SA ticketing start-up heads towards R1bn in sales
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JOHANNESBURG - An online ticketing start-up in South Africa has turned into a mega business that is close to achieving R1 billion in sales.
Quicket was started by three idealists, James Hedley, Michael Kennedy and James Tagg in Cape Town in 2011 to create a pan-African business.
Tagg, 35, says they wanted to create an ideal platform to connect people with payments. They realised events did this.
“The platform unlocked a new event market that didn’t exist before,” Tagg says. “Anyone with an idea didn’t have a way to monetise their event easily. It was a lot of admin and difficult to collect money. So, what we have found is that thousands of events using the platform run workshops and seminars that allow them to trade as micro businesses.”
Quicket’s online ticketing rivals include Webtickets, iTickets and Howler.
Tagg says the South African market is segmented and online ticketing companies have their own niches.
He says Quicket has also identified its own audience that has seen its growth trajectory averaging roughly 70 percent year-on-year.
Tagg says Quicket sold R4 million worth of tickets in its first year. This year they are hoping to facilitate between R250m to R300m in sales.
The company charges 2.4 percent, excluding VAT, for ticketing, which covers the ticketing component of their fees. The fee increases to 4.9 percent if using Quicket’s payment processing facilities.
He says Quicket has done more than 50 000 events on the platform.
Tagg says that Quicket allows people to scan their tickets using a barcode scanner, a laptop or a QuicketGO app that is freely available on the Apple Store or Google Play.
Tagg says the journey has been carved through trial and error, particularly on field or gate services.
“It was a trial by fire,” he says. “Running a gate is not what you expect when you start a tech company.”
Quicket has a field services department that assists people with bigger events. People pay for field services, equipment or wristbands for their events.
Tagg says the field service provides auxiliary revenue to ticket sales and the department only became profitable two years ago after they brought in an experienced event planner who turned it around.
To serve this side of the business, Quicket has built up a national database of 800 temporary staff all over the country to call on, depending where the event is held.
He says the company would like to expand further into Africa, but its biggest technical challenge to growth is adding more countries to its platform and resolving different payment method challenges.
Tagg says in Kenya for example, M-Pesa is one of the payment methods.
“Your local audience is transacting in its local currency and being paid out too in your local currency to your local bank account. That is a huge technical challenge for us,” Tagg says.
Quicket sells tickets in South Africa, Kenya, Uganda, Rwanda, Tanzania and Zambia among others.
Tagg says that Quicket does detailed market research on the countries it decides to enter.
In 2017 it entered an equity deal with growth equity investment firm, Knife Capital.
Quicket has now set its sights on expanding into Ghana, Nigeria, Senegal, Ethiopia and Egypt.
“Quicket wants to switch on two countries a year,” Tagg says, adding that technical talent remains a huge challenge. “Finding engineers is tough”.
Tagg says access to funding is another challenge.
“Business networks for small businesses and boosting the knowledge network is also difficult, although this has improved through accelerators and incubators,” Tagg says.
“Regulation around intellectual property is also a challenge for investors looking to invest outside of South Africa.”
Tagg says his biggest wish is for Finance Minister Tito Mboweni to reduce banking bureaucracy and the cost of doing business at banks for small businesses. He would also like Mboweni to take a very close look at the controls of intellectual property. “It is a huge concern for us,” Tagg says.
IP regulations remain an obstacle for local businesses looking to expand internationally, he said.