitte in London. He joined our team and he made sure that like our financials
made sense. We then pushed to like a few guys. And yeah, I mean, it was incredible. We got
off the bat, we got some incredible offers from some really big players in South Africa.
And we'd almost closed the deal and we had like had a term she was on the table. And we're going
to fly to Drobo to kind of like close the deal there. And then the morning it was supposed to
fly, we got a call from these guys saying, hey, do you want to come push to us? And we're like,
well, fine. We actually very busy, but like, fine, you know, we'll come through.
And so we walked in with these guys and it was just like, like a love at first sight. I swear to
God, like you just, there's this came straight away. Like that's what should be with your
investors. Like you just sit down and we just clicked straight away. And it was like the same
image of the company, the same outlook, the same like approach to what the company is going to be,
the future of the company, we were completely on the same page. And it was just like incredible.
After an hour, we're like, oh my God, this is perfect. Actually, we were like, we were exactly
the company they were looking to invest. They were exactly the kind of basis we wanted.
They would guide us, would open doors for us. They would be mentors for us. They would have
the financial support for us, but also give us the space to be entrepreneurs. They trusted our
vision. They trusted what we want to build. And so they're like, please don't go to Joburg. Like,
let's just call our guys down here. So they called their partners across. We then pitched to the
entire group of them and literally within a week, we had a term sheet on the table, went to Legals
after that and closed the deal, I'd say about a month later. So about five weeks we turned around
from an initial chat to a deal and it's been almost a year now with them. And it has been
extraordinary. I mean, they've just been amazing. How much money did you raise?
We raised 12 million rand in our seed round.
So 12 million rand, it's just under a million dollars, eight or $900,000.
It's the biggest seed round in South Africa to date.
Wow. You're like the leading South African startup, basically, which is pretty cool.
I wouldn't say that, but as people have said that,
it's been said about us.
Well, I will say it again. You know, the thing that stood out to me and that story is the nature
of the problem that you were solving. In South Africa, you have a massive influx of new students
who maybe their parents and their parents' parents had never gotten an education before.
Colleges just weren't ready for this just descent of so many students. And so people are literally
going to college and they're homeless and they can't sleep anywhere. And along comes Diggs Connect.
And you're suddenly connecting these students with places to live. Why had nobody
done that before you if the problem was so drastic and it was so pressing and so obvious?
I think that South Africa is like, so I've got like a practical
answers and a philosophical answer to this. I guess I'll start with the philosophical one.
I think that maybe a lot of South Africans don't feel like, I want to say almost like the audacity
to solve problems or don't feel like the capability to solve problems.
I think that a lot of South Africans sort of look around all the things that are wrong in our country
and there's a lot. We have a crazy crime. We have rolling blackouts. We've got crazy inequality.
There's insane poverty. And I think a lot of people feel powerless to make changes. And
especially because the issues facing students, students are young. You're 18, 19, 20 years old
and maybe you don't feel capable of making these changes. Maybe you don't feel like it's actually,
you can do it. You look at a problem if you're overwhelmed by breaking down into steps. And I
think that it's maybe just like, yeah, I don't think it's a cultural thing, but where education
system works, don't sit down across the world as you totally sit down and put your hand up if you
got a question or listen to what the teacher says or ask permission. We're not told to actually
stand up and take control and take the lead and figure it out and solve the problem. And that's
one of my biggest gripes, the education system is that it doesn't make leaders, makes followers.
And maybe in South Africa, it's that issue where we don't solve the problems that we haven't.
So people are just complaining or we wait for someone else to do it for us. It's someone else
will fix it or how can, I don't know, the power structures that be, whether it's the universities
or the government or the big players, how can this happen? They'll fix it for us. Instead of
realizing that the power to change the world rests with you as an individual, with your tenacity and
with your conviction to believe that you can change it. And you can make a solution that
only solves your own problem, but the problems of people around you and affirm that you can make
something that fixes the problems that humanity is facing and our planet is facing. And something
that I really wanted to do a lot of my life personally is like, how can I inspire South
Africans, especially, you know, sort of African women and a permanent African woman living in
quite different situations. You said you actually can change your circumstances. It's completely
on you to like, you know, to lift yourself up. You have to wait for our incompetent government,
you know, to get around because they won't get around to it quite frankly. You have to wait for
other people, like big business, because journey big business is motivated by profits. You know,
like it's cool. I think the millennial business, especially in young entrepreneurs have like this
social justice mission, what they do, which is super cool. But in the end, I think that's,
you know, I think people just didn't feel like they all capable of making the solution to it.
And then the practical thing is that I think South Africa is quite just behind in terms of tech,
like the thing I'm just like building a platform, which, you know, this is so like, I think so
natural, perhaps in like America or like, you know, the UK or like in Europe and stuff, it's like,
just build tech solutions, build an app for it. It's almost like a joke how like common it is.
I just build an app for that. Whereas here, it's not that common. Like, I mean, I'd say that's in
my last two years of being a tech entrepreneur, I probably know every single tech startup in the
country. They are just not because I'm super well natured, because there aren't a lot of us,
you know, like over the course of like a year or so, a couple of months, even you can meet literally
every single tech entrepreneur in the country, first name basis, we do dinner, poker nights,
that kind of stuff. And like, that's, there aren't a lot of us, people just take us in widespread
here. So I got the feeling at the NDS meetup last night that like, everybody knew each other,
like a huge percentage of the startups were there. Like, Hey, Nick, hey, Mike, it's like,
how you doing? Yeah, you've all known each other for a long time. You all went to college together
like seven years ago. It's all it's very tight knit. They all know each other for a while.
So yeah, that's a lot of us. And something else the issues is that people didn't think they could
build the solution. And they didn't know how to build the solution. And I mean, it's fair enough.
I mean, Lord knows when I started, I didn't know how to do it or what to do or anything like that.
Everything I've learned, I've learned for the first time, every time raising funding was the
first one learned how to do a pitch deck, how to do this content cashflow, every day, I'm learning
how to manage a team, you have to be a good leader, every day, I'm learning how to, you know,
turn a profit, I like to do sales for the first time while doing sales. It's kind of just like,
it's, it's like an audacity thing. I think you have to, I don't know, you just have to
have this word South Africa, scum, it means like, have no shame. And it's like, oh, but no scum,
you just, you just have to be shameless. You have to be shameless. Exactly. Yeah.
So you have to just like not really care about things going wrong. And maybe that's the other
thing actually, now I think about is that there's no safety net in South Africa, really. Like in
richer countries, there's a safety net in that if something goes wrong in your life,
you probably won't end up on the streets. I mean, you probably have like a family that is
fairly well established. They're in jobs, they've got a good home, they've got insurance. You
probably have, you know, social security, you probably have insurance. You probably have like,
you know, a big tax base where your government will look after you. And that is not the case
in South Africa. Like if you fuck up here, the consequences are extremely serious. You'll be on
the street, you know, like people, there's, there's a minority of people in this country that have
got money that have got kind of like that, that safety net. But for a lot of South Africans,
they come from very, very desperate situations. You spoke about it earlier about, you know,
a lot of people, it's their first time in their family. And like, a huge family, they'll be going
to university, they'll be finishing with Tricky, but most people haven't finished, you know,
with Tricky or high education. And so now you're taking like, you know, people from like really
poor backgrounds who come from like, you know, villages or townships, who are now having to like
take loans from the government or from business to, you know, get education. And the stakes are
just so high. Like, I think the risk, the nature of risk of starting a company, you know, and
it's, it's just doesn't weigh out how much people could lose. And like, it's kind of a conversation
we had earlier, you know, off the podcast about, you know, what people want. I think most people
just want to have like, reach a level of stability here. Like, South Africa is so fascinating,
because there's such a huge spread of like, not super wealthy, but like, generally pretty wealthy
people, to people that are extremely desperate. I mean, extremely desperate here. And, and kind of
like everything, you know, between that. And so it's just people just want to live a good, stable
life. They want to be able to have, you know, a solid brick house with like four walls around.
They want to make sure the kids are going to like a good school where there's not 80 kids in a class,
but like it's a normal size where they have the books are coming through. They want to live with
a stable government that isn't, you know, like infighting all the time. And there's not like
corruption stories in the front page of the newspaper every single day. And there's not like
bribery happening all the time. And they want to be able to go to a hospital and actually see a
competent doctor and are waiting in line for days and, you know, get, get super even more sick in
those dodgy hospitals. So I think that most people here just want to have a good life. And the thing
of providing solutions is still quite a new mentality. Yeah, in America, we've got the so-called
American dream, which I think was like much stronger when I was a kid. I remember in the 90s,
everybody feeling like I can be the next Bill Gates. And you mentioned that, you know, the
educational system here sort of produces followers, not leaders, but it feels the same in the United
States. Education is sort of like, get on this track, get this degree, et cetera, et cetera.
But our media sort of broadcasts these business leaders as heroes, like Bill Gates is a hero,
Elon Musk from South Africa, like everyone knows who he is in America. And it kind of inspires
people to start things. And we don't have the same lack of encouragement that exists here,
where it's like, okay, well, you know, you don't have a safety net or you don't necessarily have the
infrastructure. For example, if you have, I don't know what it's called, the power just goes out.
Oh, yeah, it's called load shitting. Yeah, it's rolling blackouts. Exactly. And so it's like,
at this time of day, this week, every month, you know, the power is going to be out. And like,
you want to code, you can't, sorry, your internet's out. You want to go get a sandwich from the shop.
Sorry, their kitchen's down. And like, that's, it's insane. I mean, it's honestly insane that like,
our government is so incompetent to the extent that we have scheduled blackouts across our country,
where like, it is costing our economy, billions of rounds, because businesses can't operate. I mean,
like, just for ourselves, we're like a tiny little example, we're just a team of 13 people. And like,
you know, two year old, that company, but like, we're an inter-based company. So when the power
goes out, our internet goes out. So sure, we can maybe hotspot off our phones for a while. But then,
because there's so many power outages, the battery power that backs up like the cell phone towers,
those go out. So then our data connection cuts out, right? And then after four hours, our laptops,
like the power runs out there. So like, we're still paying everyone to be in the office,
you know, we're still, our clients, our users are still expecting us to like access things, but
like, they just, they can't. And it's like, it's, it's insane. But on the other hand, too,
I feel like all these problems, and I'm like a diehard optimist, and I feel like all these
problems make us better off in years, like, like, makes us so resilient, where we are constantly
having to like, take these hits, and we have to adjust, we have to hustle, we have to reevaluate,
we have to make a plan, every day, we have to make a plan, if something goes wrong, and you have to
figure it out and get better for it. And I think as an entrepreneur, one of those exciting things,
one of the best tests you can have is when things go wrong, how can you not like, there's something
like, oh, no, this thing's gone wrong, maybe just patch it, but rather like, how can I use this
as a learning lesson to be like, to make something even better, to like, make it like a 10 expert
experience, because I think it's so bad, and use this opportunity really just to rise above. And
that's what it does here. I think that, you know, the kind of business needs we have in this country,
the kind of entrepreneurs like Kanye Tethia are world class, just because we didn't think that no
one else dealt with. I mean, for example, like, I know, I think that's why my dad's a doctor, and
often what he sees is a lot of med students from like Scandinavia will come onto South Africa,
and in two weeks, they'll see more cases here than they would see in like, yeah, I mean, you spend
a Friday night at one of our government hospitals, you will see everything, short of a war zone.
So it's just you, the experience you get here is like, out of this world, but it does get
hella frustrating. You know, when you're trying to, when you're trying to build a company, you're
trying to like, not only are entrepreneurs and business people in this country, not only are we
making a profit, we are developing this country. I think that the future of this continent of Africa
depends on the entrepreneurs, because we are developing this place. And I think you can
almost compare the like, development with freedom. That's actually, I'm quoting from a book and I
was reading called Development as Freedom. It's by Retaya Sen, I think. And it's brilliant. It's
really, really good. It's like, yeah, it's shaped, it's informed a lot of my opinions on like,
economics and development economics. But if you look at like, a lack of development as basically
unfreedom in individuals, like, it is so crucial that like, we allow people to develop, to build
products, to build services, to build infrastructure. And yeah, be rewarded through that, through like,
you know, profit, whatever it is, because like, that development allows opportunities for people.
We were saying earlier how mobile banking apps have literally like, lifted the GDP of some
countries in Africa, like in Kenya, just because now it's allowing people to like, transact the
way they never could before. I mean, the government is never going to get around you. Like, I'll tell
you right now, first time experience, any government in Africa will never come close, providing the kind
of like, infrastructure and services and upliftment, social upliftment, that like, it takes startup
world, like 100%. We just like, we enable people to like, to like, interact. I mean, just to be
like, a small thing that this thing is doing, like, we're allowing students, like, to find a home.
I mean, the story I had the other day was, this kid from Zimbabwe is in his third year at university
in South Africa. And every year he's like, it is such a disaster because like, I couldn't get a
visa to come study in South Africa until I had proof of accommodation. But I couldn't get proof
of accommodation because I was in Zimbabwe. So I couldn't find a place to stay. And like,
I didn't know where to go before. I mean, like, you go on like, these dodgy free listing websites,
but then there's are so full of scammers. It's kind of like the version of, you know,
your guys Craigslist. Yeah. But you're going to study websites. And he's like, I do now
pay deposit on this dodgy website, I probably get scammed, but then at least I've got like,
like a lease, which I could give to the government to get my visa, but then I'll still arrive late.
It was my first week of lectures. And like, it's a really tough game from a different country. And
now I'm around the back foot and trying to get this education. And now we're trying to like,
you know, educate a generation of young Africans to like become active citizens in the economies.
We can't even help them get an education. It's ridiculous. Yeah. And then, you know,
he mentioned to me the other day, and he's like, I just want to say like with DiggsConnect, it's,
you've got no idea I want to just help me now, because I could find a place to stay
in two days in DiggsConnect to pay the deposit and it's a legit place. I know it's good quality.
I know I'm going to be safe there. I know it's like right by university because you can look
on the map and all the features we have on our website and our app. Booked, paid, done. Got my
beats for the first time in my entire undergrad. I'm going to get you to waste your time. And like,
I don't know, I get like so emotional actually. I know it's supposed to be like this cold strategic
business person. Like it's so emotional. Read these stories. It's like the government are
failing these people, you know, but like just me and a couple of other crazy like students,
we built this website to solve a problem. And like, it's changing people's lives, you know,
changing the way that education is being experienced. And that's just like, we're just
one story. There are so many other startups that are doing those incredible things across
insurance, across health, across like, so many different areas that are just really like making
the world a better place, really shaping humanity. And I think it is so inspiring and so exciting.
And I mean, the government needs to get out of our way, all with the kind of support to take
entrepreneurs. I live in the Bay Area and there's so many startups that don't do anything nearly
that impactful. It's kind of a cliche at this point that like the latest thing out of Silicon
Valley is always going to be like some sort of meaningless app to get you more addicted to
something. Coming here, it's like talking to all the founders of the meetup last night, all of you
were sort of together and you want your companies to improve the infrastructure and the cost like
the the quality of life and the country and like actually have an impact on people here. And I
think, you know, on one hand, it's like very depressing to see just how stark some of the
problems are here. But also as an entrepreneur, it gives you the ability to have a crazy impact. I
mean, you went from like zero to what 70, 80,000 listings on your website and like not that many
years. And like, that's the sign that you're actually serving a very unmet need that people
really care passionately about. I will say like, if you're an entrepreneur, like Africa is a lot
of opportunity. There's like, I mean, I think apparently like Google or like some like really
big, you know, these big companies in America are so focused on the potential that Africa is going
to be with like so many, like hundreds of billions of people that are coming into like, almost into
like, like the the online marketplace. Now, I mean, these people that want to transact, they want to
buy these consumers, they're like, are going to start taking like taking part in our international
economy. And it is like such an exciting place, I think, to, to build the company to like sort of
wet your teeth in a way. And to just build infrastructure like there's because there's
such a lack of infrastructure, like even like the hard infrastructure, soft infrastructure to
just like ancillary services. There's like there's so much opportunity. And so a lot of my friends,
you'll see that who, you know, went to, I don't know, like in like space of school and stuff,
are leaving the country, you know, they're just like, actually, it's too bad. It's too dangerous.
There's no opportunity. I want to go to a logo living in London right now. I mean, I say like,
like half of London is like South Africa, or not going to Australia. And they're leaving and,
and like, I love what you want to leave. But I'm just like, it's, I don't know, it's boring.
It's so you're gonna go somewhere to read like so developed, there's like, an entrepreneur on
every corner, you're gonna build stuff, and they have like so much competition. And like,
everything's been done. So yeah, what can you do and do like a meaningless app that does
who even cares something like lame, whereas here, like, because the problems are so
intense and so fast, and the scope is so big and affects so many people, you can literally just
being in your early 20s with a couple of friends, build something that will impact hundreds of
1000 people in a deeply meaningful way. And I think like, in terms of the big stuff, like the
meaning of life kind of stuff, like what are you doing every day? It is so gratifying. It is so
meaningful that like, what you're doing and the code you're writing or like the content you create,
or whatever it is, that is affecting so many people in such a profound way. And yeah, it's tough,
but like living out here and trying to operate in these conditions, but it is so exciting. And I
think in terms of like a meaningful life and an exciting life, there is no place I'd rather be
than building a company in South Africa. Tell me about these early days when you weren't really
treating this as like the mission for your life, when it was just kind of a cool project that you
put together, you know, an Excel spreadsheet and then a website that you built. Where were all these
people coming from? And at what point did you decide, Hey, this shouldn't just be a side project.
This is something that should really be my mission. Sure. So it kind of happens in steps.
It wasn't like a, like aha moment where I'm like, okay, that's it. I'm just calling Jeff Bezos.
It is kind of like, yeah, like small things that happen every night. I get nudged in that direction.
Like I remember the first people we had were basically all the ladders who were calling me
an SRC saying, Hey, I heard you, the SRC person this year, here's my room details, send students
here. So I just, there's an answer to call me and I say, Oh, well I've actually just built like a
basic websites as part of SRC thing. You can just create your listing on this link. Yeah.
So this is you as like part of the student government and your mandate was basically
fixing or helping with students. Yeah. You have predecessors. Yeah. Presumably also got these
calls from landlords, but they never made a website. No, they have an Excel spreadsheet.
Like what were they had an Excel spreadsheet? I think they would like just do calls or maybe
do like an email like emailers or the, I mean the universities, how do I say this nicely?
Bureaucratic. Right. And so if you want to try introduce innovation, it has to go through like
a hundred bodies for approval first. And everyone's going to say no the whole way up and you can
fight those. And I love fighting a no, someone say no to me. I'm like, yes, because I could
fight you to change your mind and you can fight the whole way to the top. A lot of people get
over it after the first no, but, and so it's just like, it's just knows the whole way.
You were getting those. I want to build this website, but people were like, no,
I went to university and I was like, I'm going to like, what do you guys think about this thing
where we build into the university's website? Like on your guy's domain, we'd have a link
that would just like be your student housing portal. We can digitalize the entire process.
I pitched the whole thing to them. I met with the committees, the housing committees, the
deputy vice chancellors, all the right people in the right structures. I have the secretary,
secretaries, PA, everybody in these big monolithic bureaucratic systems, email after email to email,
the meetings. And basically we're just said no, they're like, we don't need it. We,
we have this nice poster on the wall. Look at the, we like our students homeless.
What about the poll? Yeah, exactly. Like what about the poster? Like,
can't you see there's a great poster or like, look at our nice list we have here,
like a paper that gives you that you print out a paper list and give it to you.
It's something university in South Africa who, who haven't worked with us yet are still giving
out paper lists to their students. They're standing cues around the building. And we're
just like, that is, that is insane. All those students are sitting there on their phones.
Like surely you should reach them on their phone with an app. Like they're on their phones,
but no, you basically want to give them paper lists. So anyway, so these basically these big
bureaucratic systems. And I think that my predecessors perhaps in my, in the ROAS and
just were facing the nose and just didn't have like the, the lack of scam, you know,
I had to kind of be like, well, fine then if you don't want to judge it myself. And it's kind of
always been something in my life where people say no to me and like, well, I don't need you.
Whatever. I'll do it anyways. Like you suck. And then I'll just do it myself. And then how
much it costs me just because I don't know, just because of like the, the fuck you attitude that
someone's gets where people would like darkness that couldn't do it just to prove them wrong.
And I don't know how much it physically cost me, like the pain, the agony, like the sleepless nights,
the, the social, like the rejection. I will do it to prove a point. And sometimes it has
always been in my benefit. It's backfired several times. But I think it was that I was just,
I just was like, funny, I'll do it. Literally, I can't be that hard to build a website. Honestly,
like, and it wasn't, I mean, I think even like a WordPress where it's like, come on,
you can do that in a few hours, a Wix website. It's free. Like it's not hard. You don't need,
also you don't need endless resources. I mean, I was on a shared server on like a local server
company here for like 50 random months. And it's like $2 or something. Like it's yeah,
it's nothing. It's fine. And it's not hard to do. So I just literally did it. And yeah,
I got up there and then I think the students that were going on the site was because, well,
I was a student, so all my friends were students. So I'd post on Facebook, like, haha, look at my
website guys. And then I was like, what the heck? And then I got on it to be like, well,
it's actually so funny because my friends look for places there. So like really small traffic.
I mean, like one or two people going on. But then also being SRC helped a lot because I had like
status then. Like I wasn't just like a random student. I'd been like elected in by like,
you know, student votes. And so also because I wasn't SRC, like I was kind of known at the
university and I'm pretty loud. And so I'd always like walk into lecture theaters and be like,
guys, we have a very important issue we're talking about right now. The designated smoking
zones on campus. I was like that person. It would like hate it for being so annoying.
But everybody knew what you were saying.
Yeah. It was like, oh God, it's her again. She's going to like campaign about something.
And so I was just like, yeah, sagging it out there across social media platforms.
Like when I wasn't tweeting about my disdain for the government, I was like tweeting about
this like silly website I'd built. And that's how it kind of started. And then like it worked
for someone. Someone would be like, oh my gosh, well, I actually found someone on there. And then
I bought another page called Find a Digs Mate. A Digs Mate is like a roommate and people found
roommates on there. And that was actually really cool because, you know, the university experience
is more than just about education. It's about the social experiences, who you're studying with.
It's the friends you had, the memories you make. It's, oh, we're setting up at two o'clock in the
morning, drinking beers in our dorm room and talking about the meaning of life. It's, you know,
doing those like, oh my gosh, we have an exam in four hours. We've got a crowd right now. It's
staying together. It's the hustle together. And that kind of community experience we want to bring
into the next experience. And especially in South Africa, there's a word you could have went to,
which means like togetherness. And it's really key in like our national like identity and culture.
And so this togetherness was so important for us, especially for students living off campus,
you know, who felt excluded from, you know, the university experience to make them feel they're
still part of it. They're still part of the community. And it just started working. I mean,
students were finding roommates, still making friends, landlords were finding, you know,
tenants on the website. And especially for, you know, for a landlord, you look at them,
it's not, I mean, some of these big property companies that have, you know, like tens of
thousands of beds and they're owned by bigger international property companies. It's like
hundreds of millions, if not billions of rounds of revenue. So like, they're just like, they're
fine. But a lot of our landlords are just like ordinary South Africans. They're middle-class
South Africans that, you know, saved up their whole lives. They've bought an investment property,
like, you know, two-bedroom flat or like a four-bedroom house in a student area,
like a Ronda Bosch or a brown fintane. And they want to fill up. And they're not wealthy. They
can't like, you know, take a few months of like no tenants because they can't afford that. They go
to pay off their mortgages. They go pay off their rates and taxes. South Africans are taxed
extremely heavily and get pretty much nothing in return for it. It's just another jab of the
government there. And they have to pay, you know, the insurance and then security companies. And
they've got these bills piling up. They've got their kids are going to pay for. They're working
insane hours. And they can't afford to have vacancies. So for them, it's really real. They
have to get tenants in there. And so you see all these South Africans are coming to us saying,
we've got to find tenants. We've got these nice properties. And these are good people. They're
not like these crazy predatory parasitic capitalists. They want to like bleed the
country out. They're good, normal middle-class South Africans that are investing in our
economy, buying property. And they're trying to fill their dreams up. And they put their
properties in Disconnect and they fill them up. And they're like, this is super cool. And they'll
tell their friends who had bought investment properties, you know, you should try out putting
your place in Disconnect. And we just started like, literally just like paying people up,
you know, just it worked. I think it's, you know, I've been learning more about like the
kind of lingo you use in like startups and stuff. But you know, it's when a user activates,
I think is the term. Like when does it work? When does someone go on Disconnect? And they're just
like, holy shit, this works. You know, for a student, it's like, I love this. This works
for a landlord. This works. This is worth coming back. And that's kind of what just started. There
was completely organic growth at the beginning where it's working out for us. And then we're
my co-founder Greg Joyne. And I like, I could talk about Greg for hours. He is just the coolest,
most incredible, most like amazing person in like the whole fucking world. I love him so much.
Could he join up before you dropped out of school?
He did. He did actually. And he is incredible at marketing. Like he's just like a marketing,
branding genius. Another reason why he works so well together. So we were on SLC together and we
ran a student society together. So we knew we worked really well together. Like we'd worked
together for a while before. And, and his boyfriend is also actually a friend of mine from high
school. So like super like tight-knit, which is awesome. Anyways, so he joined up and he is just
really good at things that I'm really bad at. So I'm good at big picture stuff and crazy ideas.
And like, rah, but I'm really bad operation. You like, I put out focus sometimes and I get bored
if I like to do the same thing all the time. Whereas Greg is like a machine operations.
He just like structured everything has plans. Like, you know, the guy just takes like an
extra spreadsheet and he's like, okay, this is the timelines. We're going to achieve these
are our eyes. And then that was going to get, he's like, boom, boom, boom. And he's like,
get it done. And then Brandon comes along and he can like pull the stuff. So the three of us,
it was really strong team, which I think is also like such a big part of how it actually worked,
how they kind of succeeded because like, we're such a strong co-founding team and like our skills
are so complimentary. Like we've just perfectly fit together in terms of, you know, what we can
offer each other. Like I can come up with these crazy ideas and I just like go out there and I
make things happen. I do the sales and I speak to people. I get really excited. Greg can take these
things and like actually make it happen now. Instead of just the being ideas, he can make
an actual plan. Okay. This is how we're going to make this actually work. And the brain comes
along and say, okay, cool. I can build this. And Brandon is like this insane developer who can like
hear about the entire platform and like a month or something like that. I mean, the guy just,
when he gets into his code, like he does not sleep. He just, he's insane. So, you know,
the two of them came on board. So we're just being organic growth. And then Greg's like,
no, I think you need to go big. And we need to go wild. We need to get everyone's attention now,
you know, cause we have each market. What makes the marketplace work is when there's liquidity,
you know, you have to have enough buyers for sellers. And so for us, you have to have enough
beds for students. And because we're in so different cities, it's always tricky balancing
the ratio in each place. So we have teams, we have landlord teams, we've got student teams.
And let's say for example, in like Johannesburg, you're servicing the two main universities there
is with Bartrandt and the University of Johannesburg. And then you go out to private colleges.
And there's a few main student areas like Bronfen teen, Dornflotene, Rosebank. And so you look at
those areas and be like, how many beds do we have and what's our student traffic and balance those
out. And if we find that, you know, we really lacking one number, we have to do a bit of a
marketing push to kind of balance it out. So we found that in Cape Town, we started getting a lot
of landlords, because a lot of property was being built in the marketplace, kind of being flooded
with beds, but not enough students at one point. So we're like, okay, cool. How do we get a lot of
students on the platform? Let's do a bit of like marketing. And so again, this is our first time
figuring out marketing. And so we're like, okay, well, we could put posters up on campus. So we
could like give out flyers on campus. We're like, it sounds so lame. Like, it's like a lot of boring
companies do. I mean, people are posters, what the hell? Like, we do like online advertising,
but everyone hates online ads. I mean, like this, I mean, now we do them. But like, when you started
out like that, we need to like make, we need to start with a splash. We can't do something lame.
So we thought instead of like spending, and this is like, if we had any money, I mean, we were still
like students, like just recently dropped out. We had like no cash at the time. What I was doing is
I was living in a bachelor's apartment. I put a drywall up down the middle. I borrowed money,
put a drywall up, rented half an hour digs connect. So I could make money to literally like
feed myself at the time. And we were scraping together like 10 rounds here and there.
And Greg was like, what if we just took 10,000 rand in 10 rand notes, we stapled them to our
flyers and we just threw them out in a crowd at the university. And we were like, what?
That is insane. Let's do it. We had to collect seven banks with banks and carry
much cash on them anymore. We had to collect several banks and get like this huge bag,
basically of money, you know, like walking through the streets of Cape Town, just like,
really dodgy at the bag of money.
That was dangerous. We tried to like hide. It's a little bit like nondescript.
I mean, you really have like a payback with like a dollar sign on the front.
And then, I mean, let me tell like, you know, it's like, it wasn't like you're going to get
to cash to store the money out. We knew like it had to be like impactful. So Greg and his
classic Greg scar, like plan the whole thing out, literally like a battle plan. I mean, he had,
the documents came out again, the spreadsheets came out and we had the whole thing planned down
to the minute. So we did a three-day build up and we got all like the basic Instagram influencers
on board, all the student influencers. We had them excited behind photographers. We had drone
footage of the day. We had the media involved.
So you told everybody you're going to throw cash into the crowd.
10,000 rand. It's going to be drops on UC's campus. Get excited, you know? And so like everyone was
buzzing. Students were just going mad. They're like Instagramming. They're tweeting about it.
We were like, we ate all these really cool like, um, like graphics and like, um, and like posts about it. And
we're just getting like word out there and like leaking stories to the news the whole time.
And then an auto build up on the day before we did a mini job. We dropped 2000 rand just like
at the food court and that got people hyped because then we also had like photographers
there. I'll show you some of the photos. If you go on our Instagram, you'll see them.
We just see the photographs today. It was insane. So the day before we start dropping
my notes, people knew it was legit and everyone was just talking about, oh my gosh, I got like
a hundred on campus. I got 200 on a campus today. This is a lot of money for a student. I mean,
you think that like to pay perspective, like you could buy a sandwich on campus for 20 rand.
So we're dropping 10,000 rand now. Yeah. So people were just like, it was hectic.
And his money's like attached to like, uh, an ad for Diggs Connect, a flyer. Okay.
So we designed a flyer that said, thank you, UCT, this is for you.
Then, um, it was our tag line. Just, if I send Diggs pics,
it's all like Diggs connecting. So it raises eyebrows. Sometimes we had a bit of backlash,
but that's what you can do when you're marketing to college.
You were selling to bankers. I'm not sure that one.
Yeah, I don't know. Maybe actually for bankers, it probably would work. Let's be serious.
It probably would work for bankers. Then for students, we had fly to say, send Diggs pics,
Diggs pics. Sorry.
What's forcing you to say this?
Send Diggs pics, um, with our flyers and the 10 rand.
So on the morning we wake up and it's like 8am. And that, I mean, the university is panicking
now because it's been on like the national news that we're going to drop money. Everyone's like
freaking out and they're like tweeting at us. They're like, please, what's going on? We gotta
know. But we weren't going to be ridiculous about it. We had to hide like private security to kind
of mix into the crowd. In case it was arrived, we'd had paramedics on standby. Like the whole thing
was legit. And we start like doing like stories on Instagram. We have the main, the main like
Instagram influencers they call like, you see just kidding. It's a meme page, but everyone follows
them. And so we start like dropping hints. It's like, okay, they weren't ready. It's happening
at 12 o'clock, 12 o'clock. And like everyone was online, like just messaging us. The hype was
insane. Like it was like walking on the couch trying to look for us because we had our Diggs
getting t-shirts up and we were wearing hoodies over it so they couldn't see us. And so it was
like guys, where's Diggs, where's Diggs connected? Like Scott on campus. And then we start up at the
food court. How used to lay it out on a mountain side. So there's a lot of stairs and like a lot
of like concrete and stuff. So we planned the route very carefully. It's going to be me,
Baron and Greg, and then kind of like the crew of these meme guys following us live streaming
the whole thing. And we're supposed to run from the food court down to the main plaza,
which is called Jammy Plaza, Jamsen Plaza. And it's kind of like, if you look at like
pictures of UCTs, like the main big building with like the columns and stuff and like kind
of like Greco-Roman architecture. And so we start the food courts and we take our hoodies off and
always see beauty. This like scream goes out like, and we were just like, push it.
And like, I'm the smallest between the three. I was like, Greg, Baron and I.
So it was not gunning for me, right? I'm just holding this like stack of cash in my hands.
I just like panic and it's like modes of planning. We looked at masks and planned the route. I just
like, fuck this. Like I thought it was not right. So I throw up like a couple of hundred rad.
People's like scrambling, like rugby tackling. I didn't know what you were like before.
It's not really a big mistake, but like these like rugby tackles like that before me.
I was like, I'm reasonably fit, but I was like pushing the limit that day. I was like
just staying bolting my way through that campus. Like it was nobody's.
It just caused chaos on campus.
It was. I'll show the videos. I mean, this is insane. So I start, I start like running
down the stairs and it's just like about a hundred people sprinting out to me and I'm
just like running for my life at this point. It's like pure terror. It's like throwing out
money as I go. I come around the corner, like by the library, two jumps and pliers expecting to be
like maybe like a hundred people there. I come out this raw erupts. There's about 4,000 people
waiting for us on campus. But I'm alone now because Greg and Baron are coming around the
other side, but like the mainstays going up. So everyone doesn't see me. This entire crowd turns
around and starts sprinting straight at me. Like the fear I felt in my heart in that moment.
I just like threw the money up in the air, dropped down. It's not like this should
crash and crawl into people's legs.
And then at the moment Greg very come on the corner and they start throwing their money
out. So the crowd spins around us running for them. And it was just like, it was crazy.
The cool thing is that like, this wasn't bad. Like people not actually got hurt.
How many people died during that? That's what I want to know.
There's nothing bad happening because we had security guys there, like in the crowd to make
sure there's no actual fights. Everyone was having like fun. It was like really positive. There was
no like, like mob action. It was just really good. People were just, it was fine. It really was fine.
It solved your student shortage on the website.
Yeah. I mean, our traffic that day was insane. Like we got, not only was it the traffic from
the students themselves going, aren't you? Like what is DigsConnect? Because they heard about us.
Our brand awareness was huge. Since that day, we've owned UCT. Like the UCT market, the CATAR
market belongs to us because their marketing campaign. Not only that, we got national news.
We've got international news because of that. We're invited to talk at like marketing events,
but like guerrilla marketing. Because we also not only have we done this campaign,
we had hired photographers because we knew the photographs would be amazing. So we've got these
beautiful shots of like Jamison Hall and like the DigsConnect sort of like flyers going everywhere.
I mean, beautiful images. Like we plan the whole thing out, of course.
How much did this cost you? This sounds like an expensive event,
not to mention the money you're giving away, but like security.
So one thing I am extremely tired of that is being stingy. It's one of my great gifts in life.
It's how can I save a buck here and there? I think it's why my face is like me so much.
So I was like, oh, I think cost 20 round. Like how dare you? You'll pay two. Two round.
So not that much. I mean, obviously 10,000 was 10,000 round. Security, we actually got from the
university. We're like, we need your security guards because it's going to be like, it's for
your own benefit. You don't want students to be in a fight. So they covered that.
We had like the university health professionals there as paramedics. So they were covering that.
Photographers cost us like a couple. We got student photographers. We didn't hire like these
amazing like natural graph photographers. We got guys that were like studying photography
and they were like stoked to have a couple hundred bucks. Yeah. So I mean, honestly,
not more than like 12,000 round. And like to give people an idea of what this is,
South African Rand, I think it's about a 14 to one conversion rate with the US dollars.
10,000 Rand is like $700. Not that much money to probably the average American listener.
Crazy that like an entire college goes crazy for that.
I mean, and you see especially me, it's the, I think it's like a coin to the world's university
right there. It's a big university in Africa. So it's pretty is the premier universe in the
continent. And $700 gets everybody in a frenzy. And it belongs to disconnect.
So one of the things I've noticed that, you know, is that how far a dollar can get you in Cape Town,
you can rent like a five bedroom cliffside beach facing Villa for like, you know, $150 a
night here. It's crazy. And a lot of the founders that I talked to at the India actors meetup last
night were taking advantage of this by basically starting companies where their customers are based
somewhere in the Western world and they can pay a ton of money and they don't need that much profit
to live a comfortable life as a founder in Africa. Whereas your situation is different. You're
basically targeting local customers. You're not necessarily taking advantage of the fact that you
you can reach a global audience because it's a very local business. What was your business model
and how are you basically able to, you know, eventually pull yourself up from having to live,
you know, in like a makeshift house just to pay your bills.
So actually we weren't sure to make money and the solution actually came to us from our users.
We had built this like this free platform as like a couple of students. I mean, like this is cool,
it solves a problem, but like none of us had studied business or knew much about business.
We just were like kind of going along with like the life. And during our company season that
now is our business season between I think November to February is because our university
starts in February. And so everyone looks for places stay between like November to January.
And it's like really busy. And so Atlanta would go on the platform and it's like at 8am,
create listing. And by 4pm, they're on page 10. And so they'll call us and be like,
what the heck? How could be on page one? And we're like, oh, sorry, you can't,
this is really busy right now. And the one guy's like, okay, can I pay you on page one?
And we're like, that's a cool idea. Like, how much would you pay us to be on page one?
And he was like, I don't know. What do you, what do you think? And we're like, um, 50 bucks.
And the guy's like, okay. We're like, okay, no, wait, no, wait. He was like, okay. We're like,
no, wait, wait, 200. And eventually realized we get to like, like a fair amount of money,
because like we had built something so valuable that like people willing to pay for that. And
that's like, I think what the core business is, literally just like, solve someone's problem.
And like, how much someone to pay? So they probably sold for them. And as we realized,
like very early on, like people were like, literally willing to pay us because we had
sold a problem for them. We could help them find tenants. And we looked and then we started getting
serious about, you know, the business model, looking at, you know, what were like competitors
is charging. It's like a state agent. So every time they place someone, what was the commission, the kind of structure, um,
other like listing platforms, what are they kind of charging? Like how much was the lease
worth to a landlord? And when you deduct things that you pay, like all the expenses, what was left?
So what is like a fair price for that lead generation fee, you know? And then we just
kind of informalizing that in a way. So instead of paying, I mean, everyone pays from the front page,
that doesn't necessarily ensure success. So something that we spoke about last night is like,
how do you align your, your monetization with like your actual value add as a company? And our value
add is like, like a signed lease, a placement. If a student is moving to a property because everyone's
winning and the students won, they found a place to stay. They're stoked. The dollar's winning. They
found a tenant. They, you know, getting rent. They're, they're pretty happy. So that moment,
that's like our main KPI. And that's absolutely like, that's is when we should be charging. So that's
we do charge now. So we do a place in fee on that. We just, we're in trouble to work on that. I mean,
this is all of course brand new stuff. Every day we figure out a new thing. So we only rolled that
out last year in September with like a pilot group of landlords. We have like a couple thousand
landlords. We pilot with like 20 and it's been like insanely successful. Like we've had like
thousands of applications saved just for those few landlords. And so we're going to be rolling it
out to everyone this year. It's part of our 2020 plan because like people have to pay then. It's
like I was saying, like you, you will pay for this value. Like you will spend, I mean, law
knows I spend a fortune on coffee every day because I get a lot of value on it. So the value is
there. We help people fill their beds. We help students our places there. And that's we charge.
That's such an important point. I think if you provide something of value for people,
they'll pay for it. Absolutely. And it, it's one of those things where a lot of people talk about,
for example, should I start a B2B or B2C business? Should I sell to other businesses or should I sell
to other consumers? And I think the stereotype is that it's really hard to sell to consumers,
especially students because they don't have any money. No, it's so much harder to get them to
pay for things. But the reality is that there are things that consumers pay a lot of money for.
Housing is pretty much at the top of that list. You will pay a lot of money for housing because
it's an extremely necessary thing. And like education is right up there. Food, as you mentioned,
coffee, people pay a lot for it. And so the fact that you're actually solving not a trivial fake
problem. You're not like helping people, you know, do something that they would normally never do.
You're helping people solve one of the basic necessities of life. Yeah. Housing, I mean,
it's like a human rights. So of course you can charge for it and you can charge commission
basically or a percentage of these matchmaking that you're doing and build a very profitable
business. Absolutely. I mean, we add as much value for landlords. If you look at, especially
in the big companies, you have thousands of beds. You look at how much an empty bed costs them,
that lease fee. I mean, a lease is worth, let's say anything between like 40,000 rand to like
120,000 rand. And you start multiplying those leases, even like you have five, six, seven empty
beds, it adds to a lot of money for them. So to spend a couple of thousand rand to fill up those
beds, it's worth it. Not only in terms of, you know, the tangible thing of like, I'm filling a bed,
I'm getting rental, but just like vacancies look bad. So let's say now you're a property company,
you own a few buildings and you want to go to the bank to get a loan to get another one.
They can say like, you know, what's your vacancy rate? And if you've got a vacancy rate, it's
pretty high. Like that's not, it's not attractive to like, loan my entry there and check fill up.
You're like, obviously are you, you're kind of failing it as an operator. So like, we've just
like streamlined everything at this extreme focus at Diggs Connect. It's like, we will fill your
beds with students. And like, that's been really important for us to kind of be like super, super
focused. And it's, I think it's so tempting as a startup founder, especially like, you know,
young startup founders and first timers to be like, look at all these cool ideas. Like we're gonna
do it all. And like someone will be like lying in bed, like two in the morning, all these crazy
ideas and be like, oh my gosh, you're totally this one, like totally out there idea. And I'll call
my co-founders and wake them up and be like, guys, best idea ever. Ice cream. Totally out there.
They're like, what? No. And luckily I've had this incredible mentor who's just like, he's,
he's bought like three companies already. He like picked me up out of like the swamps of like
early entrepreneurship days. And he's been like invaluable to me. I couldn't even start him. He
always says it's like, whenever I call him, I'm like, Phillip, I got this crazy idea. He's like,
no, I don't want to hear about it. You're focused. You need a full beds. That's what you do. You
full student beds. You're a student brand, you're student accommodation. I don't hear about anything
else until you get that right. Until every single student in this country that is looking for
off-screen student accommodation, about 1.2 million students. And like, until like a vast
proportion of those are being serviced by your platform, don't even look at anything else. Like
extreme focus. Cause every time that you're thinking or working on something else, it isn't
your core value add. You're taking time away from fixing another thing. And like the chance of
succeeding is like directly proportional to how much time you're putting into that, that one thing
you're doing. It's like, I don't know if you want to be a runner, you got to run. If you're not
running and you're like, I don't play chess or something, then like, what the fuck? Run.
So what are your goals at this point? You raised money. You've built out a team of how many people?
There's 13 of us.
13 of you in this wonderful office. You're trying to focus. There's 1.2 million students in South
Africa who need housing. Where do you go from here? How big of a company do you want to build and why?
So the plan is right now we're in like the heat of our season. Right now is like we have
every day this month has been busy in the last day. Like January is a crazy month. It is just
insane right now. It was a places day. So we just need to survive January. We need to make sure that
we're not dropping the ball, that we're pacing all the students and we're monetizing. Cause as
we make all our money, now it's in January. So just lock down this month, do a good job,
make sure that all the students are ever placed this day. By about like mid to in February,
then things will die down completely. Students will stay on the place for the year and they're
out. So we kind of like live our lives from like February to February. So then after that
plan is to just then roll out our monetization across to all our users. Cause you know,
we kind of piled up the small subsection. So around with everyone, make sure that's working.
And there's a few options we're looking at. We're quite excited to have like a
student ecosystem. Like there are so many ancillary services to education
that students require that we could, we could actually disconnect. I mean,
look at all the ways that students transact in from the textbooks to transport, tutoring,
financial services, top-ups, loans. There's like all these ways we can work with students,
just like help, you know, like support the educational experience. We can expand to
property more. You know, we've got one foot in PropTech, one foot in like edtech. So we could
do more like PropTech stuff. That's really exciting. I think especially in Africa,
like properties are really exciting. Or we just keep, we have now maybe going to national.
Like there's a lot of, a lot of students in the world, a lot of places that I think a lot of
first world countries are too scared to trade. If you've built a business in the States or in the
UK and you're used to building a company in like an established economy with a stable government,
going somewhere, perhaps like India or like Argentina or like, you know,
somewhere it's still developing, it might be stacked, might be tough.
Whereas like we've no, like we thrive in developing in tough conditions. So maybe
it's expanding to places that haven't been, you know, talked about competition yet.
There's a few things we're looking at.
There's a lot of options.
A lot of options. Honestly, we haven't looked at two. Probably we have our big kind of strategy
meeting at the end of our season. So once we've gone through the season, we just like learning
everything we can now, focusing on our core thing, our core KPI, which is just placing students,
learning from that and then adjusting from there.
How do you like, I know you haven't had this meeting yet, but how do you even think about
evaluating, you know, which of those options you're going to choose? Because it's, you know,
and to some degree, you have to consider your goals as a founder and what you want to do personally,
what will make you happy, what you like working on, the impact you want to have,
how big your business can get, which one is more lucrative, which of these options,
which of these factors do you think resonates with you the most?
I think that entrepreneurship was like a mistake for me. Like it kind of just like happened.
Like I never planned on doing this and like wants to be this. And somehow I just fell into this and
it was the most like serendipitous event because like, I fucking love it. It is so cool. And it's
such a cool, exciting, meaningful kick-ass way to spend like, you know, life of building companies
and like, and working on like, you know, building companies and especially in South Africa and
across Africa. I, yeah, I want to keep doing this. Like I can't imagine doing anything else in my life.
And even though like, I think it's exciting and lucrative to look at like fossil countries,
but adding services and building companies, developing places where they need it more,
you know, building especially across Africa is, I think, such a great challenge.
And it's such a cool thing to do to wake up and face a really hard situation. Be like,
how do you build a company or how do you build this infrastructure in a place like,
you know, the DRC, like, you know, in like Ethiopia, whatever, and facing those challenges
and like figuring it out and like, and having a huge impact. I mean, I think that's really cool.
And when things connect, it's just, it's a cool company. I mean, we've got such a strong like
student brand. We have an awesome user base. It just, the impact we can have,
like the ripple effects we have with that is so exciting. I mean, just for example, like
one of the towns we work is called, it's Gramston. It's a little town in the Eastern Cape and there's
a university called Rhodes University. It's a great university. The town itself is quite poor
and the province, the province of the state is also quite poor. But with DigsConnect, for example,
we've seen that we've gone there. We've gone to, again, like local homeowners, normal South Africans
that have, you know, spare apartment and they've listed their place on DigsConnect. Now students
that have either funding from their parents or from a bank or from the government are going there,
spending money now and staying in this rent. And now we've seen like, not only are the allowance
making money, like, you know, these local South Africans, but also these ancillary services are
picking up now. There's cafes that started like popping up to feed the students and beauty salons
and like art galleries. And suddenly there's this wave entrepreneurship that's been picked up and
built in the back of like, you know, what DigsConnect is doing. And this is so fucking cool. Like if we
can do this across a budgeted economy, it's around all these university towns, these college towns,
where like you literally like bring people together, you lend to like transact economically
of our service. I mean, this is super cool. Like if we could just keep taking this out to the world,
like I don't, yeah, I don't see anything else I'd want to do other than this. I mean,
we had it a few offers to like people want to buy the company. It's way too soon. I mean,
like if I wasn't doing this, I just thought about the company and I don't know, maybe like a space
company. But yeah, now I'm loving this. I mean, like couldn't imagine anything else. Yeah.
Digs is one of the coolest companies you could possibly run it. You get to do all sorts of
immature marketing campaigns. Your tagline is you extend DigsFix, come on. That's cool.
So a lot of people listening live in places where it's not super developed, where there aren't a
lot of investors or aren't a lot of people building tech businesses, and they want to have
an impact. And maybe they have some of the same fears that people in South Africa might have. They
don't necessarily have a good fallback plan. They don't necessarily have the infrastructure to do
something well. What's your biggest tip to indie hackers in that situation for how they can get
started and build something impactful? I think the first thing is the belief in yourself. You
have to believe that you are capable of fixing the problem. You are capable of providing the
solution. There's no special formula. You have to be born with it. I mean, the great entrepreneurs,
it's not like some big secret that they have that makes them capable and you're not capable.
Everyone is capable of building the company, fixing the problem, providing the solution,
just playing that role in society. So it's an absolute belief that you can do it.
And that has to stick with you. That has to get really deep inside you and stick with you,
because people are going to say no to you a thousand times. You're going to try to...
I mean, I've cold-cored landlords. When we first started, I was cold-coding landlords all the time
saying, hey, please list your property on Disconnect. And they'd be like, no.
Where'd you get my number from? You're free. And I'd be like, sorry. Okay, bye.
So people are going to say no to you so often. People are going to say, are you crazy? Or they're
going to try to shame you. You're going to fuck up. I mean, I've gone to pitch to big property
companies, and our website's crashed in the middle of the pitch. I had you people watching,
and it's hella embarrassing. But you've got to keep pushing through that. So I think if you
know that you're facing a... It's a real problem that you want to solve. It's a real business
opportunity. It's a real thing there that people are struggling with one thing, they hate it,
and they'll pay you to fix this problem for them. And you're going to build this company,
you're going to build this product, the solution, or whatever it is. It's like, build it. Just do
it. And if you haven't got the means to devote all your time to, that's totally fine. I mean,
I was studying part-time when I started work. I was studying full-time when I started Disconnect.
So you can still be working full-time and build things on the side. At the end of the day, it
does come down to a bit of sacrifice. There's only so many hours you have in your day as a
human being, and you have to allocate those. So one thing that kind of sucks is I've had
a lot of social time for myself. My relationship's all systematically failed one off the other,
because I'm spending my evenings at the office. I'm getting home at 10 o'clock every night. My
weekends, I'm working. I'm so obsessed with this company that I choose this company every single
time of everything else. My friendships have suffered because of it. My friends don't see
me for months at a time, because this is what I do. I don't go to parties because I want to work.
So sacrifice. My health has suffered sometimes, because I'll be drinking a lot of coffee,
or my co-founder starts stress smoking, or I can't exercise every day anymore. I used to love
running and stuff. Now I have to squeeze exercise whenever I can. You don't sleep as well. Your
stress levels, I started getting psoriasis, actually, which is a stress-related skin rash,
like eczema, because of it. So it's set your conviction. It's like this do-or-die kind of
attitude. You will do this no matter what it takes. You will do it. No matter how many times
people say no to you, or you mess up, or things go wrong, or you suffer for it, or it doesn't make
sense, or you don't want to give up, or you're tired. You just will do this. You will take
one step at a time. And then there's one step at a time. I mean, my one friend's got this quote that
says, how do you eat an elephant? One bite at a time. So you just got to go at it. I mean,
the first video I did was a two-page website built on Wix or something, whatever. It was
one of those basic iterations you can do that provides value to that, and just start, and go,
and go, and go, and go. And it's like, do not ever give up, because you will get it wrong,
absolutely. But if you keep going, you'll eventually get it right. And that's all you
see one time getting it right. I read this thing the other day about Pablo Picasso,
and apparently he produced 50,000 artworks in his lifetime. And all of those, only 100,
are considered to be masterpieces. I mean, those odds are insane. Most of his work is trash, right?
Every now and again, he really hit the nail on the head. And that's with everything. The famous
Edison story about the light bulbs and stuff, it's just like, don't give up. People are like,
they hit one tummy ache, and they're like, oh, okay, I'm going to stop. No, come on. We have this
phrase that Greg and I'll say to each other, if we start whining, eat a spoon of cement and harden
the fuck up. Just don't give up. Keep going at it. You will get it right. Unless the market
really changes. Let's have an example tomorrow, all the universities decide they're all going to
build a million residences overnight. That's the end of our company. So then you give up,
because things are working. There's an actual reason why. I don't know. You want to make,
I'm trying to go to a ridiculous business. You want to sell gloves to eat ice cream with,
because ice cream was melts in your hands. No one's going to buy that product. It's a
shitty product. If you're making ice cream gloves, you probably should give up.
But short of that, figure it out. And the good bit is always, if you're facing the problem,
and other people are facing the problem. And the other night, I remember I have in South Africa,
you get prepaid water. You get prepaid water. And I didn't even need this as a thing, but the
new part I'm saying is prepaid water. So it's like 11 o'clock at night. I'm in the shower,
washing my hair and my water cuts off. I'm like, are you kidding me? It's like looking around the
water meter thing and it's like, you're out of water credits. I'm like, that is so bizarre.
But whatever, I can surely buy it online. That's been apt to buy water credits,
because you can buy electricity in your banking app. So as long as we're buying the app,
and there's no way to buy water credits, I'm like, no way. So I googled this, and I'm like,
look at it online. It has to be a way for me to buy water online. There's these credits,
and there's no way to buy it online. I was like, what the hell? So I look at this company's website
and read through the things. And you can only buy it from a pick and pay, which is kind of like a
grocery chain. Yeah, grocery chain. Yeah, it's kind of, yeah, it's cool. And they're normally
everywhere, but now it's like 11 o'clock at night and they're all going to be closed. So I'm like,
what the hell? So I'm looking online and there's a 24 hour mini pick and pay,
like fairly close by in C points, which is like a 20 minute, 15, 20 minute drive. So I'm like,
okay, let me just shampoo my hair. Tell her, let me just go to pick up hair, whatever. Get in my
car, drive there. I get there. They're like, sorry, because of the load shedding, the machine's
being down. You can't buy water credits until tomorrow. I'm like, are you? No. Raging, but
there's like nothing I could do. Like no one could help me in that point. Like I literally would have
paid like any amount just to have a shower at that point in my apartment. All I wanted. I mean,
I could have jumped to my German show and shot it, but I just wanted to be in my apartment. Like
there's any amount of money I would have paid there. Like if an entrepreneur had said, here's
the way you can do it. I mean, that's a very niche situation. There's everyone loves to complain.
Worst thing you complain about all the time that you hate, solve their problem, figure it out,
like replicate it, sell to the people. You have a business. Believe in yourself. Don't give up and
solve real problems. Great advice. Thank you so much, Alexandria, for coming on the show. I think
Diggs Connect is a super cool business and hopefully listeners learn something and are
inspired. Can you tell them where they can go to learn more about what you're up to at Diggs Connect
and follow along with your story? So you can find us on our website is just DiggsConnect.com.
That's D-I-G-S-Connect.com. You can follow us on Twitter, Diggs Connect, Instagram,
Diggs Connect, Facebook, Diggs Connect. You can WhatsApp us if you want. We love Chinese
people time WhatsApp, literally. If I'm like constantly for now, go like on WhatsApp, like,
hey guys, change our users. Yeah, like any and every social media platform you find us there.
All right. Thanks again, Alex.
Cheers.