The Strive Masiyiwa Story: Raising Our Game For The Next Level (Part 2)

By Strive Masiyiwa

The stand off with the Zimbabwe Stock Exchange, lasted less than two weeks. They quickly realised that we had found a legal loophole in their regulations, and they had no choice but to let us list the company, even though we had no trading history!

The Zimbabwe Stock Exchange is the second oldest in Africa, having been established in 1896.

Getting permission to list the company on the Stock Exchange, was not my biggest challenge. The exchange knew it, and I knew it, and it was probably why they said, “go ahead”…. No one seriously expected us to pull it off, and there were many good reasons why it was practically impossible:

Whilst I strongly believed that the general public would buy our shares, the problem was that we needed foreign exchange, not local currency. This is because 85%, of the money you need to set up a cell phone network goes into importing equipment, which is only produced by a handful of international manufacturers, even today.

To raise the money we needed as a public listed company, in what is called an Initial Public Offering (IPO), meant that we would have to raise the money from international investors, in Johannesburg, London and New York…….. And this was 1998!

– For a “start up” company, to try and raise money, through an IPO, was just unheard of;

– for a start up company coming from Africa, let alone Zimbabwe… That was also unheard of;

– we were considered an inexperienced management team, with no previous experience in the industry, and no “technical partner”!

– the long legal battle we had been through also made investors nervous.

– the cell phone industry in Africa, was just starting. Many African countries, including places like Nigeria, did not even have cell phones. Those countries that had cell phones, still had very few subscribers. It was an unproven industry.

After all those years of struggling to get a license, I was financially exhausted.

Investors who had the foreign exchange that we needed were only willing to invest, if I gave up control, and allowed a “technical partner” with experience to provide management. Most were not even willing to discuss the idea of my listing the company, before it was profitable, after three or four years.

In part three I will reveal to you, how we managed to raise money on the international capital markets. I also kept control of the business…And most important for me, I gave an opportunity for thousands of ordinary Zimbabwean’s to buy shares.

To be continued…