In his autobiography, titled And Then They Fired Me, South African entrepreneur Jannie Mouton says that doing business in the rest of the continent is “quite terrifying until you have mastered it”.[hidepost=9][/hidepost]
Mouton, who is 65 years old, started investment company PSG Group 15 years ago, after he was sacked from his position as managing director of SMK, a broking firm of which he was one of the founders. In his book, Mouton gives an overview of his career and shares some business insights.
He says that although Africa has many opportunities, the continent is still plagued by bribery, bureaucracy and logistical problems.
In addition, Mouton also highlights high hotel costs in many African countries as well as dealing with large amounts of cash due to the lack of developed banking systems as hurdles to doing business on the continent.
One company that PSG believes does have the know-how on how to deal with these challenges is CIC Holdings, a distributor of non-perishable food items in countries such as Zambia, Mozambique, Botswana, Namibia and South Africa. PSG, through its private equity arm Paladin Capital, in 2006 bought a stake in CIC, but later sold it because CEO Trevor Rogers, who was instrumental to CIC’s success, had reached retirement age.
According to Mouton, if South African bank Capitec, in which PSG holds a significant stake, were ever to enter the Angolan market, it would be preferable to do it through a local partner in that country “who already knows how things work”. The company was therefore tempted to buy the African branches of micro-finance institution Blue Financial Services because it had already “mastered the bureaucracy” in numerous countries where it has a presence. In the end, however, the deal did not happen.