An entrepreneur challenges universities to stop glamorising entrepreneurship; advocates transparency on failure rates

Universities must desist from glamorising entrepreneurship and be open about its difficulties and high failure rate — the Chief Executive of Raizcorp, a company that grows and develops entrepreneurs in different contexts and in different stages of their lifecycles. The Chief Executive was speaking at a gala dinner on Day One of the annual Entrepreneurship Development in Higher Education (EDHE) Lekgotla 2025. The gala was hosted at the Maslow Hotel in Menlyn, Pretoria, on 8 October.

Raiz presented what he called the five conditions required to “precipitate” an entrepreneur, drawing on research showing that the most successful first-time entrepreneurs in the United States were 60 years and older.

The first condition for entrepreneurship is recognising an opportunity, experiencing a crisis, or encountering both. Raiz questioned whether young people can identify these opportunities, illustrating this point with a personal story: While in a boardroom with his business partner and a potential client, he and the partner immediately saw a promising opportunity as the client spoke—yet two staff members in the room failed to notice it.

This experience led Raiz to become involved in entrepreneurial education from Grade R to Grade 12 at Radley Private School in Randburg, where he has spent 10 years developing a framework for teaching entrepreneurship.

“What we were trying to do was create the mindset of entrepreneurship,” he said, explaining that students receive practical training to work in a boardroom, make cold calls, learn to sell, and present daily to build confidence.

“The biggest thing that we give the kids is not an entrepreneurial education, but it’s the confidence to go out there and present their ideas,” he said.

The second condition is pain tolerance, which Raiz linked to resilience. He introduced an acronym, CAC, standing for “Cannot Achieve Commercialisation,” to describe the constant rejection entrepreneurs face.

“Every entrepreneur in this room knows how much rejection and how many times we’ve been told it will never work,” he said.

Raiz asked how resilience could be built in education, stating that it is not just about teaching profit calculations but about developing the ability to persist through rejection.

The third condition is risk tolerance. Raiz noted that 22-year-old students have a higher risk tolerance than 45-year-olds with mortgages and children in school, similar to 60-year-olds whose bonds are paid off and children have left home.

He acknowledged a low entrepreneurial rate in South Africa and a high failure rate in the businesses that get started, stating that most entrepreneurs starting businesses in universities will fail.

“And that’s normal. It is okay, and is part of the learning process,” he said.

He acknowledged that South Africa has a low rate of entrepreneurship and a high failure rate among new businesses. He emphasised that most university-based startups are likely to fail.

“That’s normal,” he said. “It’s okay—it’s part of the learning process.”

He cited research showing that in the United States, the re-entry rate after business failure is 3.6, meaning entrepreneurs fail an average of 3.6 times before giving up. In South Africa, the re-entry rate is 1.14, meaning that entrepreneurs try once, fail, and give up.

Raiz blamed two factors – the banking system, which he said is not attuned to the entrepreneurial journey and South Africa’s culture of shame around failure.

He recounted meeting Professor Diane Francis at the World Economic Forum in Davos, who distinguished between America’s culture of fear and Canada’s culture of shame, suggesting that Commonwealth countries, including South Africa, operate with shame-based cultures.

“In America, they fear failure, but it’s not shameful,” he said, adding that American venture capitalists prefer entrepreneurs who have failed, while in South Africa, failure carries stigma.

“We need not shame failure in our society, and we need to back entrepreneurs who fail,” he said.

Raiz also shared a personal story of sleeping on the streets of Durban at age 23 before being backed by a billionaire who invested in his New York sausage factory business. After landing a job at a retail store, Raiz played a pivotal role in its turnaround—a remarkable success that caught the billionaire’s eye. When the sausage business failed and he wondered where he might have gone wrong, even contemplating leaving entrepreneurship entirely, the investor gave him a second chance.

“He said, ‘Did I back you or did I back the business?’ And I said, ‘You backed me.’ He said, ‘If you walk, if you get into that lift right now, you have failed. But if you try again, you can succeed,’” Raiz recalled.

The investor backed him again, this time with a team of people rather than just money. The second venture at the Pavilion Shopping Centre was a success. Raiz later sold the business.

“I was given a second chance. And as a result, thousands of people have become employed across the continent,” he said.

The fourth condition is the entrepreneur’s belief in their ability to master resources. Raiz distinguished between actual ability and belief in ability, noting that successful entrepreneurs have a level of self-belief that unsuccessful entrepreneurs do not.

He cited research in psychology showing that two of the biggest predictors of success are father issues and an over-doting mother. He explained that father issues create a psychological drive to prove oneself, while an over-doting mother provides self-belief.

“The fact that you are all here, I can surmise that you are relatively successful. If you look at each of your stories, there was one person — a teacher, an uncle, or a parent; at least one person who believed in you,” Raiz said.

He argued that the most important thing universities can do is to believe in entrepreneurs and give them second chances.

The fifth condition is the entrepreneur’s ability to learn and iterate. Raiz asked entrepreneurs in the room how many run the same business they started with, expecting no hands to rise.

“Successful entrepreneurs learn, get feedback and iterate. They change their models, their pricing, their product, or their systems,” he said.

Raiz’s audience comprised senior academics involved in entrepreneurship development at all 26 public universities; student entrepreneurs; executive management at the Universities South Africa (USAf) Office; and representatives of government and private sector partners of the EDHE programme.

He challenged universities on their selection of entrepreneurship lecturers and mentors. He described testing 31 entrepreneurial mentors at Raizcorp with a case study about a shop owner named Busi, who sells clothes, asking them to calculate her net profit. Only two could work out the answer.

“If we are serious about supporting entrepreneurs, we can’t have the 29 who can’t work out net profit being the ones who we put in front of entrepreneurs to say we believe in them,” he said.

At Raizcorp, which receives 50 to 100 applications daily, one in 100 applicants is accepted into programmes. The selection process does not require business plans, which Raiz said he tears up in front of entrepreneurs, because the essential aspect of an entrepreneur is knowing how they will generate revenue.

“How do you make money? If they cannot answer that question, then that business plan is worth nothing,” he said, noting that he has written a book titled Lose the Business Plan.

Instead, Raizcorp assesses 27 characteristics to determine acceptance. Entrepreneurs who are accepted work with guides — full-time employees required to study for four years on how to mentor entrepreneurs. A few people who apply to become guides succeed.

Raiz concluded by stating that entrepreneurship has been glamorised in society. In the 1960s and 1970s, becoming an entrepreneur meant one could not get a job, and entrepreneurs were looked down upon. However, today, they are revered.

“The reality is that entrepreneurship is very hard, with an extremely high failure rate. It requires sacrifice and often results in the loss of friends, family, and one’s health. We don’t share this side of the story either, and so young people who enter entrepreneurship enter with the wrong expectations,” he said.

He appealed to universities to stop suggesting that students need only attend an entrepreneurial course, create a business plan, and obtain funding to succeed, reiterating the responsibility to communicate truthfully about the challenges of entrepreneurship while emphasising that the journey is worthwhile, even in the face of failure.

Nqobile Tembe is Universities South Africa’s Communication Consultant.