Fill­ing the cul­tural gap

‘We hear ter­ri­ble sto­ries about the runaround big banks put our clients through’

Finweek English Edition - - PEOPLE - SVET­LANA DONEVA svet­lanad@fin­week.co.za

A MAN WILL GROVEL for very few things in life. The first is for the at­ten­tion of a beau­ti­ful woman. The sec­ond, if that man hap­pens to live in South Africa and is start­ing his own busi­ness, is bank credit. En­trepreneur­ship in SA is a unique an­i­mal. It’s a far cry from the reck­less aban­don fund­ing and lov­ing hand­hold­ing of the United States en­ter­pris­ing mind­set.

“There’s a cul­tural gap. Bank man­agers tend to be bureau­cratic risk avoiders – the en­tre­pre­neur em­braces risk,” says Roland Sas­soon, co-founder of Sas­fin Bank, who has ded­i­cated a large por­tion of his ca­reer to the ar­du­ous task of mod­i­fy­ing the lack of en­tre­pre­neur sup­port and fund­ing in this coun­try. “I re­main more con­vinced than ever that the big banks just don’t have what it takes to fi­nance en­trepreneurs.”

Over the past 20 years Sas­soon has evolved Sas­fin into a multi-prod­uct fi­nan­cial in­sti­tu­tion while never los­ing sight of its orig­i­nal vi­sion of a bank for en­trepreneurs. He’s largely self-taught, fiercely am­bi­tious and sys­tem­atic in pur­su­ing his own per­sonal en­tre­pre­neur­ial goals. The com­pany was born in the early Fifties un­der a very dif­fer­ent guise. Sas­soon’s fa­ther Syd­ney, along with his six broth­ers, was run­ning a tex­tile mer­chan­dis­ing busi­ness, with roots world­wide. Syd­ney was hold­ing down the base in Jo­han­nes­burg.

By the Six­ties, sell­ing fab­ric in SA had be­come a per­ilous pur­suit. Dra­co­nian tar­iff and im­port con­trol pro­tec­tion mea­sures were im­posed to en­sure the growth of the coun­try’s own young fab­ric in­dus­try. The re­main­der of the Sas­soon clan fanned the flame by clam­our­ing to dis­in­vest from SA, partly due to jit­ters em­a­nat­ing from then Rhode­sia’s dec­la­ra­tion of in­de­pen­dence from Bri­tain in 1965.

The Sas­soon fa­ther and son duo – left with al­most no cap­i­tal fol­low­ing the break up of the fam­ily busi­ness – de­cided to pur­sue trade fi­nanc­ing af­ter iden­ti­fy­ing a gap for that ser­vice. The en­deav­our had mixed suc­cess, as the Sas­soons had lit­tle ex­pe­ri­ence in fi­nanc­ing. Roland Sas­soon em­barked on var­i­ous jobs at lo­cal banks, in­clud­ing Bar­clays, pro­vid­ing debtor, leas­ing and trade fi­nance with the in­ten­tion of gain­ing ex­pe­ri­ence. He even­tu­ally re­joined his fa­ther in the mid-Seven­ties.

Sas­fin, in its fi­nance house in­car­na­tion, grew quickly and re­quired more fund­ing. It went pub­lic in 1987 and Sas­soon was able to present the com­pany in a dif­fer­ent, more at­trac­tive light to SA’s big banks – which re­sponded by in­creas­ing the group’s fa­cil­i­ties and low­er­ing their rates. The list­ing had the ad­di­tional ad­van­tage of pro­vid­ing Sas­soon’s fa­ther and brother an exit from the busi­ness. “They were less risk averse and had dif­fer­ent as­pi­ra­tions to me,” he says. “The in­ten­tion had al­ways been I’d end up run­ning the busi­ness.” Un­der Sas­soon’s lead­er­ship Sas­fin has grown into a sig­nif­i­cant player in SA’s fi­nanc­ing sec­tor, pi­o­neer­ing the coun­try’s first se­cu­ri­ti­sa­tion deal in 1991, re­ceiv­ing a bank­ing li­cence in 1999, ac­quir­ing con­trol of pri­vate eq­uity group MDM and the pri­vate client base of se­cu­ri­ties firm Frankel Pol­lak, which opened doors to stock­broking and fi­nan­cial plan­ning.

Sas­soon re­mains com­mit­ted to Sas­fin’s bank­ing to fund en­trepreneurs’ vi­sions – a task he says SA’s Big Four are un­suited to per­form. “We hear ter­ri­ble sto­ries from our clients about the runaround the big banks put them through to get a fa­cil­ity in place. While we un­der­stand the im­por­tance of due dili­gence, we have to be mind­ful of the fact that an en­tre­pre­neur needs a de­ci­sive bank to en­able the client to ‘strike when the iron is hot’.”

The re­cent bank­ing cri­sis will af­ford Sas­fin (and its peers) more room to grow, says Sas­soon. The “too big to fail” in­sti­tu­tions are sub­ject to stricter reg­u­la­tion, which will in­evitably re­sult in even more bu­reau­cracy.

Date of Birth: Born in: Lives in: Mar­i­tal Sta­tus: Chil­dren:

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