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Growing from a garage startup

Dial-A-Nerd celebrates its 20th birthday next year, but it hasn’t all been plain sailing.

Colin Thornton, Dial-A-Nerd

When Colin Thornton started Dial-A-Nerd in 1998, he had just dropped out of university and says ‘real life’ was knocking on the door.

Thornton explains the initial business concept easily fell into place: “I was a nerd and had always been the ‘go to’ guy for friends and family. I was the person you called when your computer wouldn’t start or your modem (it was a long time ago) made funny noises. The company name came from my girlfriend at the time who now, appropriately enough, is in marketing.”

Today, he’s co-MD, a role shared jointly with his brother Aaron, and the company Colin started has its main office in Johannesburg and another branch in Cape Town. Thornton counts the company’s longevity as a success; it will mark 20 years in operation in August next year. But, as with most business histories it hasn’t all been plain sailing, with a downturn in the home user market causing company contractions, as well as a failed partnership a decade ago.

“We’ve had long periods of losing money and periods of making money, sometimes we’re growing and other times we’ve had to shrink. So it hasn’t all been positive but we’ve made it through and seem to be the better for it.”

Peaks and troughs

A familiar tech story, Dial-A-Nerd literally started in a garage, but experienced impressive initial growth. At its peak – around 2009 – it had close to 150 staff with 16 branches around the country. Today, however, it has 75 staff and two branches because, as Thornton says, its business-to-consumer market started to disappear.

“People weren’t replacing their desktop PCs at home when they broke, they were getting tablets which couldn’t be serviced, operating systems became much more stable and viruses weren’t so prevalent as anti-virus programs improved. People had also become much more confident with IT and would often fix things themselves, and if they couldn’t our typical customer probably had children who could!”

However, Dial-A-Nerd is now seeing good growth in home IT support thanks largely to the advent of fibre-to-the-home.

“People suddenly have lightning-fast internet and want their Hi-Fi system connected to the internet so they can stream music, or need us to extend WiFi to reach every corner of the house, or install IP security cameras.”

Servicing businesses

Dial-A-Nerd isn’t simply focused on the home market however. It also services small to medium businesses, with up to 300 users. And like its business-to-consumer unit, its business-to-business unit is also being put on a growth path, with a focus on remote support services. Thornton says the aim is to almost double turnover for both units in the next two to three years.

Thornton notes the trend sparking most interest with business customers is cloud computing. “We have lots of customers moving away from servers in their office to renting virtual space in the cloud. There are also tons of new software apps, hardware devices, connectivity and telephony options for businesses.”

Humble beginnings

Although the future looks more positive, the company’s history hasn’t always been easy reading. Thornton says Dial-A-Nerd actually started in early 1998, but didn’t get its first cheque until August 22 of that year – which it now counts as its official first day.

He had just dropped out of university, and real life meant bills needed paying. “I had to change from a casual ‘pocket money’ type of service into a real business.”

Having been hooked on an early PC when he was eight-years-old, Thornton’s interest had always been in PCs. However, getting started in business wasn’t so easy because his bid to get a bank loan or overdraft didn’t work, thanks to a lack of credit history. So he “begged and borrowed” R5 000 from friends and family and spent it all on printing flyers which he handed out wherever allowed, and even where it wasn’t.

“I literally walked down busy streets nearby – Rosebank, Parkhurst, Greenside and surrounds – and put fliers under people’s windscreen wipers. I did the same at shopping centres and more than once had security guards escorting me off the premises. On those first flyers, I listed my cellphone number and remember being so excited when my first customer called.

“My parents had a house in Greenside and I used the garage initially. When I realised I needed an office to be taken seriously I rented one in downtown Greenside, probably late 1999. I didn’t need the space at the time but I’d had a few potential staff members turn down employment offers because they didn’t think it was a real business. With an office, that changed.”

Through the years, Thornton says, the company and its culture has evolved somewhat from the group of nerds who played computer games in between jobs.

“We’ve grown larger and with that come rules and policies – for instance you can only play computer games after hours. Having said that, we’ve maintained a relaxed and fun environment whenever possible.”

Despite that, Thornton vows the company will never become a typical corporate business.

Tips from the top

First fire bullets, then cannonballs

This is a metaphor, from Great by Choice by Jim Collins, for how entrepreneurs choose their focus, such as a market segment, product or service, and what they do once they’ve got it. “The concept is bullets are cheap so shoot a few in different directions and see what you hit,” says Thornton. “Once you’ve confirmed you’re on target don’t be tentative and shoot more bullets, get out the expensive cannonballs and go for it.”

Understand cash flow

“I still see small businesses spending or growing faster than their cash can keep up with. I had a very limited understanding of accounting when I started but I always tried to have three months’ worth of running costs in my bank account, just in case.”

Hire people who are better than you

With the skills shortage in the local ICT space, finding good people can be a challenge, however, Thornton concedes a bigger challenge is trying to work out how to keep them once you’ve got them.

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