Bekker searches for next big thing
WHEN Koos Bekker sets off on his yearlong sabbatical exploring digital hot spots around the world, he will immerse himself in different cultures.
Armed with a briefcase rather than a backpack, he will nevertheless, like the backpackers, be heading for places where the internet spurs innovation and young people are exploring new ways to work and play in the digital universe.
These are all places that hold the promise of the next big thing.
Bekker will spend time in South Korea, which dominates gaming and cellphone technology.
He will go to Europe, and particularly Berlin “which is emerging as a hot spot, mainly because young people want to live there: great nightlife and cheap apartments”.
He will head for China and New York, which is becoming a player where computers and people meet. He will go to Bangalore, where young Indian entrepreneurs are hungry and ambitious.
Bekker likes ambition and entrepreneurs. It worries him that the level of ambition of students in South Africa “is often pretty vague and small-scale”.
He has proved his ability to pick out fresh directions before they become trends, and used that to transform Naspers from a parochial Afrikaans newspaper and magazine publisher into a global media powerhouse worth $45billion, by investing in new technology and expanding markets, particularly in emerging markets such as sub-Saharan Africa, China, Latin America, Russia and India.
He brought in pay-TV and e-commerce. Then he moved deftly into China. Now he wants to find the next big wave.
Bekker talks of several lucky breaks, but it’s part of his engaging manner that belies a steely determination.
He says that while he happened to study for an MBA at Columbia University in the 1980s, he knew it was a nice enough university but didn’t have a plan.
Once there, he discovered that pay-TV was being born in the US, wrote a paper on how to transport it abroad and turn it over-the-air, then brought this idea back to South Africa.
That Bekker taps into commercial and societal shifts is evident, but in his personal life he is still part of an older generation that tends to prefer print.
“It’s a generation thing. I love your Sunday Times and the pink Financial Times, and during weekends I spend hours on newspapers, which I’d never do with an electronic medium. But that’s because I grew up with print — younger people derive the same pleasure from bloggers and digital. I guess print will slowly wither, especially when the internet moves on to cellphones.”
Bekker leaves at a point where Naspers’s share price seems to contin- ually reach new highs — a good point at which to hand over the reins.
“At several points, we were pretty stupid. We wasted great opportunities: we could’ve bought into companies like LinkedIn or could’ve increased our stake in Facebook when it was a fifth of its current value. We screwed up so often, I doubt there’s a media team out there that messed up more chances on more continents than we did.”
Early forays into China were quite disastrous, and cost shareholders tens of millions of dollars. Bekker said he should have been fired at least twice.
“Some of the deals we [did] were mistaken, and had to be written off, but failure has its purpose: often you learn a useful lesson for the future.”
Such a lesson was in China where the group lost $80-million before they bought a stake in Tencent, now Asia’s largest internet company. Today, Naspers owns 34% of Tencent.
Previously they put in western managers and the “useful lesson” from the failure was to find the smartest Chinese management team.
Naspers’s market cap sits at R500billion. Over the past 18 months the market has rerated both Tencent and Naspers after sharp growth and the launch of WeChat.
There were other roller-coaster rides. When MNet was some six months old in March 1987, the company was running at a loss of R3.5-million a month on revenue of half-a-million, and the owners were faced with imminent bankruptcy. But their collective stomachs held, and they scraped through.
Then there was the beginning of 2000. While Naspers was invested in young internet companies the dotcom bubble popped. Investors ran for the exits.
Naspers’s share price collapsed from nearly R100 to nearly R12. “But our board held their nerve – it was a close call.”
The digital universe is increasingly challenging. Last week, Facebook bought WhatsApp for $19-billion. Bekker said this would increase competition for Tencent, but he is confident of Tencent’s depth in China. “Outside of China, however, the battle will be tough,” he said.