Founded on empowerment, focused on women

Written by Emma Dawson • Online since 3.03.2016 • Filed under Press Release • From Issue 3 - March 2016 - August 2016 page(s) 10-13
Founded on empowerment, focused on women

A little more than 20 years since the launch of Women Investment Portfolio Holdings, EMMA DAWSON talks to the Founder and Group CEO, LOUISA MOJELA, about her and her fellow founders’ vision for broad self-empowerment and a dream of urging generations of women towards financial independence.

FEW people noticed the inauguration of Women Investment Portfolio Holdings (Wiphold) in 1994. It was, after all, a watershed year for South Africa and the national focus fell on the enormous shifts taking place after more than 40 years of apartheid. Besides, opening a small investment firm, by women for that matter, was nothing new or remarkable. But Wiphold is remarkable – a financial services operation established by four black women at a time when democratic freedoms had only just been afforded to all South Africans. Wiphold challenged an industry heavily skewed along racial and gender lines, but 1994 was a unique opportunity for everyone. ‘We recognized that this was the one time when no one knew anything; there was a new conversation taking place, and both men and women, white and black, felt a little out of their depth. If ever there was a time to strike out on your own it was then,’ recalls Louisa Mojela, Wiphold’s CEO. Wiphold is a story of great vision, ambition and resounding success. With a modest start-up contribution of R500 000, today Wiphold is a more than R2-billion investment giant that has distributed close to R500 million to shareholders and beneficiaries over the last 20 years. More than this, it is a story of self-broad-empowerment and smart decision making that continues to urge generations of women toward financial independence. Empowerment, sustainability, integrity and the creative exchange between profit and people are Wiphold’s guiding watchwords, underscoring everything it does.

In the beginning…

On a Sunday morning in mid-April 1994, Louisa Mojela and Wendy Luhabe attended a workshop run by former Governor, Tito Mboweni, then head of the ANC’s Economic Department. The workshop focused on discussing opportunities for black professionals under the new government. Although the workshop emphasized opportunities for blacks, what its organisers really meant was black men. Never was it acknowledged that women were doubly disadvantaged under apartheid, both for their race and gender. ‘The challenge was for us to do it for ourselves,’ Louisa comments. ‘This was a defining moment in the creation of Wiphold and the point at which we decided that whatever we did needed to involve critical mass if we were serious about the empowerment of women,’ she adds. Both Wendy and Louisa recognised that a successful venture had to have a team behind it and began earmarking key women to buy into the Wiphold idea. In the end two others – Gloria Tomatoe Serobe and Nomhle Canca – joined Wendy and Louisa to establish the WIP Four, as they called themselves. Today, Louisa and Gloria, remain at the company’s helm. ‘The minute I told Gloria, now CEO of  WIPCapital, about the idea she was sold. In fact, she ran with it faster than both Wendy and me,’

Louisa quips. ‘I’ll always remember something she kept repeating: “the strength of this vision is in the numbers; we must mobilise these women now.”’ The Wiphold vision was not without sacrifice. All four women held fulltime jobs, which meant that the project could only be worked on after hours and often long into the night. ‘We were trying to crystallise and articulate exactly what Wiphold should be,’ Louisa remembers, ‘and that took time and concentration.’ But if Wiphold took time and concentration, it also took money. ‘By the end of 1994, we eventually borrowed funds from friends and family and drew on our own limited savings to collectively raise R500 000,’ Louisa says.

It had to be financial services

After many after-hours discussions and the firm commitment of seed capital, the WIP Four finalised their vision for the company – a company dedicated to the empowerment of women. It would use financial services and strategic investments to realise this vision on a large economic scale, converting the collective strength of women’s purchasing power and labour provision into scalable and profitable investment opportunities. Within a month of coming together, the WIP Four settled on their investment strategy and criteria for selecting investments. They also quickly decided that financial services would be the company’s core focus. ‘We knew that this sector would pose challenges – a male-dominated industry and strong perceptions of men as the heads of households,’ Gloria comments. ‘But I wanted Wiphold to become a global influencer and pointed out that worldwide there are three main investors in an economy: banks (representing millions of depositors), insurance companies (representing policyholders) and retirement funds. These industries largely dictate the movement and channelling of funds. If we wanted to be an influential company that championed the rights and roles of women we needed clout; we needed the ability to build and invest in new projects. Financial services was the way to achieve this,’ Gloria maintains. She adds: ‘The WIP Four all have backgrounds in finance and business, which made this sector a natural fit.’ While financial services formed the company’s core focus, a portfolio of strategic investments and business partnerships would also be established in other sectors.

On the road

From the outset, Wiphold’s founders were committed to running a business that was both profitable and motivated by social change. To convert the collective strength of women’s purchasing power into lucrative investment opportunities meant mobilising a mass movement of women from the ground up. To do this, Wiphold’s founders conducted roadshows across South Africa’s nine provinces, presenting their vision for a women-led, women-run investment fund, and offering these women in some of the poorest areas of the country a stake in the world of big business and real returns. They also spent time educating women about the idea of investment. While they couldn’t accept investments at the time because they were not registered, they were to return two years later to collect contributions from would-be shareholders via a sound and professional capital raising overseen by Standard Merchant Bank, Edward Nathan and Deloitte and Touché. It was important that corporate governance was instilled in the company from the very beginning. ‘Our primary goal was to teach women to pursue financial independence and make their own decisions. Another important aspect was to explain that investments have their own cycles and that our investors should create a nest egg while good times prevail,’ Louisa maintains. Wiphold’s first major investment success came from Geoff Snelgar at Baobab, where a R3-million investment yielded a return of over R200 million. A number of other successes followed and, by 1997, Wiphold became the first South African company to open a public offer exclusively to women, raising R25 million and attracting 18 000 women as shareholders and beneficiaries. ‘One of my career highlights was watching our first-time investors from all over South Africa respond to our initial public offering,’ Gloria enthuses . In 1999, after securing an additional R500 million funding from institutional investors, Wiphold listed on the Johannesburg Stock Exchange (JSE) with a market capitalisation of R804 million. It was the first black, women-owned and women-managed firm to list on the JSE. In 2003, Wiphold delisted from the JSE to focus on increasing the economic ownership of black women in the company. Today, Wiphold is 35% owned by management and staff, 32.5% owned by Old Mutual, and 32.5% owned by two broad-based trusts. The company’s original 18 000 women beneficiaries fall under the umbrella of the Wiphold Investment Trust, of which they became beneficiaries at no cost provided that they had subscribed to the initial public offer and participated in the rights offer of 1998.

Business development and empowerment

Wiphold actively implements business strategies to empower its beneficiaries and the communities in which its beneficiaries and/or investee companies’ operations are located. One of Wiphold’s key focus areas is BEE enterprise development, where new BEE companies are introduced to BEE deals. Wiphold is a Level 1 empowerment contributor. In South Africa, Wiphold’s resources and infrastructure portfolio currently focuses on coal mining – a partnership with Sasol Mining in Ixia Coal, which is operated by women; and cement manufacturing in a joint venture with Continental Cement and Jidong Development Group of China. Wiphold has a 25.1% shareholding in Landis+Gyr – the South African operation of the worldwide Landis+Gyr Group, a global leader in metering solutions, from credit and prepayment metering to meter test equipment. Lumber is another key focus area for Wiphold, and here the company holds a 9% share in the Hans Merensky Group – South Africa’s largest lumber product manufacturer and sub-tropical fruit grower. ‘Our investments in the financial sector are dominated by strategic partnerships with banking and financial services giants – Old Mutual, Nedbank and Mutual & Federal – but also include holdings in niche financial service provider, WipCapital (100%),’ Louisa explains. ‘WIPCapital was formed in 1999 as Wiphold’s financial services wing with start-up funding of R300 million. The new division quickly attracted talented people, soon becoming a credible and  sought-after business,’ Gloria points out. In a fierce acquisition drive, WipCapital acquired controlling stakes in a treasury business (renamed WipTreasury Solutions), Futuregrowth Asset Management and Legae Securities (South Africa’s first black stockbroker and, later, hedge funds manager). While not every investment has been an unmitigated success, Louisa is keen to point out the advantage of sound corporate advisors. ‘To fulfil our vision of empowering large numbers of women and bring them into the mainstream economy, we needed to hire the best corporate advisors. This is expensive, but has reaped rewards on a number of occasions. Through WIPCapital we now have our own in-house advisors, which saves money and is a crucial element to our success.’ As far as strategic and value investments are concerned, the group has stakes in the Distell Group, Afrisun Leisure and MCG Industries. It also has a significant shareholding in human capital development providers, Adcorp, and USB-Ed – the executive education arm of the University of Stellenbosch Business School.

Corporate social investments and projects

‘We firmly believe in corporate social investment (CSI),’ says Louisa. ‘As we become successful and generate sound investment returns, we must give back to communities. It’s important to determine how we can assist those less fortunate and improve their lives.’ Wiphold’s CSIs are geared towards women and children, and are largely based in rural areas in the form of agricultural projects, schools and libraries, to name but a few. ‘We want to leave something tangible behind that can be there for years to come,’ she insists. In 2009, Wiphold and Sasol Mining launched an initiative that enabled thousands of rural and peri-urban woman to participate in a BEE transaction for the first time. Valued at almost R1.9 billion, the deal resulted in Wiphold and these women becoming Sasol Mining’s BEE partner through a new entity called WipCoal Investments. WipCoal Investments is the majority shareholder in a coal mining company called Ixia Coal, which is controlled by black women and has a 20% share in Sasol Mining. WipCoal Investments is jointly owned by Wiphold and Mining Women Investments, which comprises of 4 000 women drawn from the areas in which Sasol Mining has operations and coal reserves. Another important Wiphold project is Imbizo – a transformational financial services strategy developed and driven by Wiphold for the Old Mutual Group. It is a sustainable financial inclusion strategy that offers communities safe savings, safe and appropriately designed loans, and appropriate insurance services. This project helps communities to enhance incomes, acquire capital, manage risk, and move out of poverty. ‘One of Imbizo’s non-negotiable principles is that while some philanthropy is deployed, almost all of what we do is done on a commercial basis. Our experience shows that this approach is more sustainable than a predominantly grant-based model. Another key underlying principle is that income generation and wealth creation for communities must sit at the centre of the business model,’ Louisa maintains. To address the food security crisis, Wiphold has invested in the development of small-scale commercial agriculture in South Africa. The first agri-initiative was an Agri-Investment Fund aimed at realising meaningful profits so as to attract investors. Recognising that rural residents need social assistance to operate commercially, the second part of this initiative is social mobilisation. This means facilitating the right conversations between communities, financial institutions, government agencies, suppliers and retailers. On the education front, Wiphold is up-scaling its involvement in education by participating directly with schools through the Tiyo Soga initiative. The idea of this initiative is to perfect a model for both learner and teacher development that can be reproduced around the country.

Into the future…

‘We’ve always had really positive chemistry among the Wip Four, and our vision for success has remained firm. As the first black-owned investment company it has always been important for us to succeed and pave the way for those coming behind us. Failure was never an option,’ Louisa insists.

And these are lessons she and Gloria are instilling in two of their protégés – Nontobeko Ndhlazi: Group: Chief Financial Officer, and Gugu Dingaan, an Investment Executive. ‘Nontobeko and Gugu are our future leaders at Wiphold. It’s important for us to create space for the next generation, to harness their talent, and lead them in the right direction. If we don’t do this, we’re at risk of losing them. While this is about giving back and passing on the baton, it’s also about establishing a strong succession plan for Wiphold to continue making a difference in women’s lives,’ Louisa says. Nontobeko comments: ‘It’s been a true inspiration working so closely with Louisa and Gloria. I’ve learnt so much from them simply through informal, day-to-day mentoring. They bring such a wealth of  experience and knowledge that I’ve been absorbing for the past few years. I really appreciate knowing that they’ve got my best interests at heart, and that they’re always there to assist me when needed. Another really important factor for me is that I’m encouraged to bring my whole personality to work. All facets of yourself are welcomed – woman, wife and mother,’ she enthuses. To this, Gugu adds: ‘Wiphold’s success not only lies in its commitment to empowerment, but also because it houses the necessary skills to make good on its vision. In 2005, before my 30th birthday, I was given the opportunity to sit on a listed company’s board with a highly-experienced team. This is the kind of exposure and knowledge that has nurtured and shaped my career, and the people that have supported me through thick and thin. It’s also important to me that we’re not just about the bottom line. We really care about the society in which we live.’

Real transformation

Discussing her company’s vision and ethos, Louisa notes: ‘Quietly, at the forefront of real  transformation over the years, our aim has always been to integrate socio-economic development into our business model. We have proved that this can be done successfully and to the benefit of all stakeholders. Our approach has always been broad-based because we believe in active empowerment, wealth creation and community support, rather than depending on the “trickle-down effect”. We have pioneered a new way of doing business and, despite the challenges, we have created an investment group that is genuinely focused on the triple bottom line: on people as well as profits.’

‘The empowerment of women is not just a local issue. We hope to be a catalyst for change in the global environment and to aggressively grow our net asset value. We envisage opportunities outside South Africa to drive this growth,’ Louisa concludes.

Women Investment Portfolio Holdings

W www.wiphold.com

Issue 3 - March 2016 - August 2016

Issue 3 - March 2016 - August 2016

This article was featured on page 10-13 of SABI Magazine Issue 3 - March 2016 - August 2016 .

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