"When did you first see the opportunity?"


By Strive Masiyiwa

Be an Entrepreneur 2

Understanding business models (Part 1)

 

"When did you first see the opportunity?"

 

When I first started Econet Wireless, I travelled to South Africa to meet the senior leadership of one of the leading mobile network companies. I was looking for investment into our business. I did the customary pitch and offered them 40% of my business. For some of you who have seen Shark Tank on Kwese Inc, it was a similar experience!

 

Their CEO balked at my price. "No way!" he said. "That is just too expensive!"

 

For several weeks we haggled over the price but we could not bridge the gap, and we decided to go our separate ways.

 

More than 10 years later, I ran into the chairman of that company at a reception, and he pulled me aside and said, "I really regret that we did not do that deal with you. Now I realize that your business was worth a lot more than you were asking for."

 

He nevertheless congratulated me and we kept close and friendly contact until he died. He was a wise old man.

 

This has happened to me many times. Sometimes I'm the one who walked away from a potential investment and sometimes I'm the one who missed out on a potentially great deal.

It's all business!

 

In that particular case, there was a reason we could not agree: I believed that the potential for growth in mobile phones was multiples higher than what they were projecting.

 

Even though we were both in the same industry and could be considered experts in our field, we had a dramatically different view on the impact of a new technology: "Pre-paid payment" system!

 

(At that time you could only get a contract. The pre-paid technology was invented in Israel, and it totally transformed the industry, allowing billions of people to get access.)

 

I believed it would change everything. They thought my assessment was exaggerated.

 

There are so many new technologies coming through these days. Do you know what great technology is going to dramatically impact your business or the company you work for?

 

Years ago I used to keep a quote from William Goldsmith (one of the first British billionaires) which said:

"If you see a bandwagon, it is already too late." What do you think that means?

 

Let's talk.

 

End.



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User's Comments:

Bs chandramohan

Strive Masiyiwa Afterthought 1. If you first "see" an opportunity only after seeing lots and lots of other people in your market make money with it, chances are you are now dealing with a "bandwagon."

July 10, 2017, 4:58 p.m. Reply
Bschandramohan

Strive Masiyiwa -- Afterthought 2. "What about being a "fast follower" you might ask? The "band wagon follower" is not "fast"! This is the guy still dreaming of a shop or grinding mill at a village where the first shop and grinding mill came 50 years ago!

July 10, 2017, 4:59 p.m. Reply
Bs chandramohan

Strive Masiyiwa-- Afterthought 3. So many people call me about cell phone licenses available in their country, and really get disappointed when I tell them I'm not interested. That "bandwagon" came and went long ago. No serious mobile operator is interested in a fresh license, unless it is Ethiopia! Now we focus on acquisitions and mergers in a very strategic way. Not every business for sale is worth buying!

July 10, 2017, 5:01 p.m. Reply
Bschandramohan

Strive Masiyiwa Strive Masiyiwa.. Afterthought--4 20 years ago every electronics and electric company in the world was trying to make a cell phone. There were hundreds of brands as everyone jumped on Nokia's bandwagon. Then 10 years ago a young computer guy came up with a disruptive idea by putting a computer in the phone, and called it a Smartphone. That guy was Steve Jobs of Apple. The other bandwagon led by Nokia crashed, including Nokia. There is now a new bandwagon but only a few guys that followed are making money.

July 10, 2017, 5:10 p.m. Reply

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