Finweek English Edition - - TECHNOLOGY - Si­mon Din­gle

Michael Jor­daan has been Can the world’s most in­no­va­tive banker guide the South African so­cial net­work­ing firm to the next level?

For­mer FNB boss Michael Jor­daan has re­vealed his next move, be­ing ap­pointed as chair­man of the board at South African so­cial net­work­ing com­pany Mxit. The com­pany is work­ing hard to trans­form its busi­ness in the smart­phone era and Jor­daan is the right guy to pro­vide steer – but can Mxit tackle the likes of Face­book and win on the mo­bile bat­tle­front?

New Mxit CEO Fran­cois Swart clearly thinks so. He an­nounced Jor­daan’s ap­point­ment as a “coup” for the com­pany. Swart was re­cently made CEO fol­low­ing a ten­ure as in­terim CEO when Alan Knot­tCraig Jr left the com­pany af­ter a fall­out with in­vestors.

In a state­ment, Jor­daan said that he has been watch­ing Mxit “with in­ter­est” for sev­eral years. He’s also close to RMB rat pack mem­bers GT Fer­reira and Paul Har­ris, who are ma­jor in­vestors in Mxit.

“It is dif­fi­cult not to have a sense of pride about a home-grown South African com­pany mak­ing such an im­pact in the so­cial me­dia and mo­bile space,” said Jor­daan.

“Mxit is a re­ally cool com­pany and has built some world-first in­no­va­tions over the last eight years. I have spent some time with their de­vel­op­ment and de­sign team and they have shown me some of the projects they are work­ing on, es­pe­cially in the smart­phone space,” he said.

Mxit has a great po­si­tion from which to grow. Jor­daan said on Twit­ter that the net­work has 7m ac­tive users who are on it for an av­er­age of 90 min­utes per day. That’s nowhere close to the 1bn peo­ple us­ing Face­book, but is noth­ing to laugh at.

It is less than Mxit used to have, how­ever. The one-time king of so­cial net­works in SA has been knocked off its throne. World Wide Worx’ SA So­cial Me­dia Land­scape 2014 re­search study re­vealed that Face­book now has 9.4m ac­tive users in SA, up from 6.8m a year ago.

Mxit dropped from 9.5m to its cur­rent 7.4m. Twit­ter saw the high­est per­cent­age growth among the ma­jor so­cial net­works in SA, grow­ing from 2.4m to 5.5m.

“No less than 87% of Face­book users and 85% of Twit­ter users are ac­cess­ing th­ese tools on their phones,” said Arthur Gold­stuck, MD of World Wide Worx.

And this is Mxit’s chal­lenge as mo­bile is fun­da­men­tal to the ser­vice. Mxit was built on mo­bile, be­gin­ning as a mes­sag­ing ser­vice. It has lost out in that space to What­sApp, BBM and other mes­sag­ing gi­ants, while its growth as a so­cial net­work­ing com­pany is un­der threat from Zucker­berg and co.

Mxit does do work in health­care and ed­u­ca­tion where in­ter­na­tional play­ers are ab­sent, how­ever, and th­ese lo­cal dif­fer­en­tia­tors could be key to its suc­cess. This more al­tru­is­tic side of the Mxit busi­ness is also some­thing Jor­daan said he is ex­cited about. He also said that this is some­thing that makes Mxit unique.

With Jor­daan on board, so to speak, and the likes of Vin­cent Ma­her and Andy Volk work­ing with new CEO Fran­cois Swart, Mxit is poised for great things – if it can re­de­fine it­self on smart­phones and lever­age its grasp of African cus­tomers.

Michael Jor­daan & Fran­cois Swart (right)

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