Beyond the sparkle

Online since 22.03.2018 • Filed under Entrepreneurs • From Issue 7 - March to August 2018 page(s) 14-16
Beyond the sparkle

If we buy local we can say that we’re proudly South African – we come from here, we contribute to changing lives here, and we’re creating and sustaining jobs here. Emma Dawson talks to Kealeboga and Ursula Pule, the founders of Nungu Diamonds, about this message and how they’re changing the dialogue about diamond purchasing and manufacturing in South Africa.

Over three-billion years ago, diamonds were formed deep in the Earth’s crust under extreme conditions of heat and pressure that caused carbon atoms to crystallise. The word ‘diamond’ comes from the Greek word ‘Adamas’, which means invincible – a word that also aptly applies to husband and wife duo, Kealeboga and Ursula Pule, owners of Nungu Diamonds.

Married two years ago, Kealeboga and Ursula are now the proud parents of baby Amantle who has dramatically changed the way the pair view life. Mostly it’s been a catalyst for adapting their business to provide a legacy for their children.

But the story begins some time ago. ‘I met Ursula during the third year of my Law Degree,’ says Kealeboga. ‘At the time I was beginning to develop an interest in minerals and the mining industry and was fortunate to meet someone with a diamond business. He was based in Johannesburg so, in 2010, I went to meet him. He suggested that if I was interested in getting into the diamond business I’d better move to Johannesburg the following year, which was also the year I was graduating,’ he recalls.

‘My parents weren’t happy. My Dad saw me fulfilling a career as an advocate but, nevertheless, in 2011 Ursula and I moved to Johannesburg where I began my mentorship. My mentor was buying from De Beers, and manufacturing and selling diamonds to global clients. This helped me learn about how the industry works, how to get licenses, how to get a supply of diamonds, and how to establish a factory,’ Kealeboga comments.

The dream begins

In 2013, with a solid mentorship under Kealeboga’s belt and the knowledge they needed, the couple launched their own business, Nungu Diamonds. With a background in fashion, Ursula worked for a short while before joining Kealeboga in Nungu Diamonds. To supplement their income, she worked part time while making clothing.

Then, in 2017, with the business well established and growing, Kealeboga suggested Ursula begin working full time at Nungu Diamonds, particularly as they are about to begin manufacturing jewellery.

‘While diamonds are synonymous with South Africa, unfortunately South Africans don’t consume many of the diamonds that are manufactured and mined here. Our market is predominantly export but this is something we’re very keen to change. The reason for low local purchasing is not just because of the country’s economy, but also because people don’t know about South Africa’s diamonds, and how and why they should buy them,’ he insists.

‘We’re now moving into jewellery, but you’ll find that the big jewellers are only too happy for customers to know very little about buying diamonds,’ he adds. Kealeboga has spent time in China and Hong Kong where he says customers will tell you that they want a specific colour and carat, and they roughly know how much it should cost. ‘The Chinese public are knowledgeable about diamonds, unlike South Africans who, in a country where diamonds are mined, know little to nothing about them. We believe our job is to educate South Africans and show people that you can have a pair of diamond studs, a beautiful ring, or a necklace with a diamond pendant that doesn’t have to cost you an arm and a leg,’ Ursula insists.

‘And there’s an element of investment there too,’ adds Kealeboga. ‘You can buy a one carat diamond, the smallest available, and sell it for the same value 10 years later.’

So, rather than viewing diamonds as just an heirloom that’s passed down through the generations, people should be considering their investment value too. It’s also important to note that the value of a diamond, once set in jewellery, doesn’t devalue. Unlike gold, which when mixed with other materials to set jewellery diminishes the gold’s purity and decreases its value, diamonds maintain theirs.

Diamonds and the African continent

‘What I’m personally very passionate about is the link between diamonds, the African continent and specifically South Africa,’ says Kealeboga. ‘We believe our people need to wear diamonds because they come from here.

Not all diamonds cost a million rand – there’s a diamond that can fit most people’s budgets. So, it’s a question of ensuring that people understand that they’re not just expensive. We want to change this narrative.’ He adds: ‘As Ursula mentioned, I’ve been to China and Hong Kong and on every street corner there’s a shop selling diamonds. People walk in to buy loose diamonds and jewellery that they wear every day. The perception there is that diamonds are beautiful, not just something to buy for an engagement.’

When asked why there’s such a lack of knowledge about diamonds in South Africa, Kealeboga says that traditionally the industry has been very secretive. ‘For example, when I told my parents about my plans to manufacture diamonds they wanted to know if it’s legal,’ he says. ‘And this is a view generally associated with diamonds, particularly on the African continent.’

Lost opportunities

But, you can’t blame Africa or South Africa for this perception. Diamonds have fuelled wars and people have lost lives because of them and they’re still viewed in the same light. However, South Africa is missing out because of it. From an economic point of view, diamonds sustain eight million jobs in India – a country that doesn’t mine diamonds. All the diamonds that are manufactured there come from Africa. ‘These eight million jobs should be African jobs, but perhaps to some extent our government isn’t seeing the diamond industry from a manufacturing perspective and as an opportunity to fuel job creation.

They just see it at a value-added mining level. Mining does create many jobs, but there are vast downstream opportunities that are missed. Even some of the diamonds sold in jewellery stores locally are mined in South Africa and manufactured elsewhere. What a loss!’, says Kealeboga.

From a manufacturing perspective, once we begin to see diamonds for the value they create, much more than just the investment alone, we need to consider what the country’s losing when we send a rough diamond to another country to be manufactured, cut and polished.

Connecting to our continent

‘We want young people to understand that while handbags are great, as part of our African story we should consider owning minerals,’ says Ursula. ‘This is a message we particularly want to get across to the ‘Afrilenials’ – the conscious African millennial generation who would prefer their hair to be natural, who express themselves with make-up or not, and who showcase African prints in their clothing choices,’ she adds. ‘We want them to consider wearing African diamonds to show their pride in where they come from. After all, if not you, then who? Who can “own” diamonds like us Africans can?’ To this, Kealeboga adds: ‘And this forms part of the new narrative we’re championing – being aware. We want people to say, “I am wearing what comes from my earth.” It’s this connectedness that we want to add value to. This new

narrative is an empowerment statement: “I’m wearing a part of a continent that I feel connected to.”’

Diamonds have traditionally been marketed as an elitist product, but they don’t have to be. ‘We believe we need a different approach – focussing more on the message and less on the product. Regardless of what the diamond costs, if people know the meaning behind the purchase – why you should own a South African diamond – you’ll want to purchase more because they’ll form a significant part of who you are,’ Kealeboga adds.

Provenance. Substance. Authenticity.

‘Our business tagline underpins the pillars of our business: Provenance. Substance. Authenticity. and we talk about provenance a lot,’ says Kealeboga. ‘We want people to understand that the value of diamonds goes beyond the sparkle. It’s not just about how pretty they are, but also about where they come from; who they support; the effect on the mining, manufacturing and jewellery making sectors; and ultimately the economy. If consumers and the government understand this, then people will buy them.

People buy expensive foreign-brand watches and foreignbrand cars, but we urge them to consider who they’re supporting by purchasing these,’ Kealeboga insists. The succinct answer to why we should buy diamonds is in Nungu Diamond’s pillars: Provenance refers to the source – diamonds are proudly part of who you are. Substance refers to the meaning of why you buy a diamond. If you know where it comes from, if you know its connection with who you are and where you come from, then when you buy it for yourself or as a gift you can say, ‘I’m giving you a Nungu Diamond, it’s been manufactured responsibly, and it has created jobs’. It goes beyond your love for this person. You’ll also be able to pass that diamond on to somebody one day and say, ‘you see this diamond? It comes from this place in South Africa, this is what it was able to do for people’. Authenticity encompasses all the above. It’s the sincerest form of showing love, and what better way than with something that embodies these values. ‘These are the things that Nungu Diamonds stands for,’ Kealeboga comments.

‘As a young couple in South Africa, we want to be seen as diamonds ourselves, but we shouldn’t be as rare as we are! There should be more of us,’ Ursula quips. We want to inspire young people to champion what’s ours, and to be concerned about what people take away from us (such as exporting our diamond manufacturing).’

To this Kealeboga adds: ‘In some cases, we’re being led by people who don’t understand the value of the roles they’re supposed to play. If you know that South Africa produces as many diamonds as it does, and 90% of them leave our shores and go somewhere else to create value for other people, we must question why. If you know that diamonds sustain economies of other countries when yours is dwindling, how are you giving it away? Is it an information deficit perhaps? Or is there an ignorance

because an inner echelon may be benefiting from the current status quo?’

Industry regulation

‘Using our Diamond Beneficiation License, we buy rough diamonds that we cut and polish (this is the manufacturing process). The industry is governed by a regulator – set up by the Department of Minerals Resources – called the South African Diamonds and Precious Metals Regulator (SADPMR). They are tasked with regulating the industry and awarding licenses to manufacturers.

‘We buy our diamonds from De Beers, which has mining operations in four countries, and we’re one of probably 11 or 12 of their clients in the country. We also buy from the State Diamond Trader, a government entity – an SOE set up by government to facilitate the manufacturing of diamonds. They buy rough diamonds from other producing companies, including De Beers, and they offer those diamonds to licence holders. Today, I think there are about 20 active diamond manufacturers in the country. The job numbers used to be impressive at about 3 000 people, but this number has now dwindled to around 200.

Paying it forward

Through partnerships, we’re working to give people a skillset that they can use in their own businesses,’

Kealeboga maintains. Kealeboga was instrumental in setting up an NGO called the South African Young Diamond Beneficiators Guild – an industry association that aims to bring more young people into the sector. ‘I sit on the board as vice president and co-founder,’ he says. ‘The purpose of this NGO is to encourage young people to enter the trade, and we offer mentorships because I want to do for them what was done for me.’

But they’re very particular about who enters the trade. ‘We’re looking for people that want to play a part in the industry. We’re not in the business of selling illicit diamonds. Every diamond we buy must have a certificate that proves its chain of custody.

Looking ahead

Kealeboga and Ursula have launched their own jewellery design and manufacturing brand. The company is called Medi Yame Diamonds. Medi means ‘roots’ in Setswana and Yame means ‘my’ – My Roots. Medi Yame is a collaboration between Nungu Diamonds and Kwame Diamonds, owned by Jo Mathole.

‘We’re also working with a diamond mining company and there are grand plans afoot but, for now, this will remain a story for another time,’ Kealeboga concludes.

Nungu Diamonds

Suit 319A, SA Jewellery Centre

225 Main Street, Johannesburg, 2000

T +27 (0)11 052 4557

W www.nungu-diamonds.co.za

Issue 7 - March to August 2018

Issue 7 - March to August 2018

This article was featured on page 14-16 of SABI Magazine Issue 7 - March to August 2018 .

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