Why OfferZen Chose Cape Town Over Silicon Valley OfferZen was conceived in Silicon Valley but launched in Cape Town. The company founders discuss the advantages (and disadvantages) of starting a tech business in South Africa.

Vital Stats

• Players: Philip and Malan Joubert
• Company: OfferZen
• Established: 2015
• Visit: www.offerzen.com
• About: OfferZen is a curated online marketplace for software development talent. It has over 500 companies since it launched, including big industry names like Barclays, GetSmarter, Takealot, FNB, Superbalist, Allan Gray, and 24.com. Founders Malan and Philip Joubert have been included in Quartz Africa's annual Africa Innovators list for 2017. The list features 30 of Africa's leaders in technology, business, arts, science, agriculture, design and media.

As soon as they graduated from university, brothers Philip and Malan Joubert entered the start-up scene. Their first business, FireID, met a rather swift and ignominious end, but they kept the name and launched an incubator under the same moniker in Stellenbosch. This endeavour was far more successful, helping to launch local start-ups like SnapScan and JourneyApps.

Soon, a few of the businesses in their incubator were scaling and in need of funding, so the Jouberts relocated (with the start-ups) to Silicon Valley. While living in the world's most famous tech hub, the idea for OfferZen was born.

How did you get the idea for OfferZen?

We enjoyed running the incubator, but we also knew that we loved start-up life and wanted to launch our own business. We identified education and recruitment as two areas where a tech start-up could be particularly successful and have a real impact. We settled on developer recruitment because of how skewed that marketplace is.

Companies are so desperate for good developers, that they get spammed constantly on sites like LinkedIn. We decided to create a site where developers could upload their details and companies would approach them — the opposite of your typical job or recruitment site.

Why launch in South Africa instead of Silicon Valley?

We knew the South African recruitment market well, so we felt more confident launching locally. Also, South Africa is home to some great developers, as well as many large companies in need of their services, so we knew that a market existed for what we were doing.

Another big reason was the fact that we could bootstrap this business in South Africa, while we would have needed to raise funds if we wanted to operate in Silicon Valley. Living and operating there is extremely expensive, so you need a lot of runway. There's also a lot more competition, so you need big names and big money behind you.

Is visiting a place like Silicon Valley worthwhile if you want to launch a tech business in South Africa?

It is definitely worth it. There is an unbelievable concentration of talent and expertise in Silicon Valley, and people are very willing to speak to you. While we were there and preparing to launch OfferZen, we spoke to countless similar recruitment businesses.

Figuring out what could be handled via software/computers versus what we would need people for was one of our major questions, and it was great to discuss this with experts on the ground. So, yes visiting Silicon Valley can be very useful, but you should be working on a specific project. People there don't mind engaging with you, but they want to address specific issues and challenges. They don't want to chat in general. If you're not actually busy working on a business, you won't find it as useful.

How did you manage to attract enough developers and companies to create a viable marketplace?

It really is a chicken/egg situation. You need a bunch of companies on the site to attract developers, and you need developers to attract companies, so how do you build up your database to a point where the whole thing becomes viable? That was one of the biggest challenges we had.

Our advantage, though, was that good developers are so sought after. Companies are desperate to find developers, so they were quite keen to support what OfferZen was doing and join the marketplace. We started by building up a solid database of companies, and then started signing up developers. Once we had the companies, it was easier to convince the developers.

We also offer developers who find employment through OfferZen a R5 000 bonus. Importantly, we started off quite small. Initially we just focused on Cape Town and created a viable marketplace there. Once that was up and running, we expanded to Johannesburg. If we threw the net too wide, we ran the risk of not having enough developers and companies in one place.

You have a very impressive developer-centric blog on your site. Why the focus on the blog?

We realise that only a small portion of developers are actively searching for a job at any given time, so we wanted to create something that would allow us to engage and offer something useful to the rest. Ultimately, we want all developers to be aware of OfferZen and its website, and a great way to do this is to generate useful content that drives traffic to the site. But we don't think this would work if the whole exercise was just a thinly-veiled marketing exercise.

So, we decided to create genuinely useful content that would interest local tech entrepreneurs and developers. Creating this kind of content takes time and money, but we believe it's worth it.

You've grown massively over the last twelve months, from five people to more than 20. How do you make good hires when having to fill roles that quickly?

We've posted an article on our blog where we go into the minute details of our hiring process, which people can read, but I would add that people should seek out the book Who: Solve Your #1 Problem by Geoff Smart.

It's a fantastic book on the hiring process. Another thing worth mentioning, which OfferZen does, is to have what we call "simulation days', where a candidate comes in and does actual work for a few days. It requires time and energy from the rest of the team, and it is also risky, since the candidate is doing real work and interacting with real clients, but we find that it's an excellent way to gauge capability and culture fit.