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Upper Echelon Podcast: Antony Ball – non executive director, Brait SA

“I only know how to do things at one pace, and that’s flat out.”

ALEC HOGG: Upper Echelon is brought to you by Deloitte – for innovative thinking and thorough strategic planning turn to Deloitte. Antony Ball is in our Upper Echelon this week and interesting Antony going back through your past, I think if I’m right you did your articles with PWC, but you also worked for Deloitte and co-founded their strategy group. So you’ve got a bit of a connection with our sponsor.

ANTONY BALL: Indeed – happy years at Deloitte – I ended up starting my accounting articles at PriceWaterhouse and in the middle of that I got a Rhodes Scholarship to go and study at Oxford. So I did my two years at Oxford and when I came back Deloitte was the firm that in my view was doing interesting things in the consulting world. I had done my thesis on strategy consulting and so I brought to Deloitte an idea of doing strategy consulting from an accounting firm base and had seven very happy years there, and I think it was a great firm. It still is a great firm and I think it went through enormous growth at that time and a lot of my thinking about how organisations are built and how they developed are from what I learnt at my time at Deloitte.

ALEC HOGG: That’s interesting, but what did you learn at Oxford – Rhodes scholars are rare beasts…

ANTONY BALL: Actually more of them than you think. I did an equivalent of an MBA there – they described it as an MBA for poets. So it was an MBA but with the Oxford method of tutorials and essays rather than crammed full of case studies every day – so I had a terrific two years there where I learnt an awful lot. I often feel that my undergrad degree was a very programmed degree. I did a BCom getting ready for a CA, so auditing, tax, accounting and all of those things. And then I had the opportunity of doing a far more intellectually rigorous masters at Oxford which was great fun. I found myself very challenged there, but I enjoyed it a great deal.

ALEC HOGG: Looking back on those years, is it something that you feel hugely privileged to have done and that you would encourage young people to try and aim towards?

ANTONY BALL: Absolutely – I think it’s a huge privilege to have two years at one of the great universities of the world, fully paid and with all the things that go with it. And yes, I would encourage people – the scholarship is there. There are about eight of them from South Africa every year, about 55 from around the world and it’s a terrific scholarship to have…

ALEC HOGG: Do you keep in touch…

ANTONY BALL: I do in fact, in two respects – I’m on the Selection Committee of the St Andrews Rhodes Scholarship so I see the colours… which is great and then one of the things that I’ve done now is I’ve gone onto the Investment Committee of the Rhodes Trust. So I got involved in their investment programme which has been a great opportunity for me just to widen my horizons insofar as investment strategies are concerned.

ALEC HOGG: St Andrews – that’s Grahamstown – you were at school there.


ALEC HOGG: So do they have one Rhodes Scholar from the school every year?

ANTONY BALL: Well Rhodes, when he passed away, he thought there were four great schools at the time, and St. Andrews was one, being one of the older schools. It’s now shared with DSG, its sister school. So between DSG and St. Andrews, they award a scholar every year.

ALEC HOGG: Who were the other great schools, according to Rhodes?

ANTONY BALL: Bishops, Paul Roos and SACS were the other schools that get a scholarship.

ALEC HOGG: Fascinating. You had left Deloitte to really pioneer private equity in South Africa. That was in the early 1990s – back then very little was known of private equity. Are you surprised at the way that the asset class has grown and boomed?

ANTONY BALL: Surprised and delighted – it has grown from a very small start. If you go back to the 1970s and 1980s, it started very much as a cottage industry on the west coast of the US with venture capital more as its underlying investment theme and you find people there cobbling together, pools of capital of $5m or $20m and doing the two and 20 thing and then that just rapidly expanded…

ALEC HOGG: Two and 20?

ANTONY BALL: Two and 20 – 2% for management fee and 20% incentive fees. And then that rapidly went into something where you’ve got people raising $15bn to $20bn now with substantially the same sort of economics on that. So it’s been a huge growth sector and obviously wouldn’t have predicted that at the time, but very fortunate to have been on the front of that from a South African point of view.

ALEC HOGG: And then listing your company – first of all it was Capital Partners, then you became Brait. You were listed at the time – it was interesting to put yourself into the public arena when you are making very private investments.

ANTONY BALL: Interesting indeed. We cast our minds back over that decision many times. I think that to be candid about it, you may recall at the time that the financial services in South Africa were going through a massive boom. Anything that looked like it was going to be the next Investec or RMB came onto the stock exchange with a great valuation. That was certainly part of what got us to where we were. But as I often remind people, it was about two weeks later there was a terrible cold shower because we had that Russian crisis and all the consequences that went with that, so we had about two or three weeks of being highly valued and listed, and then very quickly we had to adjust our business model to something that was going to work and I feel that we did more for the business over time and turned it into something that did work really well and which fitted in with the themes of the time. But ja, the listing has at times been both a positive and a negative.

ALEC HOGG: When you stepped down last year, it was to effect the appointment as the CEO of the company of, I guess, your protégé John Gnodde was with you back at Capital Partners back in 1995 which is interesting that the two of you have walked such a long road together.

ANTONY BALL: Indeed – John joined us I think it was early 1995 and worked closely with other members of the team for a long period of time. I think that as John has expressed it pretty well in the various public forums is that this is more of an evolution of the private equity business. And I think all of us had come to the conclusion that the industry had grown very rapidly, it had done very well, but we wanted to find a way of stripping out some of the inefficiencies and frankly, one of the principle inefficiencies you have in modern day private equity in South Africa is what I call embedded cost of raising this money. You need to have a very talented deal team which we have in Brait, led by John that’s spent half its time running around the world raising money instead of doing what they do best, which is making investments and managing portfolio companies. And that cost had got higher because we have all of what I call the South African footnotes that we need to explain when we raise our money internationally – the travel and dislocation that goes with being away – and harder and harder to raise that money. So we felt that the easiest way is to raise it from the South African investors, give the South African investors the benefit of the return and then adjust the business model to make it much simpler. So we didn’t have to have all of the engineering that was required to meet the demanding needs of international investors.

ALEC HOGG: The entry of Christo Wiese into the Brait fold at that point in time must have played some kind of role.

ANTONY BALL: Absolutely, I think that Pepkor was an investment that we made in our third fund – it was the best investment we’ve ever made – great investment. I think John and Christo have had a very good partnership and relationship and I think Christo got progressively interested in what was going on at Brait and it definitely was a factor. So as often with these deals, there’s never one thing that gets you there – it’s a cocktail of circumstances and factors and certainly Christo’s interest and involvement has been very material in taking Brait to this next level.

ALEC HOGG: Do you see much of him?

ANTONY BALL: I’m on the board – I see him at board meetings and I’m on the South African board – we have a meeting every month and then the holding company board which meets every quarter. But outside of that no, I think Christo and John work together really well and I’m anxious not to get in the way of how things are operating there. Brait is going very, very well, so ja, I see him at board meetings and I think he’s added enormously to what we have at Brait.

ALEC HOGG: It’s just over a year now since that happened and you’d been running the company for many years before that – do you feel any sense of loss?

ANTONY BALL: Well there’s certainly adjustment – and I’ve seen from some of these interviews you’ve had with people that have moved into non-executive roles now, fortunately I’ve had non-executive experience from what I’ve done every day in my portfolio companies, but nothing quite prepares you for that change. It is a big, big change – it really is a change from having your hands on the levers and to hands off the levers. But in my case I’m hugely privileged in that John I think is a terrific leader and he’s trained himself to be that over many years. A great team of people around him and people that sort of understand, and understand how they’re going to respond to certain situations and circumstances and frankly, I’m not needed like I was needed. That’s all been actually quite easy for me, so I’m delighted with how it’s gone. I keep involvement, I keep the relationships with the people that are in the company, but the adjustment has also had its challenges, as these things do.

ALEC HOGG: Because it has been an interesting company. Often you got into news sometimes for the wrong reasons – Mark Barnes in 2000 when he was with you, then John Coulter came along in 2006 – didn’t last very long – he was from JP Morgan – he seems to have disappeared. Barnes is still of course very much in the forefront. And then your good friend, Thierry Dalais- the two of you seemed to have been joined at the hip and then he also departed…

ANTONY BALL: Ja, look you can get quite reflective on these things when you’ve got a bit of time to sit back and I have to say with hindsight we could have charted a smoother path as far as some of these relationships were concerned. But having said that, I feel my personal relationship with all those mentioned, is very good. We see each other reasonably frequently and follow each other’s progress and support each other where we can. And I think each of those people would have brought something quite special to what Brait is today. There’s a little bit of Mark and certainly a lot of Thierry and a little bit of John Coulter in what we have at Brait. So I think they’ve all left something – something important. But I suppose ones also got to remind oneself that the deal business is quite a feisty thing and we’ve been in that for a long time. From the start of Brait until this day, I think we’ve done about 95 different transactions – thats lots of transactions for a small town and you end up bumping into lots of people, meeting some great people, meeting some not so great people and in the course of that I think you are going to have a few bumps. It’s just a natural thing that happens in this sort of environment.

ALEC HOGG: Ninety five transactions and yet only one of them you’ve stuck with – Net1, Serge Belamant’s company. Certainly that’s the one that I know you’re a director of. Why was it – what was special about that business that kept you involved?

ANTONY BALL: Well I could talk to you for hours about Net1, I won’t bore you with all the details there, but essentially I met up with Serge exactly nine years ago and from then we’ve had a nice long relationship together. It hasn’t always been plain sailing, I’m sure he will tell you, but I think that Brait was quite material in taking that company to Nasdaq and getting it onto the exchange there and in doing some of the restructuring and organisation. It was a very successful investment for Brait and we did very well out of it…

ALEC HOGG: It was an incredible investment…


ALEC HOGG: Wasn’t it a multiple of the local value when it in fact did list on Nasdaq?

ANTONY BALL: The gory numbers there – I think that we all invested at about $3/share at the time and it came on at $24 when it listed and it went up to $30 something… We didn’t sell all of them at those sorts of levels, but it was a good for us and when it came time for us to go, the last chunk of our shares were actually bought by Net1 – they did a buyback and Serge asked me to stay on. I said sure I’d be very happy to carry on and help which I did, and I thought every year it would be an annual thing and every year it’s got a bit longer and frankly I’ve enjoyed it. It’s been more of a personal thing than a Brait thing – after Brait’s exit there was no real need for me to stay on other than in all of these circumstances where we do move on, we’re very respectful of not all bolting when we sell our shares. So it’s quite common for us to stay on for a short period of time after selling down, and in this case that’s just extended.

ALEC HOGG: How else are you keeping yourself busy?

ANTONY BALL: Let me say first of all that my period of relative idleness started in about July last year, so I think 12 July was when the transaction with Brait became effective and so I took a bit of time off and I’ve tried to be very thoughtful about what all my new involvements are. First and foremost I keep an involvement with Brait. I’ve kept a substantial… all of my shareholding there. I’m a great believer in what the business is doing so I keep relatively close to what happens there. And then as I said I’ve got involved on the Rhodes Trust Investment Committee. I’ve kept my involvement in Net1. I’ve started a new business in the financial planning area. I have an involvement in an institution called the CDE which is a think tank around job creation and education and I’ve got a couple of other ideas that I’m working on that are reasonably developed. As I explain to people it’s sometimes like throwing a whole lot of balls up and see which ones start coming down. But I’ve been very deliberate about trying to do things where I feel I can give a bit and get a bit. So in a sense of… not financial terms so much, as to from a learning and development point of view. And one of the other things I’ve done is I’ve gone onto the board of an outfit called Harith – it’s a development finance institution on the continent that’s driven from South Africa and the Brait chairman Jabu Moleketi chairs it and he’s asked me to come onto the board of it and in that respect what I feel I’ll learn amongst other things will be about the continent and what’s happening elsewhere on a pan-African basis. And what I’ll be able to give is that this institution will be raising money internationally and hopefully I can add some value to that process as well. So I’m trying to do things where I’ll grow and develop and learn something and maybe give something from the incredible opportunities I’ve had historically to learn and back relationships and understand certain things about how this place works.

ALEC HOGG: Very different to the popular perception of a business leader in South Africa. You’re only 53 so in many ways – or I hope you’re still 53…


ALEC HOGG: In many ways you should only be hitting your straps now if you were doing a business career, but you seem to have taken perhaps a more balanced approach to life.

ANTONY BALL: Well slightly more balanced. Unfortunately one of my great failings, and I have a few of them is that I only know how to do things at one pace, and that’s flat out and I’ve been flat out up until 52, but properly flat out from the time that I can remember. So this is going to be a slight slowing down. Maybe it’s from 150% to 100% and what I’d like to be able to do is have a second career. I think I’m still young enough to have one. So this is not about retiring, it’s about trying to do a few things that are different and maybe more suited to my skill set than trying to run something.

ALEC HOGG: Do you mind… Alan Knott Craig took three years off and then came back with a bang with Cell-C, might we hear Antony Ball doing something similar?

ANTONY BALL: Very unlikely. I’ve been very thoughtful… I regarded this as a huge blessing to have this opportunity when I was 52, now 53. So it’s a precious thing – I want to make sure that I use the opportunity properly so I’m being very thoughtful about each and every new commitment that I take on, and I’m definitely not up for another full-on executive role. That I know – I’ve got a good sense of what my strengths are and what they’re not and being a full-blooded CEO is not my thing. So I won’t be doing that, but I do expect to keep myself busy and to do some very interesting things and hopefully have a second career that’s a bit different to the first one.

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