“Do you think it will last until December?” This is Edward’s* main concern. Two months ago he invested R500 in a new get-rich-quick scheme, Gollong Investments.After just 40 days, Edward, from Thohoyandou in Limpopo, received a notification that his balance with Gollong was now R800, showing a welcome R300 profit. The investment generated a 60% return, not bad going for just over a month.
South Africans have seen many such schemes take off and then collapse after the people behind them disappeared with their cash. The most famous was probably Adriaan Nieuwoudt and histhat took the country by storm in the 1980s. This involved the cultivation of milk yeast cultures and a wonder beauty cream. The pyramid collapsed and Nieuwoudt was sequestrated.
From what we could gather from the company’s various websites, its presentation video on Youtube, and other sources we discovered, the scheme invites investors to “rent” different types of solar equipment including battery packs, solar panels and charging stations that can be used during rolling blackouts. Once the investor “rents” the equipment, the equipment is then on-rented to end users who pay to use them.
Gollong offers investments in a variety of “products”. The bottom-of-the-line product is a six-slot power bank, which can be “rented” by the investor for R230 over a 40-day cycle. This, they claim, pays out R320 at the end of the cycle. Calculating the return on investment on an annual basis, it’s clear that percentage profits claimed are unrealistic. The supposed return on investment on the lowest investment of R230 would yield an annual return of 357%, which is about 350 percentage points more than you’ll get at a commercial bank.
Adoozy Power rents out power banks similar to the ones used in Gollong’s marketing material. “We give the end consumer an opportunity to rent a power bank in one location and return it … at any other Power Tower throughout the Adoozy network which includes Johannesburg, Cape Town, and Durban,” the company says on its website.