#79 The Accidental Entrepreneur – banking, retrenchment and building GCE Business Solutions with Gavin Ellis

TRANSCRIPT: THE bizval PODCAST
Guest: Gavin Ellis, Founder
Host: Graham Stephen, CEO and Co-Founder, bizval
LinkedIn: https://www.linkedin.com/in/gavin-ellis-25074a4b/

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[00:00:42] Graham Stephen: Welcome to the bizval Podcast. I’m Graham Stephen, the CEO and co-founder of bizval, and our mission is simple. We want every business owner to know what their business is worth, and what they can do today to make it worth more tomorrow.

[00:00:55] Graham Stephen: My guest today has spent more than 35 years in commercial banking, Standard Bank, APSA, Barclays Africa, where he filled numerous executive roles, client acquisition for business banking, you name it, he’s probably done it. And then in his mid-50s, he was retrenched.

[00:01:15] Graham Stephen: But he didn’t sit on his backside, so to speak, and wallow about. He started GCE Business Solutions, which is a banking, funding, and debt advisory firm, and that’s now 7 years in. So, Gavin Ellis, welcome to the show.

[00:01:29] Gavin Ellis: Thank you very much. It’s a pleasure to be here.

[00:01:32] Graham Stephen: Fantastic. Well, I mean, I don’t think a lot of listeners, and we do have an international audience on this, so, but I mean, as a starting point, you’re also from what is known as Ibacha, or Ibay, or Port Elizabeth, so we both have something in common from our background. But I think let’s just start…

[00:01:52] Graham Stephen: you know, at the beginning, let’s take us back to, sort of, the banking years. Way back in March 1983, I’m sure before many of our listeners were even born, you joined Standard Bank, which is one of South Africa’s largest banks, as a forex clerk.

[00:02:10] Graham Stephen: So maybe just tell us a little bit about the journey. How did you end up in banking? And what did, you know, spending 35 years of climbing through the ladders of StandardBank and APSA actually teach you, teach you through that process?

[00:02:25] Gavin Ellis: Cool, so I actually… and probably lots of us, that landed up in banking, we sort of fell into banking. Banking wasn’t our first choice and whatever. I started Varsity, wanting to be a CA, and then realized very quickly I probably wasn’t clever enough to do that, and so on. And I also did a varsity job, in June of my first year at an auditing company. I thought, –

[00:02:46] Gavin Ellis: This is not for me. And then… and then, I wasn’t the world’s greatest student, let me tell you, so… What happened is I was playing soccer for the varsity team, and then in my second year, I didn’t really do that well, and I had… I only had varsity 3 times a week, so I then started working with… at Standard Bank then as a teller. So I started as a teller.

[00:03:07] Gavin Ellis: World’s worst teller. I was bad. Wasn’t very good. I could never balance my things, and I used to work on a Tuesday, Thursday, Saturday morning, and so on.

[00:03:16] Gavin Ellis: And then I flunked out completely out of Ostein, and I thought, what I’m going to do now, I thought, okay, I know Standard Bank, because I worked at Standard Bank as a teller, and then I went to the HR person, and I said, okay, now I need to get a job, full-time job. So… so what had happened is, well, my brother-in-law was a psychologist, and he took me through one of those psychometric tests.

[00:03:34] Gavin Ellis: And interestingly enough, it says, Numbers? Hmm, maybe not so much, but people. Good at people.

[00:03:40] Gavin Ellis: So, of course, when I get to the bank, they put me through the same psychometric test, and I think, okay, well, the bank is about numbers. So every time a number question came up, I said, love it, love it, love it, you know, so…

[00:03:53] Gavin Ellis: So anyway, I got a job, as you say, at Standard Bank in East London, the small branch there. We were 18 on the staff, as a forex clock. My introduction to banking was, I was with a guy

[00:04:07] Gavin Ellis: for 2 days, and he was teaching me how to… remember, this is my first job, teaching me how to do, forex, you know, Vostro, nostro, and all those things.

[00:04:16] Gavin Ellis: Then he said, after 2 days, he says, well, I’m going to my next stop, so cheers, here’s the book, you must just do it. And I’m telling you, I did those things, and in those days, you didn’t have… so you typed up whatever, I passed it to my supervisor, she would just throw back the stuff, say that’s wrong. I didn’t… she didn’t tell me what was wrong, so I had to learn…

[00:04:34] Graham Stephen: There was no internet in those days, it was manual ledgers, it was all of.

[00:04:38] Gavin Ellis: So good. So you go through the thing, and you think, oh, there’s the error. They’re not… okay, and I send it back. Then she throws it back again. The point of the matter was that eventually I knew the forex regulations better than what she did, because I had to research it. That’s part of what banking teaches you, to be detail-orientated. And…

[00:04:57] Gavin Ellis: So, during my banking career, then I went into the army, came back out of the Army, went back to… went to Port Elizabeth, so from East London, went to Port Elizabeth, worked in manager’s department there, and was a manager’s clerk for one of the,

[00:05:09] Gavin Ellis: one of the consumer guys, and then I became the manager’s clerk for the commercial manager. And when I took over, the guy that I took over from, he says, listen, you know, so I worked for a guy called Barry Ferreira, and many people who are stand-up, ex-standard bank guys might know him, he was quite a legend. He’s passed on now.

[00:05:24] Gavin Ellis: But he was the type of guy that… he didn’t take any shit. I said I wouldn’t swear, but there’s one swear word, but anyway. So…

[00:05:32] Gavin Ellis: So, you would go, and he said to me, if you’ve got your point of view. whatever you do, when you’re going to bury, and you’ve got a point of view, just stand on it, and so on. But you must be prepared. And that was another thing. Be prepared for whatever. So, preparation was a key. So, out of that, then I went from, managed the partner, went into advances or credit division in Port Elizabeth for 3 years.

[00:05:53] Gavin Ellis: So I can crunch numbers with the best of them, so here’s the number story, so I know, you know, but numbers is not what.

[00:05:59] Graham Stephen: You fake it till you make it. I mean, from manipulating the psychometrics, I guess nowadays, with AI and all that, you probably wouldn’t… you wouldn’t get away with that, but…

[00:06:07] Gavin Ellis: No.

[00:06:08] Graham Stephen: Maybe you could.

[00:06:09] Gavin Ellis: So anyway, then I became the top credit analyst in advances. I got chosen for the bank’s overseas development program out of credit division there, and so on. I finished my degree off, I went back and did my degree part-time, did my banking diploma, also did the MDP and the EDP through UNESA Business School. So.

[00:06:31] Gavin Ellis: They… the bank… educated me. Really grateful for that. Went overseas with them for 3 months.

[00:06:38] Gavin Ellis: Came to Joburg, started at Hyde Park Branch as one of the managers there, then Jan Smarts Avenue, then I came back to P as the head of, SME for, Eastern Cape. So, I ran that for two and a half years, then I came back to Joburg, then I ran business banking suites. So, in Fox Street, ran a suite there, and business or commercial banking, ran a suite there for 6 years.

[00:07:02] Gavin Ellis: We went to… from Fox Street out to Bedford, they’re not decentralized to Clearwater, close to my house.

[00:07:08] Gavin Ellis: And then, towards the end of 2009, they called me in, they said, no, we want you to head up acquisition for business banking for the province. So, end of 2009, we’re just about hitting that financial crisis. And I was saying, no, but guys, you’re setting me up for a failure here. No, no, you’ve got the networks within the bank, you’ve got outside networks, you’re the right personality.

[00:07:28] Gavin Ellis: So I ran that for about 3 years, and it was… in actual fact, you look back, and that was probably one of the main changing points in my life, because you got exposed in the banking world. You got exposed to everything, there as well. And people would call you from head office, say, we’ve got this client, go and see him, go and, you know, and all that. So, got exposure to a lot of people, which then allowed me to go to…

[00:07:50] Gavin Ellis: to Absalom Barclays Africa as the Executive Ed of Client Acquisition for their business and commercial banking division. So both for SA, and then on the, on the, on the continent,

[00:08:02] Gavin Ellis: If you’d have said to me when I was… so I was a standard bank for 30 years, I was there for a long time. If you’d have said to me, which bank would you go to?

[00:08:09] Gavin Ellis: after Standard Bank, APSA wouldn’t have been my first choice. But you know what? I love my time at APSA, it was really great. People there are fantastic, and so on. They’ve had a lot of bad press over the years, but I think Kenny Fickler now, with getting a lot of the team back there, is gonna do a superb job. So I had a great time, but then, of course, Barclays UK decided to leave, and with the restructure, you know, in banking, you go through lots of restructures.

[00:08:33] Gavin Ellis: Probably in 35 years of banking, I went through about 10, 10, 11 of them. They like musical chairs. If you… if you… the music stops, you haven’t got a chair, then thank you very much, you’re out of the game. So anyway, then I… that’s when I got retrenched, but we’ll talk about that a little bit more, a little bit later, I’m sure.

[00:08:51] Graham Stephen: If I may, I’ll sort of stop you for a second and just…

[00:08:54] Gavin Ellis: Oh, sorry.

[00:08:55] Graham Stephen: recap on a couple of lessons in there. You know, I think when we talk about banking now, people see an app. You know, a lot of the younger, a lot of the younger listeners, but back in those days, I mean.

[00:09:06] Graham Stephen: you know, I also had the, you know, spent a number of years in banking. Little side note, my first boss at Stanabank, who you’ll know, was a guy called Graham Wallet. I mean, how’s that for nominated determinism, if there ever was one? But,

[00:09:22] Graham Stephen: You know, so I learned… and in those days, banking wasn’t just a computer system. You had to know the ledger, so it was an opportunity… you had to learn. You had to go in, you had to actually…

[00:09:32] Graham Stephen: Like, as you say, research, so you couldn’t just come in and, you know, run the numbers.

[00:09:38] Gavin Ellis: Yeah.

[00:09:39] Graham Stephen: So, I think when you talk about banking now, it’s a very different, and particularly a retail banking, a different environment. The other thing I just want to touch on is that

[00:09:47] Graham Stephen: you know, you… you spend time both in sort of back office roles, where you kind of had to learn the mechanics of things, and then also, as you spoke about, that shift in sort of the front office, like, going out there and doing sales. You know, sometimes

[00:10:00] Graham Stephen: People think they’re such big machines, no matter what, you know, but you learn sales, and that’s the heart of any business, right, is actually selling, engaging people, all those things. So you had that full spectrum of, you know, probably any job that you could do in a bank, you had some sort of exposure to.

[00:10:17] Graham Stephen: Yeah. Before I talk about the retrenchment, I mean, one of the things I just want to touch on briefly is you also did a bit of work across the continent, and I think that was mainly when you were at APSA, so Botswana, Ghana, Kenya, Zambia, Uganda, and I just want to very quickly sort of touch on that, you know, through that process.

[00:10:36] Graham Stephen: you know, what did you learn that you… that you… that you couldn’t learn just sitting in a office block in Santon, or Joburg CBD, or whatever the case? Maybe just spend a couple of minutes chatting about that.

[00:10:47] Gavin Ellis: Yeah, sure. So, when I went from Joburg to P, I was told by somebody, listen, you know, the pace is going to be different down there. You can’t go at the pace Joburg goes to, but we’re sending you there for a reason, to bring them up. So, if they’re at that pace, and Joburg’s that pace, you’ve got to bring them halfway, okay? Same thing in Africa. So, the pace of

[00:11:10] Gavin Ellis: work and so on is a little bit different there. Might have changed, remember, I’ve been out of it for 7, 8 years now.

[00:11:16] Gavin Ellis: But… I mean, the first time we went into Africa to do what we did, we went into Gaborone.

[00:11:23] Gavin Ellis: I saw more clients in 3 days. That 4 account executives have seen in the last month.

[00:11:29] Gavin Ellis: You know, physically going out to see clients. They might have found clients or whatever, but physically going out to see clients.

[00:11:35] Gavin Ellis: I used to say to the guys, guys, you cannot do stuff sitting beyond your desk. You need to go… so… so I would fly into Africa for a week, to Accra, Ghana, or wherever, fly… fly out Sunday… Sunday lunchtime, and then meetings would be scheduled from 10 o’clock Monday

[00:11:50] Gavin Ellis: all the way until Friday afternoon, and I would want meetings, and we’d do suppers with clients in the evenings, and so on. We probably saw 20, 25 clients in a week, you know, and so on.

[00:12:02] Gavin Ellis: So, that was a bit of an opening… an eye-opener for them, but I said, but you’ve got to get out there. So, that was one of the things. The other things, when you get into Africa, don’t go there with a know-all attitude.

[00:12:16] Gavin Ellis: that because you’re from South Africa, you know, because South Africa does have a bad rep on the continent, that they… everybody from South Africa thinks we’re the best, da-da-da-da-da, whatever, then you go in there with this arrogant attitude.

[00:12:29] Gavin Ellis: Don’t do that. Go in there, understand their cultures. So, one of the things that I always say to the guys, when we go out during the day, when we go for lunch.

[00:12:37] Gavin Ellis: We go where you go. Not to… they said, no, we can go to KFC. I said, I can eat KFC in South Africa. I said, go where you go. The one time in Accra, we went to this one place along the side of the road, and we ate tilapia fish.

[00:12:52] Gavin Ellis: It was so burny. And I was sweating. They took videos of me sweating, and they sent it back to the team.

[00:13:00] Gavin Ellis: But you do those type of things to assimilate yourself into the culture, if, you know, because otherwise you can’t… you can’t just do it from the outside. So, you know, so… so we did those things. The one time I almost…

[00:13:12] Gavin Ellis: I almost killed myself eating fish in… also in Ghana, because it came very bony. And I thought, yeah, if I… if I swallow one of these bones, it’s gonna be a problem. So… so again, don’t… don’t be a know-all.

[00:13:26] Gavin Ellis: bring their pace up, but not to the level that you, you know, bring them up, and so on. The other thing that we went into clients’ businesses, A, they were very grateful that we’d gone… they said, Jeepers, I must be really, you know.

[00:13:40] Gavin Ellis: how can I put it? You know, one of the top clients, because you from Joburg are coming to see me, so they were, they were incredibly grateful. The other thing is, they were sick.

[00:13:49] Gavin Ellis: Some of the businesses were second and third generation businesses. Dad was still there in advisory capacity, but they would tell me, but Barclays is my dad’s bank. It’s not my bank. What are you going to do differently? You know? So we had to convince them that we would do things differently, et cetera, et cetera.

[00:14:06] Gavin Ellis: But then you would listen to them and say, what do you want differently? You know, and try and change it that way. So you’ve got to listen. You know, when you’re going to these African markets, you must listen to them.

[00:14:17] Graham Stephen: Well, I think, Gavin, I mean, there’s a few things in there, whether it’s Africa, or it’s Eastern Europe, or it’s USA, wherever. I mean, the one key learning is you, if you’re coming in as an outsider, you need to understand first, or seek first to understand before being understood. The second thing is…

[00:14:33] Gavin Ellis: guy. Yeah.

[00:14:34] Graham Stephen: you know, one of your key learnings is just the importance of relationships. And nowadays, it’s, you know, with AI and LinkedIn, like, all these great tools and what have you, sometimes people, kind of underweight relationships. At the end of the day, it’s about…

[00:14:47] Graham Stephen: people, and recognizing and understanding people. I mean, we could probably have a podcast just on experiences in Ghana. I’ve also been fortunate to spend a lot of time in Accra and Nairobi, and I’ve also got a similar fish story in Accra.

[00:15:03] Gavin Ellis: So you know it, you know it.

[00:15:04] Graham Stephen: You know, for anyone listening, you go, you get these dry hangers of tilapia, and they, like, pick it off the… pick it off the hanger, basically, and that’s what you’re having for lunch. But, yeah, so some interesting stories, but great times.

[00:15:17] Gavin Ellis: Yep.

[00:15:17] Graham Stephen: So, Gab, let’s move on. Okay, so now you’re sitting in March 2019, a year before COVID. I mean, none of us could have foreseen what was going to come with COVID, but you’re now executive head, mid-50s, 35 years in, and suddenly you…

[00:15:35] Graham Stephen: retrenched. Okay, so talk us a bit through that process, through, you know, that day of actually hearing that, you know, your time’s up, so to speak, and what followed.

[00:15:46] Gavin Ellis: Yeah, so… so, interestingly enough, so… so it’s a process. In a large corporate, it’s a process. So when… so, there was town halls…

[00:15:54] Graham Stephen: It sounds like Oracle, where you get a 6am email, and.

[00:15:57] Gavin Ellis: No, it’s not…

[00:15:58] Graham Stephen: that connection.

[00:15:58] Gavin Ellis: No, no, it wasn’t… it wasn’t like that. So… so what happened is that… so in the June, July of 2018, there were town halls and so on. So, so we knew what was coming, because the… the scene… so there were 24 managing executives, and I was the next level down.

[00:16:13] Gavin Ellis: 24 of them got culled down to 12, so we knew that something was coming. So, and I thought to myself, you know what, if I’m at 55, a white male, I’m probably going to be on the chopping block, and so on. So…

[00:16:27] Gavin Ellis: one of the next town halls, there were about 180 of us, now the next level. We were told, no, don’t worry, you know, there’s plenty of jobs for everybody. Two weeks later, we get Section 189 letters, okay? So now you think, okay, now, now it’s real.

[00:16:40] Gavin Ellis: So what happens in a large corporate is that the large corporate wants to chuck that process through as quickly as possible. They want to move on and so on. You as… if you’re getting that 189 yourself, you’ve got to slow it down so you can process stuff.

[00:16:54] Gavin Ellis: So, in a 189 process, what you have to do is, if they say, okay, this and this and this, you reply in writing. So you have to reply in writing. I gave them a 5-page email and a 12-page PowerPoint presentation about why they shouldn’t be taking away my job and my team, okay?

[00:17:14] Gavin Ellis: I knew they’d made up their mind, but that’s fine, because then I had to slow it down. took them 2 weeks to come back and respond, Annette, which they did, but by then, I’d got it in my head, okay, this is what’s gonna happen. And then you go into a negotiation process, and so on. And I managed to negotiate a 7-month, sort of, reassignment process, where the bank paid my salary,

[00:17:37] Gavin Ellis: I stayed at home, I was available if they wanted me. But I still had access to a lot of the buildings around the country, so I actually used to go into work at Ellis Lane and work on stuff, but work on my business.

[00:17:53] Gavin Ellis: no conflict of interest, I didn’t… I didn’t take out any, data or anything like that. I spoke to people then, I said, this is what I want to do, what do you think? And one of the things, one of the execs said to me, is that.

[00:18:08] Gavin Ellis: What do business people know you for in South Africa, Joburg in South Africa? It’s about putting together large, complex lending deals.

[00:18:16] Gavin Ellis: So that was where my… my gut was going, and so on. And I… I didn’t necessarily want to just…

[00:18:22] Gavin Ellis: take my pension, go and buy a, you know, a burger joint, and flip burgers, that’s what now, you know, so… yeah, so… so it was…

[00:18:31] Gavin Ellis: it was a shock, but it wasn’t a shock. And I was able to take that 7 months. In fact, I… what I did is I… I…

[00:18:38] Gavin Ellis: I fast-tracked that process. My oldest son went overseas in the beginning of 2018 to work in London. We were going in December of 2018 to visit him. I said I must know what I want to do by… before I go.

[00:18:51] Gavin Ellis: So I’ve fast-tracked that process for myself. You know, sometimes when there’s… when there’s restructures and big businesses will create a crisis

[00:19:01] Gavin Ellis: So, get you out of your comfort zone. So, I created that timeline crisis for myself, so I’d think clearly and fast. Because there’s no use, like, sitting around and waiting, and then two weeks before the 7 months are up, now, you know, what am I gonna do? So, I had a plan.

[00:19:17] Graham Stephen: What’s quite interesting, Gavin, is that, you know, you didn’t, as you say, you didn’t wallow in self-pity. You actually, you know, you thought about it, you structured it, it wasn’t like, oh, woe is me. But I think just, if I look at your career through the bank.

[00:19:31] Graham Stephen: You know, a lot of people… you know, if you’ve been in a bank for 35 years, okay, you were across a couple of different banks, if all you’ve done is just stayed in one job or two jobs and learned nothing new, but as you’ve described your career, it seemed like every two or three years, you were reinventing yourself in any case.

[00:19:49] Graham Stephen: Absolutely. You know, so you weren’t just sitting, being a Forex clock, and then a senior Forex clock, and then a more senior Forex clock. You kind of took the opportunity to…

[00:19:58] Graham Stephen: to actually do that. So now this was, yes, you might not have had the safety net of a salary every month coming in, but it was almost just, like, moving on to the next thing, right?

[00:20:09] Gavin Ellis: You know, and to add on to that, so when I went down to PE to head up the SME center, it was brand new. There wasn’t anything in place. So I was building a business within the bank. When I came to… back to Joburg and ran a business banking suite.

[00:20:26] Gavin Ellis: I had the smallest suite, I only had 4 account executives at the time. I was building that brand new. I had to build it up. When I went to acquisition, I had 2 acquisition bankers in Standard Bank. I built that up to 10 acquisition bankers and 7 support staff. So I was continually building businesses within the context of the bank. When I went to APSA,

[00:20:48] Gavin Ellis: I was told, blank piece of paper, we don’t have any acquisition capability, build it for us. So I built that business, you know? So, so, you know, corporates… corporates are a funny animal.

[00:21:00] Gavin Ellis: As you know, but you learn a lot of stuff within corporate. And, you know, anybody who has the opportunity to spend some time in corporate, go and do it, because it gives you certain structure, certain thought patterns, etc, etc.

[00:21:14] Gavin Ellis: If your goal is to go and do your own thing, maybe just get some structure in around how corporate works first, and then go and do something.

[00:21:23] Graham Stephen: Yeah, there’s a lot of wisdom in that, you know, and I think they’ve done studies. I said that, you know, the most successful entrepreneurs, you know, start in their late 40s, you know, so…

[00:21:32] Graham Stephen: Everyone thinks you’re going to be this young VC-funded, you know, founder by 25, and if you’re not a billionaire by 30, you’ve failed somehow. And that’s not the natural order of things. And nowadays, you know, we just talk about ageism and all of that.

[00:21:46] Graham Stephen: Is, you know, this notion of a retirement age of 60 or 63 was built in the industrial age.

[00:21:52] Gavin Ellis: Yeah.

[00:21:52] Graham Stephen: at… people are working into their 70s, 80s nowadays, particularly business owners and that. So I just want to talk about that for a second. What stopped you? You touched on it, but what stopped you when you were trained to saying, you know, you’ve been in the bank for a long time, you may have been in a position where you could have said, okay, cool, I’m going to go and live a

[00:22:11] Graham Stephen: simple early retirement life. I mean, my grandfather also worked for Barclays, and he retired at 55 in Plett, you know, and for 20 years, played golf and lived a very simple

[00:22:22] Graham Stephen: retirement. But what stopped you from… that was probably a generation before, but what stopped you from going that way?

[00:22:30] Gavin Ellis: So, so one is… These days, we’re living longer. At 55, you might have to live another 40 years. Your pension at 55 won’t last, okay?

[00:22:39] Graham Stephen: Yep.

[00:22:40] Gavin Ellis: Secondly, I mean, you know me, and a lot of people who know me know that I can’t just sit down. I can’t sit on my backside and do nothing. I’ve got to be out there and doing stuff, you know, and so on.

[00:22:53] Gavin Ellis: Sometimes my wife says to me, just slow down, just like… I mean, I’m 62 now, there’s no slowing down. And we’ll talk about how the business is growing.

[00:23:01] Gavin Ellis: But… You know, it was… It was… I had offers to go back to Stanerbank, you know, I said, no, come back, you know, we’ll gladly take you on. And I thought to myself, you know what, at age 55, I’m young enough, energetic enough, and enthusiastic enough to do this.

[00:23:19] Gavin Ellis: If I go back to center bank, 3 years later, there’s another restructure, now I’m 58, I’ll probably get cold then as well. Then, now I’m… I’m getting more towards now the bitter and twisted, you know, sort of, you know, oh, why are they getting rid of me, and all that nonsense, you know, and so on. Because…

[00:23:36] Gavin Ellis: And I thought, no, I must go and do this thing and see where it takes me. And it’s taken me…

[00:23:43] Gavin Ellis: to great places.

[00:23:45] Graham Stephen: Fantastic, so let’s start a bit about that. So, we’re in, what’s it, April 2019, and you start GCE. I mean, it’s obviously your initials.

[00:23:55] Gavin Ellis: ain’t.

[00:23:55] Graham Stephen: what the middle name is, but we can leave that one out.

[00:23:59] Gavin Ellis: Yo.

[00:24:00] Graham Stephen: But tell us the elevator pitch about GCE. I think you touched on it a little bit earlier, but what do you actually do, and where did the idea come from?

[00:24:08] Gavin Ellis: Okay, so… so first of all, the idea came from, I want to do something that would stretch me intellectually, that… where’s my… where’s my expertise, and so on. I touched on it earlier. Didn’t want to go and flip burgers, I thought, no, that’s not me, you know, and so on. So… so I said, okay, so what…

[00:24:26] Gavin Ellis: what can I start that also doesn’t need a hell of a lot of capital to… to start, and so on. And…

[00:24:33] Gavin Ellis: as I said, I researched this thing, I chatted to a lot of people. Essentially, what we do is an extension of what I did at the bank, we just do it for our own account now. So when we ran acquisition teams.

[00:24:44] Gavin Ellis: We were trying to get clients to come from one bank to the bank that you were at. So what… we do exactly the same. We lead with debt. We’re a banking, funding, and debt advisory firm.

[00:24:54] Gavin Ellis: And essentially, we help companies source funding. I mean, that’s what we do. Across all…

[00:24:59] Graham Stephen: I could just jump in very quickly, you know, in South Africa. that concept was relatively new. If you look in the US, we do a lot of work, you know, they have what they call the SBA, or the, you know.

[00:25:10] Graham Stephen: Business Administration Loan Program, and there’s a ton of these, kind of. let’s call it advisors, helping people get the best chance of actually getting the loan or the funding that they need.

[00:25:22] Gavin Ellis: Yeah?

[00:25:22] Graham Stephen: So did you… when you started this, was it, you know, were you looking at models elsewhere in the world and seeing what was being done, or was it just kind of, you know, you saw a gap in the South African market, thought, okay, let’s create… let’s create something to fill this gap?

[00:25:36] Gavin Ellis: Yeah, I think a combination of all that, you know, I did… I did research, you know, you can do better research now with AI and so on, but then, you know, you Googled and whatever, now you do, you know, when you say, I googled it, now you do… I chat GBT’d it, or whatever, you know, so, and that. But, yeah, I did… I did research, research out of Australia, research in the UK, research in the US, and so on.

[00:25:59] Gavin Ellis: having access into Barclays UK, I… I went across a couple of times to the UK. Their… their brokers are… are…

[00:26:08] Gavin Ellis: not a dime a dozen, but there’s a lot of broking firms that are there. I want to make a distinction that we are not a broking firm. We don’t… we’re an advisory… a debt advisory firm. We structure things properly.

[00:26:20] Gavin Ellis: Brokers will just take your stuff and then send it wherever they can, and hope to goodness that somebody will… will provide.

[00:26:27] Graham Stephen: You’re like an independent advisor, almost, as opposed to a…

[00:26:31] Gavin Ellis: Yep.

[00:26:31] Graham Stephen: Yeah, a broker, yeah.

[00:26:33] Gavin Ellis: Yeah, absolutely. So, so we… So that’s… that’s a… a call. We lead with that. We help clients… I mean, some… I’m part of a networking group, and there’s been some… some chatter on that about they’re not happy with their present banks, and so on, and I’m helping some of them just transition across to… to other banks that… where they feel… they’re already feeling

[00:26:55] Gavin Ellis: even in the onboarding process, they’re feeling much happier, and they’re feeling, you know, loved, if I can put it that way, you know? That type of thing. So, because banks, unfortunately, have got so big, and they’ve got so impersonal, that

[00:27:09] Gavin Ellis: the personal touch for the smaller businesses, and I don’t like to call businesses small business, because if you run a business, your business is big in your mind, you know, so I don’t like that terminology. But, yeah, so we… and the other thing that we help the clients

[00:27:25] Gavin Ellis: source the right funding for their business, and not just the easy funding, because it’s easy to go out there and get these… this easy funding, where you’re going to pay an arm and a leg, and before you know it, you’re in trouble. So…

[00:27:39] Graham Stephen: Some ways you’re almost bringing old school back into banking. I mean, I’ll share a quick story. I remember going with my dad when I was, I think, 17 years old to his bank manager in Kempston Street, or Kempson Road in Port Elizabeth.

[00:27:51] Graham Stephen: And applying for, I think it was a 2,000 rand student loan, you know, to pay for the books in my first year of university. And, you know, the bank manager knew him, he’d had a relationship with him for 5, 10 years, and my dad was, at that stage, sort of a solopreneur, so, you know, he sat down and he said, you know, Roger, and I was there, you know, and banking’s not like that anymore, you know, unless you have a Swiss bank account, maybe.

[00:28:16] Graham Stephen: Maybe it still exists there, but you were bringing that back in, the relational component, actually understanding what, you know, what was right for the business.

[00:28:27] Gavin Ellis: Absolutely. Yeah. And you know, the other thing is, so after 35 years of banking, and doing this for 7 years now, we have relationships in all the banks, and it’s important that most of those relationships are people that either work directly for me.

[00:28:43] Gavin Ellis: or knew me from… from the banking world. So, we know where to go. That’s the big thing. If you don’t know where to go… I mean, the one client that we’re busy transitioning across now, she was trying to go to the bank, and it got hold of the call center. No, no feedback, no nothing. I said, no, but we’ll help you. And we got the bank out within 2 days, they were out there.

[00:29:07] Gavin Ellis: And they’re already, like, getting, banking accounts opened, et cetera, et cetera, you know, and that was from Monday to now, that they’re busy, you know? But you’ve got to know the right people. So again, we spoke about it earlier, it’s about building the right relationships, you know, and…

[00:29:24] Gavin Ellis: A client themselves can’t build multiple relationships across the banking and the alternative funders. We do that.

[00:29:32] Gavin Ellis: So we know where to go, and so on. I mean, if… if they need whatever type of funding they need, we… we’ve got… we’ve got… for a company, we’ve got access into anything that you may need, we could… we can source it for you.

[00:29:48] Graham Stephen: It’s like going to… I’m going to use an analogy, it’s like going to your family doctor, okay? And even that world has changed nowadays. The family doctor knows you, they know your history, they know what you’re doing, and if you need a specialist podiatrist, or a radiographer, or whatever, they’ve got access to all the right ones, okay? Yeah, yeah.

[00:30:05] Graham Stephen: But let’s just talk a couple of things, Gav. You know, so I just want to understand, first and foremost, you’ve touched on it, but who’s your, sort of, primary target market?

[00:30:13] Graham Stephen: With, with GCE. And then also, you know, I want you to just touch on, you know, you’re not the only debt advisor in the country now. I think, you know, when you started, it was quite novel, there weren’t as many people doing what you’re doing, but what makes

[00:30:28] Graham Stephen: you different, specifically. So, talk about your target market, who you’re chatting to, who’s your ideal client, and then what makes you different.

[00:30:36] Gavin Ellis: Okay, so our target market is really the business and commercial banking markets of… of what the banks… how they define it. So, typically, it’s family-owned businesses, that are up to, say, 2 billion rand turnovers. We don’t want to do listed companies, and we don’t want to do that for a reason.

[00:30:54] Gavin Ellis: Because A, you know, we don’t want to go and sit across the table in a board meeting and try and sing for our supper. I always say, you never know who the sheriff is in the room at a listed company, and sometimes the sheriff isn’t in the room.

[00:31:08] Gavin Ellis: But there are people acting like the sheriff, you know, and so on. So we don’t want to do listed companies. If a listed company comes to us and says, listen, Gavin, yes, we want to use you, then we won’t say no, but we’re not going to actively go and look for that, okay? Typically, it’s probably the target market from about 20-25 million turnover.

[00:31:27] Gavin Ellis: all the way up to… up to the $2 billion, but the sweet spot is probably about $500 to $750, is turnover business. So a lot of those businesses, you’d be surprised, are still…

[00:31:39] Gavin Ellis: They started off in a garage or whatever, or a small little industrial, you know, lock-up thing. Now they’ve graded… the bookkeeper that they’ve got is still the same one that was with them there. They don’t understand

[00:31:52] Gavin Ellis: high finance, if I can put it that way, you know, and how to structure stuff. So that’s where we can add a lot of value, because we come almost… we come almost like a corporate banker to the… to a client that can’t afford that.

[00:32:05] Gavin Ellis: They won’t be able to afford that. You won’t get that anyway, because of the way the banks are segmented, and so on. Yeah. So that’s our ideal target market, and… and a client who…

[00:32:15] Gavin Ellis: Understands that they need help. And they… they know that they can’t source what they need themselves. You’ve got… we had one… I had a conversation with a client the other day, and he needs help, but he says, one of the things? Personal sureties are off the table.

[00:32:34] Gavin Ellis: won’t get that. I said, I’m sorry, in this market, you know, you’re the… are you making the decisions? Yes, I am. So you want somebody to back you, but you’re not prepared to back yourself. So, you know, so we understand that. We’ve had those conversations as bankers on the other side of the table. So again.

[00:32:51] Graham Stephen: So you know exactly how the decision-making process and credit and what have you works, and you’.

[00:32:56] Gavin Ellis: ledger.

[00:32:57] Graham Stephen: that to the table, yeah.

[00:32:58] Gavin Ellis: Absolutely.

[00:32:59] Graham Stephen: jump in, and sorry to interrupt you, but, you know, one of the things I just want to touch on, and because it’s a value that, I guess, aligns between our business and your business, and that’s just this notion of independence. So, can you maybe just spend a minute or two just talking about

[00:33:18] Graham Stephen: you know, your view on independence as GCE, and how that actually translates in practice, and why it’s important.

[00:33:26] Gavin Ellis: Yeah. So, one of the initial conversations we have with the clients, we tell them we’re an independent debt advisory firm.

[00:33:34] Gavin Ellis: So, how we get paid is we get paid by the client and not by the banks or the funders, and that’s very important, because we work for you as the client, and not for the bank or the funder. We… we have…

[00:33:45] Graham Stephen: What’s a fundamental difference between you and a broker, often, right? Is the broker takes a commission, so to speak.

[00:33:50] Gavin Ellis: Yeah, so we don’t do that. We often have fights with the banks, we have major fights with them, you know, to say, come on now, you, you know, the way… the way we’ve presented it. So, when we present a proposal to the bank, that’s the thing as well. We write a funding proposal that looks exactly like a bank’s credit application.

[00:34:10] Gavin Ellis: Because we know what… so we take the client’s story, and we convert it to bank speed, because that’s often where the problem happens.

[00:34:17] Gavin Ellis: The client’s trying to tell the banker his story, but the banker doesn’t… hasn’t got the experience levels to understand that. Okay, so… so we convert that. The bankers love us because they hardly have to do any work, and that. So… so we all.

[00:34:31] Graham Stephen: And they don’t have to pay you.

[00:34:34] Gavin Ellis: 100%. Look, and many of the banks, they say to us, but we don’t pay anyway. We are very different to a mortgage originator. You know, you go for a home loan, mortgage originator, the banks will pay them, that’s… in our world, the banks won’t pay. There’s,

[00:34:51] Gavin Ellis: I mean, when guys came to me at… when I was running acquisition, and they wanted… they did say, oh, you know, sorry, we won’t pay you. So we understand that. So that’s why that model is like it is, and so on. And we work on… so our structure works is we work on a work fee.

[00:35:09] Gavin Ellis: For 90 days, a 3-month work fee, and a success fee. And there’s psychology around why there’s a work fee and a success fee. So, you know, about, you know, you value what you pay for,

[00:35:21] Gavin Ellis: we view ourselves as professionals, so we should get paid on a professional rate for that work that we’re doing. You know, if you want us to work on risk, and somebody else comes and says, well, we’ll pay you for your work.

[00:35:34] Gavin Ellis: Well, sorry, the one who’s on risk and so on might get bumped to the… Backwards, you know?

[00:35:40] Graham Stephen: You know, it’s skinning the game, right?

[00:35:42] Gavin Ellis: No, you’re…

[00:35:42] Graham Stephen: client selection process. If somebody realizes we have this need. You know, and we’re paying for professional advice, and you know, you just take the insurance sales, you know, you look in the UK, it’s like all IFAs, they can’t take commissions, as opposed to the South African insurance model, where historically it was

[00:36:01] Graham Stephen: You know, you sell the product with the highest commission. So that independence is critical, but it’s also, as you say, it’s a filter

[00:36:08] Graham Stephen: on the client and their intent. If they’re prepared to put out an amount of money for you to run the process.

[00:36:15] Graham Stephen: Is that they’re serious. They’re not just.

[00:36:16] Gavin Ellis: y’all.

[00:36:17] Graham Stephen: Fishing in the hope that maybe, maybe a whale bites, so to speak.

[00:36:20] Gavin Ellis: That’s a.

[00:36:20] Graham Stephen: or a shock, or whatever it is, yeah.

[00:36:22] Gavin Ellis: And as well, what we do is that, obviously. People come to us because a lot of their relationships with their present bank have… have…

[00:36:32] Gavin Ellis: failed. They feel that they’re not being heard. But, we’ve also gone to the existing bank as well and said, but this is the client… I mean, we moved a client up from where it was segmented to another segment, because now the bank understood what size of the business it was.

[00:36:49] Graham Stephen: They were just in the wrong… they were in the wrong service department, exactly.

[00:36:51] Gavin Ellis: That’s it, yeah, you know, so… so if the clients want us to negotiate on their behalf with the banks, with their existing banks, we will do that as well, because we know how to talk to a banker, you know? I mean, clients sometimes, they try and talk to a banker, they just get pissed off, because the banker’s like.

[00:37:08] Graham Stephen: There’s your second, there’s your second swear word.

[00:37:12] Gavin Ellis: But they, they mauled… They mauled.

[00:37:14] Graham Stephen: So, Gavin, I want to just… we’ve got about another 20 minutes, and I want to talk about two more things. First, I want to talk about the state of funding in South Africa.

[00:37:25] Gavin Ellis: Yeah.

[00:37:26] Graham Stephen: So I want to zoom out, you know, so South African businesses often feel like, you know, funding is hard to get, and, you know, the banks will lend you money when you don’t need it, and when you really need it, they won’t give it to you, so they’re seen as being very risk-averse, as opposed to this kind of…

[00:37:41] Graham Stephen: take a view of banks in the US, for argument’s sake, okay? But I want you to just touch on a couple of things. You know, from where you sit, what’s the actual state of play? And then secondly.

[00:37:52] Graham Stephen: If you can, you know, if there’s a business owner sitting in the car, or listening to the episode, or applying for funding, you know, can you maybe just talk about what are some of the, sort of, most common reasons why

[00:38:02] Graham Stephen: you know, business owners struggle to find debt, I’m sure, or funding, or whatever it is they’re looking for. You know, maybe state of the play on business lending in South Africa, and then what are the big reasons that business owners kind of fall over at the post, so to speak?

[00:38:19] Gavin Ellis: Yeah. So… so obviously you have to… you have to understand how banks make their money, and… and so on. So that… so… so… so we put money into a bank, we invest it, you know, via savings and whatever. The banks take that money and lend it out, okay?

[00:38:35] Gavin Ellis: So, if you’re the lender, or if you’re the saver, you’re quite happy that they’re not taking, like, cowboy risks, okay? But they’ve got to lend it out judiciously, so that they make a fair return, so that they can make money, okay?

[00:38:51] Gavin Ellis: But, having said that. the appetite out there is there. You’ve just got to know where to look. I mean, we’ve taken clients, a 10 million rand overdraft facility.

[00:39:03] Gavin Ellis: Where the present bank was wanting to reduce that facility, we took it to another bank, they looked at it completely different, went from 10 million to 30 million overdraft.

[00:39:12] Gavin Ellis: Okay, so… so it is out there, you’ve just got to know how to look, and you’ve got to know how to put your story in the correct sequence, if I can put it that way, okay? So that’s where we come in. So it’s about telling the right story. Are you… and as well, are you funding ready? So, in the last

[00:39:32] Gavin Ellis: Since the beginning of the year, there’s been a lot of stuff out in social media about fundability, are you funding ready, etc, etc. We’ve actually developed a Fundability Masterclass workshop about how to get your funding ready, because we understand what the banks look for, and so on. So if you go too early to a bank.

[00:39:51] Gavin Ellis: When you’re not ready, the bank’s gonna say no, and then they get a jaundiced view of you. Okay? So,

[00:39:58] Gavin Ellis: That’s the… and there’s a saying in the banking world, your best chance at credit is your first chance. So you must make sure that you’re ready to go there, as well. The other thing that in South Africa, there is not a great startup slash venture capital market in this country.

[00:40:15] Gavin Ellis: You know, in the US, you’ve had experience there, and you’ve seen what that world is like. The US venture capital market will say, I’ll invest in 10 companies, 6 will lose the money, 2 will break even, and 2 will make big money, you know? Then they’re happy.

[00:40:31] Graham Stephen: Probably a hundred companies, and one will make big money, five will break even, and the rest will lose.

[00:40:37] Gavin Ellis: I’m being… I’m being con… confident.

[00:40:40] Graham Stephen: But, but…

[00:40:41] Gavin Ellis: here.

[00:40:41] Graham Stephen: We…

[00:40:42] Gavin Ellis: the venture capital market, and I’m happy to have conversations with venture capitalists if they’re, you know, that are out there, they don’t necessarily want to invest in companies that are pre… pre-revenue, okay, so they’re not making money yet. They will invest in companies that are post-revenue, making money, and they say, we’ll invest in you, and we’ll 10x your business.

[00:41:02] Gavin Ellis: then that’s, you know… so… so that’s… and… and clients don’t understand that. We’re busy with a client right now, he’s got a great idea, but unfortunately, it’s an idea. Banks, venture capitalists, etc. don’t…

[00:41:15] Gavin Ellis: fund ideas. You know, you’ve got to have something concrete. So typically, you must be, you know, running for about a year, have some financials, preferably be making some… even if it’s a small profit, not be, you know, not be insolvent, and all that stuff. But there is stuff out there.

[00:41:34] Gavin Ellis: The banks have a certain market. These alternative lenders are… there’s good alternative lenders out there, which have a place in the market.

[00:41:43] Gavin Ellis: We… we advise our clients Quite heavily about what that looks like, how it looks like, how, you know, what happens in year two.

[00:41:51] Graham Stephen: And often that’s a bridge, right? Because that alternative lending can be expensive, so I think.

[00:41:55] Gavin Ellis: It can…

[00:41:55] Graham Stephen: I see a lot of that customers almost get trapped into that.

[00:41:58] Gavin Ellis: They do?

[00:41:59] Graham Stephen: Not realizing often that alternative funding should be there for a period of 12 or 18 months, just to get you to a point.

[00:42:06] Gavin Ellis: We tell our clients, sometimes the bridge funders, I mean, they’re going to charge you 2-3% a month, so if you can give up 24 to 36% of your profit just on debt and loan repayments.

[00:42:17] Gavin Ellis: We say to our client, if you need a million rand to do something right now that you’ll get payback in two to three months, then that’s fine, and your payback is 1.5 million. So you’re gonna make 500,000,

[00:42:28] Gavin Ellis: 2… 2… to make… it costs you, say, at 2%, it’s gonna cost you a max $60,000, so you’re actually going to make $440,000. If you don’t have that, then, you know, the access…

[00:42:39] Graham Stephen: You learn economics at the end of the day. It’s right back to the basic principles of, are you making enough money from every sale to cover your.

[00:42:47] Gavin Ellis: Absolutely.

[00:42:48] Graham Stephen: the funds.

[00:42:49] Gavin Ellis: Yeah, yeah. And then the next one that you asked is about, okay, for guys out there listening in the car, what are some of the things that…

[00:42:59] Gavin Ellis: Maybe why applications or funding requests fail, those type of things. You wanna… okay, so one is…

[00:43:06] Graham Stephen: Yeah, just dive into just what are the 3 or 4 big things, you know, I think.

[00:43:10] Gavin Ellis: Enjoy yourself.

[00:43:10] Graham Stephen: really useful and practical.

[00:43:12] Gavin Ellis: Yeah, so I’ve touched on it, you’re not funding ready, okay, so you’re too early in the process. Secondly, your financial information is just not where it should be. And, you know, a bank looks at that and says.

[00:43:25] Gavin Ellis: you know, how are you running this business? You’ve got no management accounts, how do you know what’s actually happening? You know, so… so you need to get proper, you know.

[00:43:35] Gavin Ellis: systems in place to make sure that you do that. And in our ecosystem, we have access to outsourced CFOs, etc, etc. So again, we, you know, if it’s too…

[00:43:45] Graham Stephen: Actually, bookkeeping often isn’t in place. You know, people just run off a bank statement, and there’s no, you know, tax returns haven’t been filed, and there’s.

[00:43:52] Gavin Ellis: Absolutely.

[00:43:54] Graham Stephen: Zero, or…

[00:43:56] Gavin Ellis: You know what I’m.

[00:43:56] Graham Stephen: or whatever platform you’re using.

[00:43:59] Gavin Ellis: In fact, we had a client the other day, and he runs off Xero, and he says… I said, have you got management accounts? He says, no. I said, well, just go into Xero and ask… it’s there. You just have to press the right button, and you get it. Oh, he didn’t realize that. You know, so… Yeah. So, so, there…

[00:44:17] Gavin Ellis: Again, you know, structuring your debt facility in the wrong way. So, are you funding a lot of, like, assets with short-term working capital? Because eventually that will crowd out what your overdraft

[00:44:30] Gavin Ellis: is needed for, and, and so on. Yeah, so, so, interestingly, is do you know why you want the money? Okay?

[00:44:40] Graham Stephen: Hmm.

[00:44:40] Gavin Ellis: I can give you stories when we were… when I was right in the beginning of my banking career, guys would come to me and say, you know what, I… on a Monday morning, I had a bribe with a mate of mine who’s got a business the same as mine, he says, same as mine. He’s got a 5 million rand overdraft facility. I only have a million rand, but my business is bigger than his.

[00:44:59] Gavin Ellis: Well, how do you… A, how do you know that? And B, how do you know what… what security that guy has given? He’s probably hocked his house, hawked whatever, you know, meanwhile, you know, so… yeah, so… and then you’d say, why? Well, just because my mate’s got it, I want it, you know? So… so understand your why is very important, around that.

[00:45:18] Gavin Ellis: The other thing is that… We sit with clients, so one of the things that, as I say, when we structure a deal, so we sit and we work out what their working capital cycle is.

[00:45:28] Gavin Ellis: You know, and their cash conversion cycle. We sit there and we say, okay, so tell us, if you’re a manufacturing business, so from day one, when you order the stock, okay, how long does it take to get here?

[00:45:40] Gavin Ellis: When you do… how long does it take to convert that stock that you’ve got into a finished good? How long does it then take to sell? And, you know, and you might have orders for it, okay, but how long does… does your debtor take to pay? Is it 30, 60, 90 days?

[00:45:56] Gavin Ellis: Work out what that looks like, then suddenly your facility is not 5 million, it’s actually 10 million or 15 million, because your order stopped now, you’re not gonna wait

[00:46:05] Gavin Ellis: 120 days until you get the next stock order in, so you order stock now, and then, you know, you might want to order another one in Monday.

[00:46:13] Graham Stephen: I guess, Gavin, I mean, the point around that is banks ultimately are managing risk. So they want to know from the business owner that the business owner understands their business, their business model, and the risks associated with it. Because if they… it’s not just, oh, I need money. You need to be able to

[00:46:28] Graham Stephen: Every point in your story, needs to back that up, and you need to demonstrate to the bank or the alternate lender that you understand how to manage those.

[00:46:39] Gavin Ellis: Absolutely.

[00:46:39] Graham Stephen: And essentially, I guess, what you’re saying is all these preparations are proof points. and demonstrations of you as the business owner understanding what those risks are. It’s like, if you go skydiving, you say, I’m not going to worry about having a secondary parachute, you know, whatever. You know, listen, I’m not going with you as a, you know, as your, let’s call it, twin companions.

[00:47:01] Graham Stephen: You know, at the end of the day, you need to understand those risks.

[00:47:05] Gavin Ellis: No, 100%. And then, you know, also, how is your balance sheet structured? You know, do you have the right structure for the balance sheet? I mean.

[00:47:15] Gavin Ellis: Let’s face it, over the years, the South African business owner sport is how to make sure that I pay as least amount of money to the taxman, okay?

[00:47:25] Graham Stephen: Yeah.

[00:47:26] Gavin Ellis: But what that means is you’re not retaining income in your business, because you’re taking, you know, you’re taking as much as you can out, so now, now you come to me, and you say, okay, I want X. Your balance sheet doesn’t… doesn’t support that.

[00:47:39] Gavin Ellis: Yeah, but, but, but. You say, no, but, you know, you gotta… I mean, you’ll see it when you do your evaluations all the time, okay?

[00:47:48] Graham Stephen: Shareholders’ loans or directors’ loans, you know, they push the tax burden, so it’s a balance sheet structured around minimizing tax, rather than a balance sheet structured around optimizing value.

[00:48:00] Gavin Ellis: Absolutely, no.

[00:48:02] Graham Stephen: 100%. It’s the same when it comes to business valuations. We see that all the time, and it’s a big red flag for the banks, is when they see big loan accounts, no matter… I’m not saying people are tax evading, they’re doing it in a legal way, and they’re paying the right interest and what have you, but it’s a big issue.

[00:48:19] Gavin Ellis: So, one of the things that, when I was… when I was a banker, and I would chat to a client, and he would come in and say, okay, and I’d say, no, you can’t, your balance sheet’s not good enough.

[00:48:27] Gavin Ellis: He says, well, what must I do? I said, you need to retain income. It’s going to take you a year to do that, but it’d come back to the next year, here’s my balance sheet.

[00:48:34] Gavin Ellis: And I’d say, yes, now we can do it, you know? But the problem is that the business owners don’t necessarily take your advice. So we do have… we do… we do have a service where we… we sort of act as the… I spoke about sheriffs earlier. We act as the sheriffs and their accountability managers, so… so again, we’re busy working with a client down in Cape Town.

[00:48:56] Gavin Ellis: Where we are getting them to a fundable perspective. And the problem is they’ve got.

[00:49:01] Graham Stephen: It takes time, right? It doesn’t happen overnight. Sometimes you need 6 or 7 or 12 months to prepare before you… before. You get your chances right, yeah?

[00:49:11] Gavin Ellis: No. And we’ve given them a sort of optimization plan, what to do. And the thing is, you can give the guy as many plans as you want, but then business happens, life happens, and he doesn’t follow through. But if we’re there every second week, saying, okay, has this happened, that happened, and so on, you know, then…

[00:49:28] Gavin Ellis: Then he says, oh, okay, now he needs to answer to that, you know, and he can’t just say, oh, just didn’t want to do it. Well, you know.

[00:49:36] Gavin Ellis: I don’t think we charge for that, so, you know, if you didn’t want to do it, you’re still going to pay me my fee, you know? So, hell.

[00:49:43] Graham Stephen: I think these are super practical advice. I think we’re going to have to have another podcast at some point where we just kind of really drill down into this, even a workshop, perhaps, you know.

[00:49:52] Gavin Ellis: Yeah, yeah.

[00:49:53] Graham Stephen: But we’ve got about 5 minutes left, and I want to just cover two more things. We keep about 2 minutes for what we call our rapid-fire round, but just to close out, you know, you’ve got a wealth of not just business experience, life experience, and I want you to kind of just…

[00:50:10] Graham Stephen: you know, 7 years in, you’re an entrepreneur now. I mean, I think going back to those early days, there were always those… those seedlings of entrepreneurship, right? I mean, yeah, from your university days, and… and hustling, and all those things,

[00:50:25] Graham Stephen: you know, yes, it might have been accidental that you actually became an entrepreneur, but I think, what are the one or two key lessons you’d want to pass on to somebody who’s kind of

[00:50:35] Graham Stephen: Thinking about making a corporate-to-own-business leap. And anybody sitting here today who’s listening in and has just been made redundant, or is fearing being made redundant, what would you say to them right now?

[00:50:49] Gavin Ellis: So, for the guy in corporate, you know… What happens in corporate, whether you… and in banking, you normally get paid on the 20th of the month.

[00:50:59] Gavin Ellis: Whether you do a good job, bad job, or you don’t even pitch up, you might be on holiday, you’re going to get your salary. On the 20th of the month, it’s gonna come through, and the chances are you might get a bonus at the, you know, and so on.

[00:51:11] Gavin Ellis: Now, when you go into your own business, you’ve got to create that salary. It is not there that, you know, it’s not just going to come to you.

[00:51:22] Gavin Ellis: And you’ve got to get out there and hustle. I mean, one of the things that I did, you know, in the olden days, when the Vikings used to go and attack countries, they used to burn their ships.

[00:51:33] Gavin Ellis: Because they said, listen, we’re not going back. So I never took access to any of my pension, because I said, I need to make this work, I need a hustle. You know, if you’ve got a back, you know, something that is backing you up.

[00:51:47] Gavin Ellis: You’re not gonna do it as well as what you should do, you know?

[00:51:49] Graham Stephen: That is not an option, right? Yeah, so you almost refinance and say…

[00:51:53] Gavin Ellis: Yeah. The other thing, so for the guy that’s been… so, as a corporate… I’ve got many friends that have come to me and said, oh, you know, I want to leave, and whatever, and so on. I said, you know what?

[00:52:04] Gavin Ellis: If it is so bad that it is affecting your health, etc, your mental health, your physical health, and so on, yes, then leave. It’s not worth it, okay? But, if it’s still fine.

[00:52:15] Gavin Ellis: And, you know, just stick it out as long as you can in corporate, because remember, as long as you can, then bulge your pension, etc, etc. So, stick it out as long as you can.

[00:52:24] Gavin Ellis: The other thing from a perspective of

[00:52:30] Gavin Ellis: The… no, I’ve lost my train of thought, I wanted to just think about, so that’s the guy that was, okay, saying corporate.

[00:52:41] Gavin Ellis: You know, I’ve lost it. Maybe ask me some of that…

[00:52:45] Graham Stephen: As an entrepreneur, what’s the one piece of advice you’d give to an entrepreneur, you know, I mean, like.

[00:52:52] Gavin Ellis: Okay.

[00:52:52] Graham Stephen: that lead.

[00:52:53] Gavin Ellis: Yeah, so, for an entrepreneur. you’ve continually got to be looking at how you can also reinvent yourself, look for new markets, look for… I mean, you know, so in my world, we… so one of the things is, you know, my network is big, and your network is like your net worth, okay? But you only have…

[00:53:14] Gavin Ellis: you only have a certain amount of people in your network. You’re continually got to be building that, and so on, and talking to people who might have a need for your services, you know, so that’s what I would say to an entrepreneur.

[00:53:27] Gavin Ellis: I mean, it’s easy now to, to… to research it, to say, you know… and I’ve done that a couple of times on my own business. I’ve said, okay, so, I want to do this, I want to do that, how would I do it, etc, etc.

[00:53:41] Gavin Ellis: Look, I employ… I say employ in inverted commas, so we… we don’t have… I don’t have salaried people with me. We have independent contractors, all mainly retired ex-bankers, and so on. So they… they work on a commission basis. So again, it’s about how do I push them

[00:53:59] Gavin Ellis: On the basis that… They… they could not… they don’t have to work, but it’s about, you know, are they… they want to feel part of a community, they have lots to offer, and so on. And I think the guys.

[00:54:11] Graham Stephen: I think Steve Jobs probably sums it up best. I think it was his Stanford commencement address, I think it was back in 2009, if I remember. He said, stay young, stay foolish, or stay curious, stay foolish, you know. And it’s this notion of

[00:54:25] Graham Stephen: Don’t rest on your laurels, you’ve got to keep working at it, the market’s changing, and no matter what your age is on your birth certificate, you know, is…

[00:54:35] Graham Stephen: you’ve got to keep reinventing yourself, listening to clients, evolving, building relationships. I think that is… that’s…

[00:54:41] Gavin Ellis: That’s a…

[00:54:41] Graham Stephen: Most of it, right?

[00:54:42] Gavin Ellis: I mean, I’m 62 now. I have no, you know, plans to slow down. My next age, sort of, target is what’s happening at 65. What does it look like? Probably go to 70, and maybe 75. We’ll just see what happens, you know, so…

[00:55:00] Graham Stephen: As long as you can write off that round of golf as a business expense, you might as well keep going.

[00:55:04] Gavin Ellis: Absolutely, yeah, yeah.

[00:55:08] Graham Stephen: Kevin, how do you…

[00:55:09] Gavin Ellis: And then just a word… just a word to that guy that’s sitting there now, because some of them might be boys sitting there, that they’re getting the 189s, they’re gonna be retrenched and so on. So, you know what? At the time that it happens, you think it’s the worst thing that’s happening to you, but you know what? The sun will come up tomorrow.

[00:55:27] Gavin Ellis: And you’ve just got to have faith in what you… that who you are. The other thing is, remember, if you’re in a large corporate and you get that, corporates like to dumb you down a little bit. You know, they… so, corporates don’t necessarily want a whole lot of A-team players. They want… they want the C’s and D’s that are just there, that will do a good job.

[00:55:47] Gavin Ellis: won’t get big salary increases, etc, etc, and so on. And then, because you’re in… you might be there. You might be thinking, but I’m not as good as what I think I am. Let me tell you, out there, people value what you have, and… and you’ve just gotta… you’ve just gotta, you know, be…

[00:56:05] Gavin Ellis: I’m gonna be faithful about it. You know, my faith is about…

[00:56:09] Graham Stephen: Thank yourself, that’s the one thing, as an entrepreneur. Thank yourself.

[00:56:11] Gavin Ellis: Thank you so much.

[00:56:12] Graham Stephen: Who’s gonna back you, right?

[00:56:13] Gavin Ellis: Oh, that’s it, you know, yeah, so that’s it, you know.

[00:56:16] Graham Stephen: Yeah, we end with a quick, what we call rapid-fire section. Just 5 questions for you, literally 10 seconds, top-of-mind answer. It’s a bit of a fun thing we do just to get to know the man, you know, behind all of the business and everything. So let’s start quickly.

[00:56:32] Gavin Ellis: It might be quite difficult for me, a one-liner, you know, I’m a bit of a talker.

[00:56:38] Graham Stephen: your next meeting’s calling, so…

[00:56:40] Gavin Ellis: Nope.

[00:56:41] Graham Stephen: One business book every business owner should read.

[00:56:45] Gavin Ellis: 7 habits. Steven Cozy.

[00:56:47] Graham Stephen: No, I mean, I’m a big fan of Stephen Covey, so, begin.

[00:56:52] Gavin Ellis: First, first habit, begin with the end in mind. Always, always…

[00:56:55] Graham Stephen: Exactly.

[00:56:56] Gavin Ellis: That’s… that, for me, is like a North Star. Begin with the ending one, you know?

[00:57:00] Graham Stephen: Precisely. And then, number two, what’s the best piece of advice you’ve ever been given?

[00:57:05] Gavin Ellis: Many, many years ago, when I started my banking career, my one mentor then said, listen here, your banking… your career is a marathon, it’s not a sprint, it’s not where you are now, where you start, it’s where you land up that counts.

[00:57:20] Graham Stephen: Fantastic. Third one, what would you tell the 27-year-old Gavin sitting in a standard bank branch? You know, add on another 35 years of experience.

[00:57:32] Gavin Ellis: Don’t… don’t take on all the fights that you… that you have taken on. I… my nickname when I was a youngster in the bank was Bulldog. If I believed in something, I wouldn’t let it go.

[00:57:45] Gavin Ellis: And, you know, sometimes that’s to my detriment. So, it’s not worth fighting all the fights you think that are worth fighting. Just let it go.

[00:57:53] Graham Stephen: Absolutely. I probably shouldn’t ask the next question, it’s going to get you into trouble, but I said, the one bank you’d most like to do business with today, you can’t be honest, or you can be diplomatic, I’ll leave it to you.

[00:58:03] Gavin Ellis: Okay, I… to me, I’m brutally honest… I’m brutally honest with clients, I’m brutally honest in my life.

[00:58:10] Gavin Ellis: So, we do a lot of work with Investig. We like doing work with them, we like the way that they operate. We think there’s some areas that they can do better, and I chat to the guys about that, but generally, we like to do business with Investig.

[00:58:25] Graham Stephen: Fantastic. And then, the last question is, one, if you could change one thing about the South African business funding market tomorrow, maybe wave a magic wand, what would that be?

[00:58:36] Gavin Ellis: Yes, sir, that’s a… that’s a tough one, because obviously, with my banking experience, I understand what some of the constraints are, but I… but I think that

[00:58:47] Gavin Ellis: I always tried to get a fund going in the bank that I worked where you lost money.

[00:58:54] Gavin Ellis: But you learned about the business. And maybe they need to understand, you know, to understand some of the businesses that they want to fund, and industries, they need to be able to lose money on it. You know, so within the bank context.

[00:59:09] Gavin Ellis: Create a little fund, learn… make… make learnings out of it, and so on. See where that goes.

[00:59:16] Gavin Ellis: I could never get that right.

[00:59:17] Graham Stephen: And I guess, yeah, so it’s not VC, but it’s looking at, you know, maybe in the US, there’s some of that SBA, government-backed, startup.

[00:59:25] Gavin Ellis: Yo.

[00:59:25] Graham Stephen: entrepreneurship through acquisition. Yeah, I love that. Gavin, I mean, I think this conversation has been genuinely valuable. I think there’s so much wisdom and just authenticity, and I just love the stories. Anybody listening in today, how can they find you? What’s the best way to get hold of you?

[00:59:44] Gavin Ellis: Okay, so on our website, so we have a website, so it’s, the normal www.gcebiz, B-I-Z, Solutions, with an S at the end.co.za. There’s an email address there called Apply, it comes through to me and another guy, on it, so, Annette.

[01:00:02] Gavin Ellis: You can always send an email directly to me with the heading Banking, and that, my email address is just simple, it’s gavin at then GCEBizSolutions, and that, and then also .co.za, I think.

[01:00:19] Gavin Ellis: I can’t remember me.

[01:00:21] Graham Stephen: LinkedIn, of course.

[01:00:22] Gavin Ellis: LinkedIn?

[01:00:23] Graham Stephen: and Ellis on LinkedIn.

[01:00:24] Gavin Ellis: That’s it! Put me up on LinkedIn, send me a connection, let’s connect, let’s have a conversation.

[01:00:31] Graham Stephen: And which golf course? Which is your home course? Because maybe you bump into someone there.

[01:00:36] Gavin Ellis: I mean, I think, you know, I play out of Jackal Creek, so that’s where I play up here in Joburg. Every Saturday morning there, playing with my mates. Don’t get to play much during the week these days, because, you know, when you run your own business…

[01:00:51] Gavin Ellis: I can’t afford to do that. Yeah, yeah.

[01:00:54] Graham Stephen: Fantastic. Gavin, absolute pleasure, and to our listeners, if you enjoyed this episode, please share it, like it.

[01:01:02] Graham Stephen: If you’ve never… if you need funding, reach out to Gavin. If you haven’t ever had a proper valuation done, reach out to us at bizvalglobal.com, and until next time, keep building real value, and join us for our next podcast soon.

[01:01:17] Gavin Ellis: Cool. Thanks, Graham. Thanks. Thank you.

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