Koos Bekker this week became Ernst & Young and Rand Merchant Bank's ninth entrepreneur of the year and will soon be competing for last years winner from South Africa, Bill Lynch’s World Entrepreneur of the Year title.

Bill last year did South African entrepreneurs proud by winning the title and we will all be rooting for Koos Bekker to take the honours this year. Lets face it, after the dismal performances of the Springbok Rugby team in Ireland and England, we can all do with a bit of good news.

Colleen Naudé reports

"THE MOST EXCITING PHASE of a project for me is the very beginning - when the risk is at its greatest.
"If you put your head on a block and you see the axe being raised it does wonders for your levels of concentration. The bigger and older the unit, the more bureaucracy you'll find creeping through its corridors," says Koos Bekker, who won the South African leg of the World Entrepreneur awards run by Ernst & Young, in association with the Rand Merchant Bank.

That's why it's no surprise that becoming MD of the established Naspers (Finweek's parent) wasn't part of Bekker's business plan. In fact, when he was a student in the 1970s he'd probably not have wanted to work for Naspers, because he was "slightly left" of the then government, which the company had fairly close ties with at the time.

That's why it's understandable that under Bekker's leadership Naspers still comes up with entrepreneurial steps - also in the two years since first chosen as a finalist in the World Entrepreneur competition. Such as the acquisition earlier this year of 30% of Abril, the South American publisher of books and magazines.

Abril titles, among others, include Veja, a strange cross between You and The Economist, which is the fourth-largest weekly in the world.

Knowing cultures

Geographically, Naspers focuses on Brazil, Russia, India, China and sub-Saharan Africa - the so-called Bricsa countries.

"These countries have a lot in common: they have good infrastructure in the cities but low levels outside them. We understand economies where not everyone has a credit card, or even electricity," Bekker says, also pointing out that international expansion soon teaches you how vastly cultures differ.

"For example, if you invite a new business contact in Holland to your house for a meal, he could easily be horrified and turn you down, saying he won't allow himself to be bribed. On the other hand, if you think you'll get an order in China without first sharing five meals, you've clearly never done business there.

"One culture likes contracts and efficiency; in the other, personal relationships count for much more than what's written on a piece of paper."

Bekker began learning about other cultures shortly after his initial studies in SA when he registered for an MBA in the US. After a BA law and an Honours in literature at the University of Stellenbosch, where he was the editor of the student paper Die Matie, he studied for an LLB at the University of the Witwatersrand. However, the legal profession left him disillusioned.

To the dismay of his family, he resigned and joined an advertising agency to learn about market research. But that experience opened his eyes to the excitement of the business world.

How M-Net began

In 1982 he went to Columbia University in New York. "A wonderful place that could draw lecturers from Wall Street and Madison Avenue every evening.

" That was the beginning of pay TV in the US and Bekker collected every report on that subject for his thesis on a pay TV model for SA.

Two years later with two colleagues - Cobus Stofberg and Jac van der Merwe - he approached Naspers chairperson Ton Vosloo to ask whether he'd be interested in the concept of pay TV. Eventually, a consortium of all the publishers of dailies at the time was formed to finance it.

But the start of M-Net in September 1986 was catastrophic. "We were only in our thirties. Most of us didn't know anything about TV and none of us knew anything about business. Hotels and apartment complexes, the target market for the first phase, weren't interested. Nor were the advertisers. Six months later the company lost R3,5m a month on a turnover of R500 000."

Then the first decoders for private houses started rolling off the production line and the market took off. Two years later, M-Net broke even on a monthly basis and has been profitable since.

M-Net led to the formation of several companies. In 1990, MultiChoice was born out of it and today it provides pay TV channels to 50 countries throughout Africa. The largest markets are in Nigeria and Angola.

MIH, the holding company with interests in the subscription TV industry, wasn't allowed to take rand out of SA to grow overseas and, with Richemont, it formed the company Nethold in Europe in the Nineties and several pay TV assets were built up there.

Raw South Africans doing global business

Nethold was later sold at a good profit to Canal Plus in France. And by looking at how Richemont did things, a bunch of raw South Africans began learning how to do business internationally. MIH now runs the pay TV platform in Greece and Cyprus.

MIH's technology company - Irdeto - is based in the Netherlands and supplies the basis for encryption to more pay TV operators worldwide than any other company.

Besides pay TV, MultiChoice also conducted the spadework for the introduction of cellphones into SA. "We presented a business plan to the full board of Telkom's predecessor. They thought it was crazy to hope that 300 000 people would buy cellphones."

However, MultiChoice went ahead and developed the project. After delays, Government and the ANC decided jointly that two licences should be issued: one to MultiChoice and its partners Transnet and Nail (MTN), and one to Telkom and associates (Vodacom).

"In retrospect, our figures were as ridiculous as Telkom's. Currently, more than 20m people use cellphones in SA."

In 1997, Bekker returned to SA from MIH in the Netherlands to head Naspers. His contract contains the interesting stipulation that he receives generous allocations of shares but no salary, company car, bonus or pension.

Rolling out internet services

When it became clear that the internet was going to play a major role in SA's economy, M-Web was formed. The expansion of internet services to the East followed.

The first, a service provider in China, failed hopelessly. "We flew in a few Western managers to teach the Chinese about the internet. Then we found out that they work harder and were technologically more advanced than our team.

We lost a vast amount of money - and that's the best way to find out you're on the wrong track."

The lessons learnt led to the success of an investment in Tencent, of which the QQ service in China provides instant messages, emails, games and other services to more than 100m people.

It also owns the fifth largest portal in the world. Tencent now has a market capitalisation of more than US$4bn.

It's listed on the Hong Kong Stock Exchange and, with 37%, MIH is its largest single shareholder.

A recent addition was an interest in Tixa, an engine that places advertisements on the Internet in China as well as in Beijing Youth Daily, the second biggest newspaper in the city.

In India the group recently launched an internet portal to offer exciting services to young people.

Entriq, MIH's company in San Diego, California, is currently conducting pioneering work in the encryption and management of broadband content on the Internet.

The broadband broadcasts that Americans watched during the Olympic Games on NBC's website were administered by Entriq. So too the rugby that people watch on their computers in 30 countries, as well as the Wimbledon tennis championships.

"Entrepreneurs must often take great risks to make money. But they aren't gamblers - because they hate losing," Bekker says.

"I find the media world exciting because it moves so rapidly and involves so many disciplines - technology, social trends, the economy, poker and a bit of human knowledge. As soon as you think you know something, it's already outdated."

Source: Finweek