Jonathan Mason had one objective when he started CipherWave – build an independent network operator which can compete with the Big 5 – Telkom, Vodacom, Neotel, Internet Solutions and MTN.
This was a lofty ideal when he started the company in 2009 in a single 3m x 3m room with only one employee – himself.
CipherWave did, however, have a few things in its favour – it had very aggressive pricing and better service levels than its bigger competitors.
Another benefit was that the company owned and managed its own national network and wasn’t reliant on reselling services from the other operators.
Businesses loved what Mason offered, and it took CipherWave only 8 months to break its R1-million revenue target.
This rapid growth continued over the next decade, and the company is now one of the most successful business ISPs in South Africa.
From one room to a large business
To start CipherWave, Mason borrowed R750,000 from his dad to set up the business and fund its network operations.
Mason initially ran all aspects of the business himself, but after signing his third large customer he needed help.
Employee number 2 started after 3 months to assist with new installations and setting up a network operations centre (NOC).
Mason and his employee did everything – run a 24/7 technical support desk, do the accounts, handle marketing and sales, and handle operations.
“It started to get hectic and after 6 months we employed CipherWave’s third employee. This was the start of big growth for the company – both in terms of customers and employees,” Mason said.
The company’s rapid expansion meant that he could pay back the loan from his dad in 18 months at prime + 5%. All future funding was raised through the profits of the business.
The company continued its strong growth over the next decade and today it occupies 900 square meters of office space.
CipherWave’s biggest challenges
Mason said one of their biggest challenges was the time it took to roll out its fibre network and commission its data centre.
“After our initial funding was depleted, we had to build up a new fund through profits before we could continue with the commissioning of the network,” Mason said.
“It was balancing act between paying salaries and suppliers and investing in the network.”
Mason said that apart from the R750,000 loan from his dad the company has been debt free, as they only used their profits for growth.
“Some might say it’s best to use a bank loan to finance growth. However, when it’s your house up as a guarantee you see things differently,” he said.
Mason attributed the company’s success partly to the fact that every penny that was spent felt like the cash was taken from his personal wallet.
“We were therefore very focused on watching our expenses and driving sales to support our ambitions,” he said.
CipherWave CEO Jonathan Mason’s tech and business choices
CipherWave CEO Jonathan Mason shared his tech and business choices with MyBroadband.
What was your first ever business?
At the age of 16 I was based in the United Kingdom where I started a company called “Mason’s Garden Service”. I bought a lawnmower, created business cards and started to knock on doors in my local neighbourhood.
I picked up some clients and was pleased when I signed a contract with the local municipality to cut the grass along the walkways.
What was your job and what was your salary?
“Chief Grass Cutter”, earning £15 (around R225) per hour.
How did you get into the tech field?
At the age of 20, I started as a salesman selling LG PABX telephone systems. At 22 I started my first tech company – ETL Communications – selling PABXs and Least Cost Routing.
What laptop do you use?
Apple MacBook Pro.
What smartphone do you use?
Apple iPhone X.
What is the best gadget you have ever bought?
What is the worst gadget you have ever bought?
DJI Phantom Drone. It is very expensive, and I hardly use it.
What was your best ever investment?
Building a house.
What was your worst ever investment?
What is the best business advice you have ever received?
“Earn Their Trust” – Whether it is a customer, supplier or an employee, by earning their trust you will find new opportunities and cooperation to achieve your objectives.