2022 Half-Year Opportunity Report

If you are reading this in June 2022 there are very few businesses that you can start now with little or even some capital that will return enough money to make it viable – moreso if you live in a city with a high cost of living.

South Africa’s structural challenges, an economy remnant of a colonial era that favoured big business and was never meant to lift the masses out of poverty coupled with a left-leaning political party in “power”. Has left South Africa with a weird pro big business capitalistic and socialistic structure that gives the masses just enough welfare in the form of SASSA grants to not revolt.

The two main ways to get out of poverty is:
1. Study and get a good job from a multinational
2. Get a job in government

Self-employment
Business wise (self-employment, startup) there are only a handful of businesses that we looked at in the past that will work in the current environment. I would say 2% of ideas we looked at will currently work in the current environment (both political and economical), we have a high cost of living, and unavoidable costs that have rendered a lot of businesses redundant in South Africa.

There are no easy choices, if you have no money you are going to have to dig deep learn a high value skill, hopefully something that you can run from anywhere. “Learn to code” has become a cliche but I think it might be one of the best ways to get yourself out of poverty with little resources. If you can get yourself to do it, then you can become successful.

If you have *some* money and can purchase a property, then a cheap month-to-month accommodation business is the way to go. Get a modest property in a affordable lower-middle income area and divide it into as many en-suite rooms as possible. If there is space in the yard build tiny en-suite units, turn the garage into a room as well and offer undercover parking. It will depend on area, but you need to get close to city where people work, for example in Cape Town northern suburbs close to N1, my friend has a place he paid R1.2m for not too long ago for. I think there is 6-7 rooms in total, each room has on average 2 people and its rented for around R4000 per room. So around R2000 per person per month. So its a good return even if you have a bond and can then buy another property soon.

The above situation does support the notion that people are even renting out parts of their houses on Airbnb to supplement their income.

Now I am not saying “buy to rent” as I do agree with the general sentiment that “buy to rent” is problematic especially in Cape Town where rates are just crazy. That is one house when renting to one person or family. I am saying roomshare once the domain of students and illegal foreigners has gone mainstream. More and more employed people are going for it and I don’t just talk about those who live out of town and are here temporary, permanently employed people will be using it due to high cost of living.

We are also seeing more and more employed people turn to side businesses to supplement their income. Make sure to check out our side business ideas that was recently moved over from our side business site.

To summarise
Get a good job or government job
Learn a high value skills or become a slum lord

Peace