How Euphoria Telecom's CEO went from R1 million per year to R1 million per month in under 3 years

Jamie McKane

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paul5186

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"This entrepreneurial spirit drove him to start Euphoria Telecom in 2018"
"While it took Euphoria Telecom 18 months to make its first R1 million in revenue, it took only another 30 months to increase that to R1 million per month."

what?
 

Okty

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Same here: what? Some time bending wizards here.

Wonder if should not be 2015 in stead of 2018.
 

flarkit

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So did HIS salary jump to R1mil per month, or did Euphoria's TURNOVER jump that much? Seems like a small-yet-significant difference, no?
 

elvis_presley

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When building a business make sure you receive income before paying major suppliers.

Not sure I can decode this advice - is he saying to not pay your bills until you have money to do so? Incur pentalties on them? Or just simply not pay creditors?
 

^^vampire^^

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Perhaps you could rent the CEO for 1 mill a year and now he costs 1 mill a month.

Terrible article!
 

georgegolding

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Not sure I can decode this advice - is he saying to not pay your bills until you have money to do so? Incur pentalties on them? Or just simply not pay creditors?

I am saying there are two ways to design your cashflow. Positive or Negative. Negative cash flow is the default for most businesses, paying suppliers before receiving income from sales.

The problem here is that the more you sell the less cash you have and the more you need just to sell more. It is counter intuitive - you end up running to banks for a larger and larger credit line.

If you negotiate upfront with your major suppliers to pay 30 or even better 60 days from statement, you can receive your sales income before paying suppliers. Believe it or not this can be done over a few months of paying on time, offering personal surety and always being clear and honest in your communication with them. So now the more you sell the more money you have in the bank.

This is positive cashflow and it is a game changer when building a business from the ground up.
 

Dolby

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I love articles like this and the other Teraco article. It's interesting and motivational.

Did I miss a Cool Ideas one?
 

elvis_presley

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I am saying there are two ways to design your cashflow. Positive or Negative. Negative cash flow is the default for most businesses, paying suppliers before receiving income from sales.

If you negotiate upfront with your major suppliers to pay 30 or even better 60 days from statement, you can receive your sales income before paying suppliers. Believe it or not this can be done over a few months of paying on time, offering personal surety and always being clear and honest in your communication with them. So now the more you sell the more money you have in the bank.

This is positive cashflow and it is a game changer when building a business from the ground up.
[/QUOTE]

Having been in business for a long time, and having built a successful business from the ground up, I have never seen anybody NOT try for better invoice terms, and pay near the due date. If you don't... honestly, you have a pretty rubbish accountant. The positive cashflow model is most certainly the desired default for businesses.

While clearly you need to take as few loans/overdrafts as possible, I'm not sure this is "game-changing advice" rather than blindingly obvious information that if you don't have at least that much financial sense, perhaps the entrepreneur life is not for you.
 

georgegolding

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Having been in business for a long time, and having built a successful business from the ground up, I have never seen anybody NOT try for better invoice terms, and pay near the due date. If you don't... honestly, you have a pretty rubbish accountant. The positive cashflow model is most certainly the desired default for businesses.

While clearly you need to take as few loans/overdrafts as possible, I'm not sure this is "game-changing advice" rather than blindingly obvious information that if you don't have at least that much financial sense, perhaps the entrepreneur life is not for you.[/QUOTE]

You would think so, especially after being in business for a long time and understand the playing fields. I spend time with business owners and startups in the SME space and their cashflows are horrendous. Many people start businesses without financial or business knowledge but with a good product or service idea. Often they are excited about sales and make decisions to get them, not thinking it through.

Pick n Pay has the old legacy of hurting smaller businesses cash flow as they retail your product for you and only pay you 60 days later. Its easy to float cash when you are a big gun but when starting out, it’s often the difference between surviving and dying.

I am not saying try for better terms, find a way to achieve it before putting the sales pedal down. No trying, it must be achieved through any ethical means necessary. Trying and not obtaining is not an option. It can be delayed for a few months to create trust. Money IN before major payments out. It will save your business in the first 5 years time and time again.

Its definitely not game changing advice but a crucial part of the journey to success. I don’t believe there is game changing advice but rather a number of good business practices that when run in parallel end being game changing for the company as a whole.
 
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