Conventional is barely a term that describes him. Not many people can brag about snubbing funding from one of world’s most reputable e-commerce billionaires. And instead, choosing to bootstrap their business from a shabby garage, growing it into a disruptive player in fintech globally.
Meet Phiwa Nkambule. The 25 year old visionary behind a company that uses a peer-to-peer strategy to connect consumers with insurance, credit and investment opportunities. We had a conversation with this young innovator to find out some of the principles behind his success.
Tell us a bit about your career, what you studied and why you chose your field.
I’m a software developer, with knowledge in law, business and economics. I spent 2 years studying Law majoring in economics before quitting to start my first technology company in 2014. I chose to study Law because studying IT or Computer Science wasn’t an option where I come from at the time. Additionally, I wanted a degree that would give me broad options since I knew that I’d ultimately be an entrepreneur.
How did you start your business, Rivoic?
In 2014 I founded my first official tech startup from my garage. The company’s appetite was next generation technologies so we did a lot of software development in Internet of Things, Cloud Computing and FinTech. Riovic was founded in the process. I took some of the FinTech work I had done in my previous work and approached a friend of mine who wanted us to start a company together. We then started searching for financial sector problems we could solve with what we had and landed on peer to peer insurance.
One of the aspects of your business (although it’s currently in a beta version) helps others raise capital. How did you raise capital to start and run your business during its initial stages?
I don’t believe in rushing institutional investment at early stages. I’ve rejected a number of offers including one from Pierre Omidiyar’s fund, who is the founder of eBay.
Luckily Riovic was my second company. I founded a company called Cybatar first, which was a quite profitable and significant at the time. So I used it to finance the initial stages of the company. I sold some of my intellectual property and the Cybatar brand over to the guys that established the company in Kenya, and used that money to fund Riovic.
Can you share on what’s been the biggest challenge, especially as a millennial in a very sophisticated industry, in growing your business?
Being an innovator in the financial services sector is a little bit tough because of the conservative regulatory environment. The rules aren’t moving with the times and I’ve had to work around my models to fit in the current regulatory regime.
What are some of the things regarding money management that nobody told you as you were starting your business that you had to sort of learn the hard way?
You need to have some funds set aside. Most businesses don’t start making money immediately. When I started Riovic I thought I’d experience the same speed I did with my first business in generating revenue. But I was wrong.
It took the company close to 2 years to be in a position to start making money. By that time I had blown through most of the money I had on paying employees we didn’t need before that stage.
In your experience as a FinTech entrepreneur where do you see the future of investing for millennials? Do you see us moving more towards the peer investing culture similar to the sharing economy?
I see financial planners and investment brokers being replaced by robots.
Real Estate Investment Trusts (REITs) and Collective Investment Schemes are going to be replaced by sharing-economy-based models: either peer to peer or crowd-investing.
Blockchain is also disrupting stock exchanges with the entry of smart contracts. Instead of going through an IPO (initial public offering) process, companies can now launch Initial Coin Offerings and sell tokens linked to company shares bound by smart contracts on blockchain. So there’ll be an entry of new asset classes. Some of these are already happening, and some are underway.
From a leadership perspective how do you manage “being the boss” when working with people around the same age as you?
I always work with friends. I always make sure to first observe people before I hire them. This is to ensure that they are in line with my vision and can bring value to the company. It also makes it easier when there’s mutual respect in the working relationship.
What’s been the biggest and best investment you’ve made in your life?
When I was still in high school, I saved up my pocket money for 5 months and bought a female goat. I’ve since accumulated a small herd, which increases every year. With the never ending value of agriculture, personally, that investment exceeds any investment I can make now.
Lastly, best advice on money that you’ve ever received and who was it from?
A few years ago I came across a scripture that says “cast your bread upon many waters for you will find it after many days” and I’ve lived by it since.
I always try to hedge my interests with a long-term plan.