On the couch with Motswagae

CEO and founder of Ticano Group Opelo Calvin Motswagae fields questions from Patriot Business about his fast growing company

Who is TICANO (any significance for this name), what do you do?

MOTSWAGAE: TICANO Group (Ticano) is an enterprise development financial services firm, registered in Botswana, which is regulated by Non- Bank Financial Institutions Regulatory Authority (NBFIRA). Our services are highly recognised and we have been awarded Economic Diversification Drive endorsement by Ministry of Investment, Trade and Industry. TICANO is a rapidly growing, well managed non-bank business lender. TICANO is a twist of Tekano – meaning we go all out to ensure every need is met for every SME. We work hard to ensure financial support for the SMEs to help them deliver on time every time. Our business approach is to focus on SMEs’ cash flow, so that they can focus on their core business. Our main products are Purchase Order Financing and Invoice Discounting to the SME market. Our midterm plan is to incorporate asset backed funding to our solutions for SMEs in growth phase with long dated funding need.

How many employees do you have?

MOTSWAGAE: TICANO has 11 fulltime employees and 20 sales agents country wide. It has been operating profitably since January 2016.  Our services provide much needed structured finance support to various economic growth oriented industries viz, agribusiness supply chain, healthcare, power and infrastructure and education. The nature of our financing model is very short-term with most repayments being fully paid within 30 days and maximum tenor of our facilities being 180 days.

What is Purchase Order Financing and why have you adopted this business model?   

MOTSWAGAE: Purchase Order financing is a financing model that is specific to funding contents of what is needed by the buyers (government, parastatals, councils and big corporates). We do not look at the financials of the SMEs and history of the supply. We assess each deal on its own merit. We fund transaction with 48 hours. Therefore even the companies that do not have experience and financial muscle qualify. We wanted to open access to finance to all from youth to the old across Botswana. On the other hand, we ensure that buyers do not wait long before they can get their goods. We make the supply chain efficient.

What motivated TICANO to go into Purchase Order Financing?

MOTSWAGAE: I founded Ticano because I am highly experienced in financial services and understand the need for speedy delivery in economic sectors such: power and infrastructure, oil and gas, healthcare, mining and construction, transport and logistics, overseas trade and agribusiness supply chain. This experience enables the team to be far more helpful and creative when it comes to tailoring solutions which benefit our clients’ businesses.

How does it work? Who use your services – target market?

MOTSWAGAE: We are partners to the SMEs. We give hope to everyone across the country that previously did not have credit or a muscle to access funding. And we partner with buyers as well to ensure that they have enough supply such as ensuring that ministries such as health have enough medical supplies and books for the students at ministry of education. We champion the efforts of the government to diversify the economy and support the youth.

What’s TICANO’s key emphasis in conducting business?

First and foremost we want a client centric model to ensure that we are key drivers in meeting their financial needs.  We improved on conventional working capital funding and we do not use property as security. We want to ease the frustration the SMEs in Botswana have when dealing with other financiers, time and assessment criteria.

How different is Purchase Order Financing from traditional micro-lending?

MOTSWAGAE: Ticano is a trade oriented financier. Ticano finances SMEs that already have contracts to execute. We only do developmental funding. We cannot fund a client that will take money and use it on leisure or travel. We want to make SMEs grow by delivering the contracts speedily. We do not fund individuals. We fund businesses only. We are regulated under Lending and lease finance not micro finance. Additionally, we provide financial literacy to SMEs to guide them on how to invest their profits.

What is TICANO doing to ensure that SMMEs avoid the dangers of over-borrowing and later struggling with repayments? 

MOTSWAGAE: Ticano only funds clients with contracts that will help clients make profit from the contracts. Speedy deliveries boost the SMEs’ reputation with buyers and enable them to have more contracts. We want SMEs to grow and do more.  We normally ask for credit check like ITC not to deter clients from borrowing but to assist them in clearing the debts after executing the works. This enables them to be credit worthy.

What goes into the assessment of potential borrowers to protect TICANO against over-exposure?

MOTSWAGAE: We work with government parastatals, councils and big corporates to sign an agreement that facilitates our risk mitigation. We have assisted more 2300 since 2017 and aim to finance 1500 clients per annum.

What are the main challenges TICANO has encountered?

MOTSWAGAE: There is a lot of fraud and dishonesty in the SME market and we push harder to ensure we do not get defrauded. Parastatals and big corporates that do not want to sign our agreement to allow us to help their suppliers. Our agreements are internally recognised and very simple to understand. They have to understand that we are here to be their partners and we are only trying to make their supply chain more efficient. They have to understand that for economic activation SMEs need to be supported financially and Ticano is an enabler.

Are you only based in Gaborone?

MOTSWAGAE: We are based at 5^th Floor Zambezi Towers CBD but we have country side sales agents and we have embraced technology as we have an electronic system to do remote orders. We have clients as far as Gumare, Shakawe, Satau, and Ncojane that we assisted without having come to our offices in Gaborone.

PERSONAL PROFILE

FULL NAME:   Opelo Motswagae

EDUCATION:  BEng (Hons) Civil Engineering with focus in Mining Projects, First Class

                      Msc Strategic Management

PREVIOUS EMPLOYERS: Stanbic Bank, Standard Chartered Bank and First National Bank, Geoflux

MARITAL STATUS:  Not Married

HOBBIES:  Off-road terrains, Motorbike riding, Financials News, Soulful Music

READING:   A game as old as Empire: The Secret World of Economic Hit Menand Web of Global Corruption. By John Perkins