Lebo Gunguluza is an influential innovator and the ultimate “breakthrough entrepreneur”. He has overcome the odds that were stacked against him from the start and broke the boundaries by starting a multimillion rand empire without funding and by creating a revolutionary organization with a group of successful entrepreneurs to help aspiring township and rural entrepreneurs start and grow successful businesses. Lebo Gunguluza achieved his first goal, at the age of 27, when he made his first million rand through a series of entertainment events and activities that redefined the possibilities of success.
Lebo Gunguluza’s first experience in the world of media and business was with SABC, selling advertising space on black radio stations. This is where he developed a passion for the media industry. Before long he was promoted as Brand Communications Executive and spent most of his time designing programme packages that the advertisers bought into. He then moved through to Metro FM, ending up as Marketing & Sales Manager, and was sent to USA to attend a broadcast and media training course. On his return, he joined Herdbuoys as Accounts Manager, where he managed key accounts like SA Breweries, Metro FM and the return of Hush Puppies to South Africa. Gunguluza’s upwardbound career came to a screeching halt in 1997 when he embarked upon a process of self-discovery that resulted in his resignation from Herdbuoys. “I knew I was going to be an entrepreneur”, he says.
“I had made the decision to take responsibility for myself and had decided that I was not be surviving from hand to mouth in a new democracy with great opportunities, when I also needed to support my family in Port Elizabeth who were going through a rough patch.”
Entrepreneurial Spirit: Lebo Gunguluza’s entrepreneurial drive secured his first business deal with the owner of a night club called Insomnia, where he put together entertainment attractions and marketed them in exchange for a percentage at the door. The success of this deal made him a wellknown promoter in entertainment circles with a reputation for organizing the best parties in Johannesburg. He used this opportunity to partner with YFM, a new youth radio station at that time, conceptualized major events that made him a big player and helped him reach a peak on his financial success through his sold out youth events at Newtown’s Electric Workshop. The news of Gunguluza’s success spread through the entertainment industry like wildfire and sparked an army of young budding entrepreneurs all wanting to start similar businesses. He responded to the imitators by establishing Gunguluza Entertainment, where he diversified his business interest by starting an independent record label and artist management unit which led him to form strategic partnerships with key promoters.
He invested most of his resources on these new initiatives but the return on investment was never realized. The market was also very fickle and unreliable, and the promoters were not helping either with their dodgy operational ethics.
This was not enough to sustain his business. By early 1999 his income had slowly petered out and he was left burdened by debt. He was forced to sell his car and close all his account and had to bear the humiliation of being blacklisted with the credit bureau. Things got so bad that for a while he had to rely on his family to pay his rent. He lost weight simply because he could not afford to buy food.
It was in this, the darkest time of his life, that Gunguluza learnt three priceless lessons in business by which he has lived ever since. These were the importance of working with a good paying market, managing cash flow and the value of planning in business. “This was a light bulb moment in my life,” says Gunguluza. “As strange as it may sound, it had never occurred to me that I should carefully manage my cash flow or even plan my business.” It was also during this time of poverty that he asked himself a critical question “Why is he so broke, and yet famous figures such as Richard Branson, Donald Trump and the Onassis of this world were so rich.” He made a decision that day to go read about these guys. He spent endless hours at the CNA, reading biographies of these billionaires, and from time to time being chased away by staff members for not buying the books.
This learning phase inspired him to continue his entrepreneurial journey, with two great lessons on hand, the first one being that “Whatever business you go into, you must love it and know it like the back of your hand” and the second lesson being that “You must be its number one salesperson and that all companies are always looking for the best salesperson to improve their bottomline”. Instead of allowing depression over his failure to engulf him, Gunguluza decided to start again from scratch and look for a new business opportunity that avoided the pitfalls of his last business. “This time I was looking for sustainability in a business,” he says. “I wanted to target a more stable clientele than before (a good paying market)”.
The GEM (Gunguluza Enterprises & Media) Group of Companies was born as a multimedia and communication company with seven business channels namely: a television production company; a training and development company; a publishing company which produced amongst other publications a countrywide student newspaper called Campus Times; an events company that launched the Eastern Cape Awards, the South African Education Awards, the Soweto Awards and a number of major conferences.
He further partnered with Uhuru Communications, the publishers of SAA’s Sawubona magazine, who also publish an arts & recreation magazine called Rootz and a campus publication Student Choice. He solidified his partnership by successfully launching a new publication called Municipal Focus, which covers the business of Local Government with a nationwide distribution to municipalities and government departments.
He also took on an active role as a Commercial Director and had to set up the Johannesburg office to extend the publishing footprint in South Africa and Africa. He further secured the ultimate government publication that targets top government officials called Public Sector Manager to strengthen Uhuru’s portfolio of power magazines. He further initiated the publishing of the Metro FM publication called Metro Live, Joy of Jazz and Loocha under the Uhuru stable amongst other initiatives. To strengthen his publishing interest, he partnered with Realm Digital to drive his publishing interest into digital publishing. Mr. Gunguluza further acquired an interest in Ezweni to form the first 100% black owned magazine distribution agency in South Africa.
Gunguluza has also partnered in a R6,2billion development deal in Gauteng, which is 10 minutes away from the OR Tambo International Airport. The first phase of this development kicks off in November 2016 with a R330 Million Hotel. His hospitality interests are activated and marketed under Izani Hotels, a wholly owned division of the GEM Group. In 2011, he further partnered with the Premier Hotel Group, to invest in new hotel developments in Bloemfontein and Polokwane.
His interest in Events and Communications remains strong, with the Launch of Intouch Africa and Intouch Events Consulting, a specialist events and communications agency which has given him the ultimate position of being the most powerful 100% black owned events production house in South Africa, with over 42 corporate and government related events a year. In 2014, he also launched GEM Capital, the Gem Group’s venture capital and private equity arm, which is already involved in a number of deals including a R230 Million mining venture in the Northern Cape and R4.2 billion rand retail project in Ballito next to the King Shaka International Airport. Gem Capital in partnership with Pastrasncor has secured an exclusive distribution deal with an international Defence Group and will be launching that division in February 2014 as a national operation.
To date Gunguluza has learnt a great deal about partnerships, and believes one should not reinvent the wheel, but also learn and build on opportunities that already exist. He is the cofounder and President of the South African Black Entrepreneurs Forum (SABEF), a section 21 organisation established to promote, inspire and grow entrepreneurship in the black communities as the source of poverty alleviation, job creation and economic growth in South Africa. He is also the cofounder and Chairman of the Local Government Business Network (LGBN), a voluntary organisation established to promote the relationship between Local Government and the private sector.
Today Gunguluza heads up the GEM Group of Companies, an integrated media, hospitality and communications group that offers holistic media, hospitality and technology solutions to their clients.
SOURCE: GEM Group of Companies
