SYNAQ celebrates five good years - looks forward to many more
SYNAQ, the Johannesburg-based Linux and open source managed services and software services company, has made a significant impact on the local IT scene since its establishment five years ago, by two (very) young entrepreneurs, Yossi Hasson and David Jacobson.
With the failure rate of start-up businesses in South Africa exceptionally high - the Department of Trade and Industry says statistics indicate that between 70% and 90% of all new businesses will not be around after three years - SYNAQ's five-year milestone is quite an achievement.
And when one considers that American research shows that the survival rate of IT start-ups is generally far lower than their counterparts in other industry sectors*, SYNAQ's achievement is even more remarkable.
So, we asked SYNAQ's founders 10 questions:
1. What motivated you to start SYNAQ?
We have both always been fascinated with computers and technology. We were friends at school and even started a couple of businesses together back then, but we lost touch over the years. Then we met up again. David had been working for a number of IT companies, including one in the UK; while Yossi had dreams of being an entrepreneur. Then we met up again and chatting over a cup of coffee - and the conversation turned to open source and Linux. We discovered we were both passionate about it, and that we believed that it would never gain the respect - and market share - it deserved in the business sector without professional, reliable services and support.
That's when we decided there was a definite gap in the market for a professional, reliable Linux company - and we should be the ones to fill that gap. Our next step was to obtain financial backing - which we did; choose a name for our new company; and launch our new business. Five years later, here we are.
2. What type of business did you set about creating?
Our first business plan stated that we were going to be a professional services company for businesses looking for Linux-based solutions. We were going to offer world-class services and support. We were not going to be just another IT company. We wanted to be brilliant at delivering service.
3. Is SYNAQ today what you envisaged it would be five years ago?
It took us a few years to recognise that being "a Linux company" was far too broad a focus for a small business. We couldn't be all-things-Linux to all businesses using Linux - not if we were to achieve our stated objective of providing world-class, consistent service. So we've refocused our business. We've distilled the best from what we've learned over the years in terms of our strengths and our customers' requirements - which has led to us producing our own product sets. So we're moving ahead as a very different business in many respects from what we were five years ago.
However, there is one very important element that has not, and will never, change. In addition to providing our customers with innovative products, we will continue to provide them with world-class services and support.
4. A high percentage of start-ups fail. Why do you think SYNAQ has succeeded when so many others haven't?
We've succeeded because of our focus on customers and delivering services and solutions that exceed their expectations. Our customer base has grown largely through word of mouth recommendations from satisfied customers.
What has also played a role in our success is that unlike many other start-ups, which are founded by like-minded people, we are so different. David is technically minded; Yossi's passion is business. We complement each other.
We were also extremely fortunate in obtaining backing from shareholders who believed in what we were doing and who have supported us every step of the way.
Then we quickly learned that it is more important to hire people who are as passionate about our business as we are and who fit our culture, rather than to appoint people who come with the right set of skills but the wrong (for us) attitude. Skills can be learned; but you cannot teach anyone to care and believe in the things you do. The result is that we have been able to build up a really strong, SYNAQ-driven team.
Finally, all this would count for nothing if we were not giving our customers what they need and want - products and services that really do add value to their businesses.
5. If you could, is there anything you would have done differently in building your business?
In hindsight, we should probably have become more focused sooner than we did.
However, had we done that, we would probably not have gained the broad experience on which we have been able to develop our innovative product sets. We also would not have attracted and built relationships with the same spread of customers.
So looking back, there probably isn't much we should have done differently.
6. What has been your greatest challenge in the past five years?
People - finding the right calibre of people with the right culture fit. When you are a tiny business, the impact of one 'wrong' appointment can be enormous. As you grow and become more structured, there's a stronger sense of the company's DNA and it's easier to know what the culture fit is - although it remains as challenging as ever to find people with SYNAQ potential.
7. Describe an event/moment when you thought to yourself" a) "We're not going to make it" and b) "Everything is going to be OK".
We were young and probably a little na"ive when we started out. There was never any doubt in our minds that we were going to make it. Of course there were times when we panicked - but fortunately, we never both did so at the same time. This probably helped to prevent a case of jitters escalating into a fully-fledged catastrophe. The fact that our shareholders have always been available with support and advice also helped immensely. However, we have also never been complacent.
8. Now that you can no longer be considered a start-up, does it get any easier?
No. As we've grown, so our responsibilities have increased. It used to be just us and a couple of people who were at risk from our decisions. Now there's so many more, so the pressure to succeed and grow is far greater, and the potential consequences of the decisions we take are therefore larger than before.
Certainly, some of the challenges we faced in the early days are now far easier to handle, largely because we have processes in place and far more structure. However, new and different challenges keep emerging - which is good because through challenges, comes growth.
9. What do you see as your greatest challenge going forward?
Remaining innovative and avoiding the trap of becoming mired in bureaucracy while still being able to deliver our services consistently and reliably. At the same time, we have to ensure that we don't get carried away with innovation and differentiate between hype and real trends in our industry. We have to achieve growth, but it has to be sustainable growth.
10. Look into your crystal ball and describe SYNAQ in 2014.
We see a very similar, entrepreneurial company, with a few more employees, a larger client base and a host of innovative products that are making a real difference to our customers and the international Linux/open source community.
Note to editor
* Scott Shane, Professor of Entrepreneurial Studies at Case Western Reserve University and author of "Illusions of Entrepreneurship: The Costly Myths that Entrepreneurs, Investors, and Policy Makers Live By".