Latest / The Swan Effect - Creating and Sustaining Your Financial Wellbeing / S3 E4: Ubuntu In Investments

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S3 E4: Ubuntu In Investments · The Swan Effect - Creating and Sustaining Your Financial Wellbeing

• 0:00
  Arthi Rabikrisson: Your legacy is about more than just investment returns. It's about the peace of mind that comes with knowing your investments are in the right hands, and that you've partnered with an investment manager who has the right skills and experience to grow your wealth. Old mutual wealth is a world class investment destination, offering you a wide range of investment strategies and specialist wealth management solutions. Whether your goal is to grow your wealth, generate income or preserve capital, old mutual wealth selects the best and most suitable investments based on your investment strategy, and their extensive research and insights. Together with your financial planner, old mutual wealth team of experienced specialists go to great lengths to understand what really drives you. Once they know your priorities they model a strategy around your specific needs supported by a multi skilled team dedicated to taking your wealth further, whether your goal is to grow your wealth, generate income or preserve and pass on capital, old mutual wealth is here to partner with you on this journey, so that you can do more, have more, leave more and be more. Old mutual wealth is an advice led wealth management business aimed at providing financial planners and their clients with a full suite of industry leading strategies and services. For more information, please visit their website at www.oldmutual.co.za/wealth Hi, there, I'm Arthi Rabikrisson
• 1:52
  Malika Petersen: Hello, I'm Malika Peterson.
• 1:55
  Arthi Rabikrisson: Welcome to
• 1:56
  Malika Petersen: The Swan effect podcast.
• 1:58
  Arthi Rabikrisson: Money makes the world go round yet it's not so easy to understand its complexities, particularly when it comes to investing.
• 2:07
  Malika Petersen: That's why Arthi and I are using this platform to educate, inspire and help you gain confidence in your relationship with money
• 2:16
  Arthi Rabikrisson: So that you can better manage your finances and investments.
• 2:21
  Malika Petersen: We are two women in finance.
• 2:23
  Arthi Rabikrisson: That's pretty cool, isn't it?
• 2:25
  Malika Petersen: It certainly is. You've been in stock broking private wealth management, asset management and now an award winning business woman who is coaching and assisting businesses with capital and strategic advice and Malika you have a wealth of experience in wealth, excuse the pun, in financial planning, investments and relationship management. So you're also at the coalface when it comes to where and how people are investing, both getting it right and getting it wrong and stuck in the grey areas too.
• 2:56
  Malika Petersen: Indeed, I've seen the many phases and moods of financial cycle and how our decisions at those times impact us. So listeners and subscribers. If you are looking to get unstuck, feel empowered and make some strides in how you tackle your money. We are here to help you.
• 3:19
  Arthi Rabikrisson: And it all starts with listening to this upcoming episode. Enjoy.
• 3:26
  Arthi Rabikrisson: Hi, Hi, Malika. Hi everyone.
• 3:26
  Arthi Rabikrisson: Today we want to deep dive into something which in the world refers to as financial power through collective effort. Now, in most of the world, this is actually referred to as crowdfunding. But here in South Africa, everyone, we have a term that encompasses this concept, and the meaning is just so much more than crowdfunding. So the term that we use everyone is Unbuntu. Ubuntu is an ancient African word meaning humanity to others. It's often described as reminding us that I am what I am because of who we all are.
• 4:08
  Arthi Rabikrisson: Right? And I think people do know that. Now also, many people may be asking what's possible that Ubuntu is considered an investment vehicle or a tool to explain it, you know, to actually move ahead with this.
• 4:19
  Arthi Rabikrisson: And you know, to explain, I think we must go back to the original purpose of our podcast, we originally set out to improve the financial situations of you, our listeners, through education and also learning but from each other. And our very first example of crowdfunding or Ubuntu as an investment is the good old stokvel. For those of you who are not local South Africans, stokvel is an Afrikaans word, again, talking about collective pooling and savings. And this is actually where people would come together monthly, pull all the money that's invested, save towards a common goal. Okay. Hey, now this goal may be on a lovely trip together, maybe you're saving towards buying groceries during the festive season, things get expensive. But you know, essentially, the purpose of the savings group everyone is to gain the benefits that come with collective investments and savings. So these benefits include cost savings, because I mean, think of it, it's the buying power of bulk in bulk as well, group also comes together with the benefit of keeping each other accountable. So each member in this collective acts as that accountability partner to one another, that ensures that everyone in the group sticks to the saving plan, and the achievement of the savings goal, I would say the last benefit to which we should not undervalue in any way Malika is the benefit of fellowship, that association with the joy that a fellowship brings the achievement of reaching that effective, that collective sorry, goal, and also that savings aspect that leads to this tendency to want to continue to save and save and save and save, and when we cannot under it, that, so Malika, what are some of the other examples of crowdfunding or Unbuntu investment that you can share with our listeners?
• 6:15
  Malika Petersen: So this example, it is very close to my heart, right? country like South Africa, we, we've had a difficult legacy, many South Africans are first generation professionals, but we've only had opportunities to study cetera, et cetera. And we kind of the first in our family is to be able to become professionals.
• 6:36
  Malika Petersen: Now, this brings with it a responsibility that we kind of feel towards our extended family, right. And while this responsibility is amazing, and we are very blessed to be in the position to help others, it does make it more difficult for us to achieve the levels of wealth that we actually aspire to grow to. So this amazing strategy that I believe can ensure the financial freedom or future generation, and I want to talk a little bit about, so let's assume every member of a family starts contributing towards a family investment that will provide for the education needs of all the children in their family, or the offspring in that family, either the education or entrepreneural needs, right. So what this does is, number one, it ensures that all the children in your family get educated, that's the first benefit, and in turn, once they start contributing economically, or becoming economically active they and start contributing towards the fund, that will go on to create education, financial assistance to the rest of the kids coming from. So what this does is, it's really a beautiful kind of crowdfunding, because it ensures the financial legacy of the members of this family is passed down from generation to generation. And in turn, this creates intergenerational wealth, which is really the goal that I mean, that's like the ultimate goal.
• 8:16
  Malika Petersen: So even the opportunities of the older generation, even though the opportunities of the older generation were limited, what we're doing is by crowding all of this investment pool, ensuring that future generations create generational wealth. It also ensures another thing, the younger members of the family are getting the wisdom and financial education in this process, because the members of this family would need to discuss and agree on the funding, right? I mean, you can't just go to the fund and say I want our R100,000or whatever it may be. They are going to have to have a discussion and agreement, understanding the impacts on the rest of the family. So the younger member who really wants to access to this funding is going to need to pitch their proposal, right. And this gives them skills of articulating a proposal and will be presented at the scrutiny, which really does kind of prepare them for for the rest of the world.
• 9:15
  Malika Petersen: There's also the sense of responsibility that comes with being granted the funding from this pool because the reality of the situation is that your family members are now dependent on you achieving success in order to continue this legacy.
• 9:29
  Malika Petersen: So there's a sense of responsibility I need to do well in my studies or I need to do well in this business venture that I'm starting so that you're able to continue the legacy business really, really beautiful old Indian proverb that says Blessed is you who plants trees under whose shade he will never sit. And this really sums up what this concept is. It's the act of investing to ensure the financial freedom of future generations.
• 9:56
  Arthi Rabikrisson: Oh Malika, I mean that is such a beautiful representation of all the things that make our country so special. And I love that last quote as well. I mean, you've shared how there's so much opportunity to make our future brighter, right? And speaking of opportunity, the next example everyone have crowdfunding or Ubuntu refers to a partnership.
• 10:20
  Arthi Rabikrisson: Okay, so let's assume that we are keen to get into property investing, okay, as an additional source of income.
• 10:27
  Arthi Rabikrisson: You'll remember from our previous episodes, we've talked about property as well. If you haven't, please go back and review, you'll learn a couple of interesting tidbits around that right properties, not all, but it seems, there's lots of different opportunities there too. So coming back, we could think about forming a partnership with, let's say, two to three other people, okay. And we purchased this property together, it needs to be renovated, maybe we want to on sell it again, maybe go into rented and get some income, there's different things that could happen. But now that we're in a partnership, everyone in the partnership can gain access to funding as a group, right.
• 11:03
  Arthi Rabikrisson: And that will allow you to go into this investment. The other key thing is you've got access to expertise, right, everyone may have had different kind of very important right to kind of pull all of this collective knowledge as well. And and also share that responsibility in the venture. In most instances, Malika, I think ventures like these, in addition to other forms of investments, so income, you as an individual, you may not have that full capacity to to undergo and do this. But now when you get this kind of support with people in the venture, I think he just makes a world of difference. So this particular scenario, everyone the shared responsibility, this clear definition, okay, this clear accountability. Okay, so I'm painting a really idealistic picture here. But again, there's a few things you need to consider, okay, this is my risk lens always coming in, right?
• 12:00
  Arthi Rabikrisson: Firstly, it's quite imperative that you have a proper partnership agreement in place, okay, it must define the terms of this partnership. So everybody then can be accountable, what they be accountable for, right, so important to govern the relationship, also define how you're going to resolve disputes should and when they arise, and obviously we hoping it doesn't but this is business, this is an investment, we could disagree and have differences of opinion.
• 12:30
  Arthi Rabikrisson: So have some sort of way to be able to resolve that, especially if it tends to escalate. Also have a very clear understanding everybody, of how this particular property investment, for example, fits in with your overall financial plan. Remember that right, we building out our moneyverse we're looking for financial freedom, each of you are going to have different things in this pool of what you're looking to gain out. So also understand for yourself, how this is going to work for you. And please do speak to your financial advisor, so that you're working together with a different partner now of course, to ensure that your clear path is planned for it's clear exactly how this venture is gonna fit in to the bigger plan that you're hoping to get.
• 13:16
  Malika Petersen: Yeah, that's absolutely key Arthi I mean, like, with everything, we discuss how it all fits into your personal financial plan is absolutely imperative, right.
• 13:26
  Malika Petersen: And I want our listeners to remember that the last example of crowdfunding or Ubuntu is for those who are looking to start a business now, you would have created your business plan and done all the necessary market research around your market opportunities. And once that's all completed, and you're ready to start your business, there are various ways of very raising capital to do so you could go to a bank, to learn the money, you could try and get investors, etc, etc. So one of the ways of raising funding to start your business initiative, or your entrepreneurial adventure is crowdfunding. So what this essentially means is that you approach people with your business idea, and they contribute towards your funding because they believe in your idea, or they believe in the growth of a certain area ectera.
• 14:19
  Malika Petersen: Right now, there are many ways of doing this. There are platforms like fundo who that allows people to support your initiative, and they're basically encouraging you to the system. And the nice thing about this is that they expose you to a community of people that are able to assist with anything from resources, information, expertise, networking opportunities to financial assistance. It's a vast array of things that you can gain access to. And generally these are mainly people who want to support a community or are interested in funding a business idea to do so. Your plan needs to very clearly include how this is going to benefit that community, or sometimes the environment. Some people are into Crowd investments, or crowdfunding investments are really they want to see ideas that is going to improve the environment. And they they're happy to contribute money towards that, or just society as a whole, to make sure that you articulate your plan with those things in mind.
• 15:25
  Arthi Rabikrisson: I'm so glad you mentioned this particular thing about the business. I've dabbled in it Malika. And I must say, I mean, there's so many firstly, platforms out there. So you've mentioned one, locally in South Africa. This thing's like bac-a-buddy, GoFundMe, internationally, there is kick starter as well and Crowdcube.
• 15:41
  Arthi Rabikrisson: But one of the things through my own experiences, and I think I want to share this now with our listeners, is this definitely some do's and don'ts on crowdfunding? And maybe let's think of it from this business perspective then Malika. So what comes to your mind then, in terms of some of these dos and don'ts when it comes to crowdfunding, if you're starting up a small business?
• 16:03
  Malika Petersen: So i think let's start with the do's, right? A key first one is to communicate, communicate and communicate some more, right? I think those who are investing in you want to be kept updated, generally, but also often,
• 16:18
  Arthi Rabikrisson: Yeah, I think that's such a valuable point to right, you need to share the win. But you also need to share underscore Malika. I mean, I've just noticed on some of the the difficulties, you never know where that helping hand is going to come from to solve the problem when you need it most platforms, those who are responding timously we're right. So which ever you are whichever platform you end up using or choosing do a regular post, if people are creating updating regularly. It's like exciting renewal and investing things respond timelessly, this is part of your brand and in that right, because you feel like you're walking the journey reputation. And it is a responsibility that you have to those who have funded you entrepreneurship. So both have is that partnership is that connected piece we're talking credibility, to set up for your next rounds of funding.
• 16:57
  Malika Petersen: I know for sure, for sure. And I think in about? And you know, everyone, there's a variety of ways to terms of keeping it real. I think a key is don't share on communicate with funders. I mean, don't just think you have to now put, I mean, this is the age of video and AI and all of platforms outside funding, unnecessarily right? funders that stuff. So use those kinds of tools, use graphics, use are really using that platform to communicate with you. So be video, keep it real, but also keep it refreshing respectful and mindful. That is a reason behind that. That it may be it may be tempting to publicise widely, but use your discretion
• 18:01
  Arthi Rabikrisson: I think from some of mine, I mean, there's certain things I wouldn't want others to kind of know about, because I'm using that particular platform. So I think that's a really beautiful reason. And I know, we've seen, you know, post regularly and keep things live and real. So your funders are interested. But I think another thing that I've noticed that works really well is, especially as you're growing when you're getting a lot of funders, and it's very tempting, you want to try and like ensure you're getting in touch with everyone directly. So initially, that might be very possible when it's just those few. But let's say you're getting more and more people that are interested in what you're offering and your business and all of that. It's gonna become difficult. Okay.
• 18:43
  Arthi Rabikrisson: And often times people may have the same questions. So you trying to answer every single person, I think a smarter way to think about it is rather than to create something like a Frequently Asked Questions section. So FAQs. So if you're noticing people are asking similar questions, just add it to that FAQ section updated regularly. You can channel people into that space in case they're thinking about stuff. So the smart ways as well of managing the communication piece I think
• 19:12
  Malika Petersen: I know.
• 19:12
  Malika Petersen: Absolutely. And you just reminded me of something. Don't forget to take out liability insurance, its so important. I know insurance is seen as a grudge purchase to many of us and especially for small business where every penny counts. It can end up being expensive. But should you have claims against you or your business, you want to make sure that you know that you are covered. It's so important.
• 19:42
  Arthi Rabikrisson: Oh, I'm so glad I reminded you to point that out. That is so important.
• 19:44
  Arthi Rabikrisson: Okay, so I think maybe one final don't from me. And maybe it's something that we end up getting carried away because we're so excited that we're doing this is everyone don't expect that the funds will come rolling in immediately. It does not always happen that way. I think it often does trip us up where we're so excited about our business. We're enthused with putting ourselves out there to get crowdfunding, and you're expecting, oh, man, everybody's gonna buy into me.
• 20:13
  Arthi Rabikrisson: Unfortunately, it can take a little bit of time. So that whole idea about build it, and they will come to you remember that quote Malika in this day and age, it actually takes a lot more of dedicated time massaging communication to in order to entice funders to select your project to fund. So just be mindful this bit of time and energy that's going to be required before those funds come running in. Yeah.
• 20:39
  Malika Petersen: Yeah. So so far, we've given the do's and don'ts that we've we've mentioned and they speak directly to you wanting to get to that business or side hustle, right? But let's consider if you're investing in crowdfunding. Okay. So you are the founder? Yes. What are some of the do's and don'ts that apply there Arthi?
• 21:00
  Arthi Rabikrisson: Oh, okay. So I would say, definitely do know, the rules around the investment that you're funding. Also, what is the process to invest, okay?
• 21:09
  Arthi Rabikrisson: Even if you're just putting in like an absolute minimum amount, R500 or R1000, depending what that level might be for that opportunity for you know, what, what that means for you, from a tax perspective, an income perspective, the costs of using the platform, perhaps that you're choosing, in other words, everybody read and understand the T's and C's, there's always T's and C's. And then of course, read up more about the investment that you're supporting. Okay, knowledge is power, we always say this in our show. Okay. So ask questions, gain clarity from the funders or for founders, so your founders know what it is that you can expect, as a funder, you know, are you going to receive some kind of return? Are they going to be dividends? Are there other growths or ways in which you're going to get something by also by when is this going to happen?
• 22:02
  Arthi Rabikrisson: Right, be mindful? Are there any lock-ins that you need to be made aware of? So I guess all in all for summarises Malika, I'd say just be informed everybody.
• 22:15
  Arthi Rabikrisson: And also just take a vested interest, after all you putting the money in, right, as with anything around financial planning, you putting the money in, know what you can expect to get out of it. Lastly, I would say, always review any investment that you make, including crowd funding, in light of your financial goals.
• 22:31
  Arthi Rabikrisson: So we coming back to what we said earlier, it's so important, things change, life happens and so too, are your financial needs going to change everybody, so speak with your financial advisor, consult your financial coach, and use them to help you navigate this investment journey with their support.
• 22:53
  Malika Petersen: So a whole lot of key information to disgust I mean, indeed, it seems so easy. It seems quite thrilling.
• 22:58
  Arthi Rabikrisson: It is alot You know, and especially since we've set the scene about that Ubuntu nature, everything Malika, right? Because gives you that really warm feeling. But again, you talking from that is such a good way to actually evolve and build our community and environment and all of that.
• 23:17
  Arthi Rabikrisson: But also be prudent, that's required, because you never know what could go wrong. And you want to cover yourself against that. And I suppose o with that Malika we're coming to the end of our conversation. So what would be your parting shot for today?
• 23:35
  Malika Petersen: I think I mean, firstly, the whole episode has given me so much to think about, I think when we were prepping, again, we learning along with the listeners, which is awesome, and allows us to deep dive into the subjects which is great. And I think the one thing that stuck out to me, which is my parting shot for today's that we often get stuck on the reasons why we can't change our financial situation, right. But there are so many opportunities to build initiatives that lead to our economic growth, our family's economic growth, our community's economic growth as a result, our country's economic growth. And I think we must, and we mustn't forget that we mustn't forget.
• 24:17
  Malika Petersen: But at the end of the day, that's the true sense of Ubuntu.
• 24:21
  Malika Petersen: The true sense of Ubuntu is growth by osmosis, right we shared we help each other. So I think that that's a really important point that we have to remember.What about you Arthi, what is your parting shot?
• 24:33
  Arthi Rabikrisson: Ahh you giving me such warm and fuzzy feelings now as we're talking about it. And I love the alluding to the mindset and the habits and the beliefs which we spoken about previously as well in other episodes, listeners so take a listen to that. But I am such an optimist. I personally believe in the opportunity that crowdfunding offers, having, as Savvy everyone I mentioned, invested in projects myself, oh boy, did I make mistakes? I was so Green Malika, but you know, I quickly learned everyone and now I'm more critical as a result because of that learning I now know more and therefore I question more. Okay, all of these things that we're offering to you in terms of guidance and the ideas in in this area should you wish to consider it so everyone continue to explore the opportunities in front of you, but don't be blinded by fool's gold. Okay, you are savier then what you believe you're and of savvy Malika and with that Captain Jack Sparrow reference I course you can find out more as a result caught that I caught that onebefore we get to Worlds in On Stranger Tides.
• 25:46
  Malika Petersen: I know to find any dead mans chest
• 25:52
  Arthi Rabikrisson: catch you till the next episode everybody.
• 25:55
  Malika Petersen: Until then, ciao.
• 25:57
  Arthi Rabikrisson: Ciao
• 26:00
  Malika Petersen: Sharing is caring
• 26:02
  Arthi Rabikrisson: and knowledge is power
• 26:03
  Malika Petersen: time for you to be daring
• 26:06
  Arthi Rabikrisson: and let your money confidence bloom like a sunflower.
• 26:11
  Malika Petersen: Thanks for joining us. We hope you found these ideas and guidance useful
• 26:16
  Arthi Rabikrisson: do subscribe, share and write a review or send us comments. We would love to hear from you.
• 26:22
  Malika Petersen: Catch you on the next episode
• 26:24
  Arthi Rabikrisson: of the Swan effect podcast.
• 26:27
  Malika Petersen: Bye for now.
• 26:28
  Arthi Rabikrisson: Ciao.