I’m now in my seventh year as founder and CEO of Banhoek Chilli Oil Company, and it’s been seven years of scars, mistakes, surprises and lessons from actually founding a business from scratch—with no experience in the industry and in a category that barely existed. Here are some of my stories and lessons:
The Big Five
There are many things to take into consideration when building a company, and it can all get pretty overwhelming. But if you initially focus on “The Big Five”—a term used to describe the most dangerous animals in Africa—you’re 80% of the way there (the 80:20 rule is very important in life) and have a decent chance of survival.
Not an easy feat. Few survive.
1. Solve a customer need
Sounds obvious and textbook-ready, but not really in practice.
At the end of the day, a customer has to pay out of limited resources—resources that many other companies are also vying for—to buy something new. They need to believe it is worth taking the risk that it might satisfy their needs.
There are many ways to solve a customer need:
(i) Make something easier that already exists.
Big companies that dominate a category can sometimes take their eye off the ball as they get bigger. This creates an opportunity for new entrants to make the offering more customer-friendly.
(ii) Create something that doesn’t exist.
Here you’re betting that the customer hasn’t thought of it yet and that bringing it to market will create demand. Plenty of examples out there, from the internet to smartphones.
(iii) Something in between.
That’s where I step in. And this is my “solve a customer need” story…
The inspiration
I’ve wanted to be an entrepreneur since I was a kid and did all sorts of things at school to make some extra cash. One of my more entrepreneurial ventures was taking my little sister around the neighbourhood to sell her terrible paintings and drawings. The buyers, I suspect, were motivated more by pity than artistic appreciation.
Later, once I started working, I invested in a number of little startups over my career. None were particularly successful…
After a 30-year corporate career, I wanted to fulfil my entrepreneurial dream.
The only question was: what?
First lesson—don’t force it. It will come. You’ll see why later.
Weirdly, I don’t like spicy dishes, except wasabi (I’m obsessed with sushi), English mustard and chilli oil.
The problem with the latter was that there was no consistent brand—something like Tabasco is for chilli sauce. The chilli oil category was and still is minute, at least outside Asia, where the offering is more commonly a chilli crunch.
What existed locally was mostly some homemade attempt, usually sitting on the table at a pizza restaurant, with varying degrees of quality and consistency.
Enter my brother-in-law Adi—a real foodie.
Over one Sunday family lunch, where he invariably cooks, I complained about not being able to buy a decent chilli oil in the shops.
He simply said, “I’ll make it.”
Sixty-plus combinations of chillies and edible oils over three months later, we had what is still, unchanged to this day, The Original.
Initially, it was just for our own use. But then friends started asking if he could make some for them. Then friends of friends started asking.
I thought a good side hustle—and a way to teach my teenage kids some entrepreneurial skills—would be to turn it into a proper little business.
So we converted our garage into our factory. The cars moved outside, I’m afraid.
We started selling to friends and at weekend markets.
The kids still joke about the free labour to this day.
Eighteen months later, I started to see the potential for the “Tabasco of chilli oil.”
So, in January 2020, I quit my 30-year financial career and started full-time at Banhoek Chilli Oil.
In the real world.
Not in the cloud.
Some lessons from this:
1. Don’t rush it—it will come.
Sometimes you need to let things develop rather than forcing an idea because you’ve decided you want to be an entrepreneur.
2. Do something you are passionate about.
Another textbook comment, but perhaps not in the way everyone thinks.
You can create an app that solves a fintech problem without being a financial or tech fan. You don’t necessarily have to be passionate about the industry. You need to be passionate about solving the problem and building the business.
3. Hold your nose and take the plunge.
Before you do, there is a lot you can achieve to get to a point of conviction while keeping your current job and burning the midnight oil—and weekends.
Our first 18 months were exactly like this. We all had full-time jobs in completely unrelated fields while building the business on the side.
It’s a lot easier to take the plunge when you’ve already tested the water.
4. Don’t let endless market research become an excuse for not launching.
You can spend years researching a market and still not know whether people will actually buy your product.
Anecdotal evidence is a perfectly good starting point.
If people keep asking you where they can buy the thing you’re making, it’s probably worth paying attention to.
5. You have to have a good product.
We went through 60-plus combinations of chillies and oils before settling on our final product.
Along the way, it’s tempting to just go, “This will do.”
Sometimes it will.
But, you also don’t have to create the perfect product before launching. You will continually refine it as you go.
The trick is getting the balance right between good enough to launch and good enough that people actually want to buy it.
2. Attractive Packaging
(i) Customers buy with their eyes.
Your first category of customer is the risk-taker. These are the people always looking for new ideas and products and willing to trial something on a whim.
You need this small group first.
They are the early adopters who give you your first bit of traction, before you can start convincing the next group: the risk-averse customers who need evidence before buying.
And that second group is the vast majority.
(ii) Clearly state what it is.
Use as little copy as possible on the front.
Customers encountering you for the first time don’t want to spend five minutes figuring out what your product actually is.
There are thousands of products and brands competing for attention during our limited waking hours. You have a few seconds to make your point.
Don’t waste them.
(iii) Tell a story.
Everyone likes a story.
A good story connects customers emotionally with your product and gives them a reason to care about something that might otherwise just be another bottle on a shelf.
You won’t always have the space, but if you can get the story on there, do it.
(iv) Get the compliance right.
There is plenty of information that legally needs to be on your product.
This is not the place to be creative.
(v) Don’t obsess about perfection.
Again, don’t wait for the packaging to be perfect before launching.
The first year of customer feedback will inevitably lead to changes in how your product looks and feels anyway.
You will think you have nailed it.
Your customers will politely tell you otherwise.
Listen to them.
3. Money
(i) Money is the lifeblood of an organisation.
Just like the body.
And it is also one of the main reasons businesses fail—not necessarily because the idea is bad.
You can have a great product, a great market and a great team and still run out of cash.
The bank, unfortunately, has very little interest in your vision.
(ii) If you think you’ll break even in your first year, dream on.
It does happen, but it’s more like winning the lottery than a sensible business plan.
My advice is to plan on not making a profit for five years.
That doesn’t mean you need five years of cash sitting in the bank. In fact, having too much cash on day one can create its own problems.
But you need to prepare yourself financially for a long haul.
Ideally, have enough runway to give yourself some breathing space. If you can’t, you may have to burn the midnight oil while holding down another job.
We did.
(iii) Once you have proof of concept, raising money becomes a fundamentally different conversation.
Before you have proof of concept, you are largely selling a dream.
Afterwards, you have something people can see, touch and hopefully buy.
That doesn’t make raising money easy.
It just makes the conversation a hell of a lot more interesting.
4. Tenacity
This is possibly the most important quality you need as an entrepreneur.
You need doggedness.
Because none of the above—and none of your carefully constructed plans—will pan out exactly as planned.
Things will go wrong.
People will let you down.
Customers will disappear.
Cash will get tight.
Something you thought was brilliant will turn out to be a terrible idea.
And occasionally something you thought was a terrible idea will work brilliantly.
You need the tenacity to keep going through all of it.
There’s a reason most people would rather work for a big company.
Security.
As an entrepreneur, you’re largely swapping security for uncertainty.
You need to be comfortable with that.
5. Time
No one can predict the future.
And as a startup, you have virtually zero chance of predicting yours.
Therefore, you need time.
How much?
How long is a piece of string?
We formally launched on 1 March 2020.
Straight into COVID lockdown.
For the next two years, we pretty much twiddled our thumbs.
Imagine starting a business and your country going to war for the next five or ten years, as has happened many times in recent history.
There is absolutely nothing you can do about events like that.
Except survive.
And that’s the point.
Sometimes the best strategy is not to win.
It’s simply not to die.
Like I said at the beginning, there are many more things that are important when starting and building a business.
But you cannot focus on everything, and you certainly won’t get everything right when you have limited resources, limited experience and limited money.
Don’t worry about it.
Focus on the Big Five.
Survive.
Learn.
Adapt.
And keep going.
This graph below perfectly sums up the startup journey.
Kenneth Kinsey-Quick
Founder & CEO
