In April 2014 South African entrepreneur Tumi Phake clocked out for the last time from his job at Rand Merchant Bank (RMB), where he worked as a structured-lending specialist, to start his own business.
Despite his experience and having studied a BCom finance degree, it wasn’t the financial sector that Phake had his sights set on.
He is now the sole founder and CEO of Zenzele Fitness Group, a gym management business which operates fully-equipped health clubs for, and in partnership with, various large companies and universities.
Interestingly, RMB – part of the FirstRand group – was founded by three of South Africa’s most respected entrepreneurs, Paul Harris, Laurie Dippenaar and GT Ferreira. In 1977, they established Rand Consolidated Investments with just US$10,000, which later became RMB. Known as the three musketeers, the founders subsequently laid the foundations for the FirstRand empire, with today includes First National Bank, RMB, WesBank and Ashburton Investments.
Despite quitting a job at one of their companies, Phake draws some inspiration from these South African banking pioneers. “Working at a corporate was very valuable and necessary – especially around understanding the governance of running a successful business… But I always knew in the back of my mind that I wanted to have my own company that I could grow and potentially have scale to becoming half-a-billion to a billion-rand business – and that’s my vision. And if someone else has done it on their own, such as FirstRand – why can’t I give it a shot?”
Exploiting a gap in the market
South Africa has a relatively well-developed health club industry, with Virgin Active and Planet Fitness standing out as some of the prominent chains. Virgin Active controls at least 60% of the market. It was established in 2001 when Nelson Mandela reportedly phoned Richard Branson to ask him to save thousands of jobs by taking over the liquidated gym brand Health and Racquet Club.