Main takeaway? Don’t live a life other people want you to live and don’t feel guilty about things you don’t do.
JS: Your childhood was filled with various obstacles. At just 12, you and your family found yourself in a refugee camp at Traiskirchen, as you were running away from Communist Poland. Later on, you ended up in South Africa. How did all the different challenges you faced as a child influence your decisions later in life?
MW: What happens to you in your teenage years certainly drives the decisions that you make in the future. When we arrived in South Africa, we didn’t speak English, we didn’t have any money, and we had to rebuild our lives. And our parents were so busy that they could not pay that much attention to my siblings and me. All those experiences translated into a non-linear childhood. My journey was unstable and it wasn’t the most pleasant time of my life.
A few years ago, I was asked to visit my high school and be the keynote speaker at the valedictorian service. I remember I prepared two openings for the speech. The first one was something like: “Thanks to this school I am what I am because the school has given me so much.” The other opening was: “Those were the worst years of my life.” Up until I stood on that stage, I didn’t know which opening I was going to go with. And when I stood there, I decided to go with the truth. I said that they were the worst years of my life, but what they taught me was independence at a very young age and self-sufficiency. Because I had to take care of myself much earlier than a child would usually be expected to, I became more innovative and industrious.
When I wanted to go to university, I needed financial support and had to find a company that would give me a bursary. The only companies that offered financial help to students in South Africa with my skills were insurance companies. So I applied for and was awarded a bursary to study actuarial science even though I did not know what that meant. Importantly, they paid for everything. As soon as started working as an actuary I realized that I was not cut out to be an actuary.
So, I quickly decided to make a career change. I persuaded the company I worked for to move me to the investments department. Within a year, however, I was invited to a dinner by my husband-to-be, Simon Peile, with his boss, the CEO of South Africa’s largest pensions consulting firm, Alexander Forbes. By the end of the dinner, I had persuaded him to offer me a job and pay off my bursary debt.
What skills did you use to convince him to do that?
Good sales skills. I made him believe that hiring me was actually his idea. But it wasn’t all plain sailing. When I joined the company, I was told: “Sorry, but we don’t actually have anything for you to do. So how about starting a new division for us? We would like to focus on investment consulting and retirement funds. We’re not doing it currently and we don’t know what that should look like. Why don’t you develop it as a service and then find some clients willing to pay for it?” My first thoughts were: I’m 25 years old. I don’t have any background in consulting. How am I supposed to start a new division? But coming back to my non-linear childhood, I knew I had to be self-sufficient. And so I agreed. Within a year we had a new division and large corporate clients who listened to me when I advised them how to invest their retirement fund monies. To this day I think that the very concept of a 25-year-old woman standing there and telling grown men how to invest billions of rands was absurd.
Did you feel intimidated?
No. I can’t say that I’ve ever felt particularly intimidated, especially as I had to fight for everything as a child. It was just an absurd concept to be so young and to be advising experienced people what to do.
But what helped me was, actually, my training in actuarial science. I had hated it. It was boring. When I was studying it, I was surrounded by mathematical geniuses and I definitely wasn’t a genius. But there were only a few hundred actuaries in South Africa, and I was only the third woman to qualify. And this was regarded as the hardest qualification that you could get in finance. So that’s why the grown men were listening to me. Not because I was a 25-year-old. It was because I was an actuary. And that really mattered.
And how did you find yourself managing Coronation Fund Managers just a few years later?
One day five guys who had not long before started an investment business called Coronation approached me, asking me to help manage their company. They were investment experts used to managing money, but they didn’t know much about administration, marketing and all the other aspects that go into running a successful business. They approached me and said: “Magda, we can’t afford to pay you what you’re earning now. We can only pay you one-third of your current salary, but, you’ve got complete freedom. We’ll just manage the money and you run the business side” I thought to myself: what a fantastic opportunity as if we grew the business and I could share in its profits I would make a lot more money than I was earning as a salary. But it meant taking a risk.
So for six and a half years, I ran the institutional side of Coronation Fund Managers, now one of the largest asset managers in South Africa. But it was not perfect. After six years, when we were employing about 60 people and managing a lot of money, I learned the difference between being an owner and an employee. The person who actually owned the company decided to take it public and list it on the Johannesburg Stock Exchange. Initially, we thought that was exciting and we would all be able to buy shares in the business, but unfortunately, I was told that this would not happen. In fact, the precise words were: “You are not an owner. You are a well-paid employee.” And so I resigned on the spot.
I remember calling my husband who was on his way overseas and I said: “Honey, I think I just quit my job”. He turned around and literally the very next day we were at a lawyer’s office registering our own company. A couple of people that had worked for me at Coronation offered to leave and join me and work for free until I could pay them. That sounded great in theory, but I was only 32 years old. I still felt I was too young to start my own business and make a success of it.
Fortunately, within a few months, I got this phone call from a friend who invited me to lunch. At the lunch, I met a gentleman by the name of Mzi Khumalo. He opened the conversation by saying: “Hi Magda. You’ve got a business. I’ve got a business. Let’s make a deal.”
Mzi Khumalo used to be one of the most senior people in The African National Congress (ANC), the Republic of South Africa’s governing political party. Before apartheid was abolished he was the head of ANC’s military wing and had spent 13 years on Robben Island in the political prison with Nelson Mandela. The moment he left Robben Island, he decided he was not going to continue in politics but was going to go into business. And very quickly he made quite a lot of money. But he invested a big chunk of it in what turned out to be a bankrupt asset management company called African Harvest. So when he said to me: “Magda, you’ve got a business”, I knew I didn’t have a business, but I thought he had one, which he didn’t.
He convinced me to team up with him by offering me a 10-percent stake in the company. When I arrived at the office on my very first day, there was a white envelope on the desk. It was the due diligence report he commissioned on the company after he bought it, which basically listed the litany of operational and tax issues. I remember phoning him and telling him: “Mzi what is this report?” He laughed and said: “Magda, it’s not that I didn’t tell you the truth. It’s just that you really didn’t ask the right questions.”
Again I suspect most people would have looked at the situation and said: “Cheers, I’m out of here!” I, on the other hand, looked at it and said: “OK, it’s a challenge, but we need to turn this company around”. It took me about three years to rebuild African Harvest. After three years the company was worth 300 million rand and I had borrowed money to increase my shareholding.
However, Mzi called me one day and told me to sell the business. Halfway through the sale, my CFO asked me “What are we all doing next?” When I asked who “we” were, she gave me a list of people who did not want to be “sold” and wanted to join me in my next venture. I remember thinking: “Wait, what venture? I don’t have the next venture!”
So again, it would have been so convenient for me just to take the money I had made and step away, as opposed to the crazy process of launching a new venture, restructuring the sale transaction, applying for licenses, and so on. And that’s exactly where the non-linear experiences from my childhood helped me.
The linear thinking would be: “I’m taking my money, guys. I love you dearly, but you’ve got a new boss.” Instead, I started Sygnia, the company I run today.
And I’ve read that Sygnia grew in a decade from about 2 billion rand in assets under management to about 160?
Actually 240 billion rand.
From what you’ve just said, it’s essential to take risks and adapt to change as quickly as possible.
Yes, but you also need a healthy dose of good luck!
Never underestimate the role that luck plays. There are many people who start companies, who take risks, who work hard and are still not successful. So, unfortunately, luck is that magic ingredient, which I think makes the difference between people who are successful and people who are not. And that is completely beyond your control.
I came today to this conference* specifically with the thought: maybe I will be able to interview you on the spot. I had no idea if this would work, but I decided to make my way here. So maybe this luck is not so entirely beyond our control, but it’s just using opportunities that you get?
Of course, you need to be clever in terms of the decisions that you make. When we started Sygnia, for instance, we didn’t have a business plan, so I sat everyone down and asked: What’s the business model? What do we all have in common? We had one guy who was incredible at coding, another one in operations. I also had some administration people. We brainstormed: What’s our edge? What’s different about us? And it was surprising. We came up with this idea that we were going to offer investment and savings products at the lowest possible cost. So we decided to undercut our competition by not just 10 percent, but by 80 percent. At an 80 percent discount, we knew we couldn’t be ignored. And that was the magic ingredient that made the difference. But we still needed luck. We were lucky to have a team of people with a fantastic skillset. If we didn’t have a great coder, we couldn’t have developed the technology and the systems that we developed. We also wouldn’t have landed our first two big clients who didn’t care about our investment expertise, but who wanted our systems and administration capabilities.
Sygnia is right now a large, publicly listed company. What are the significant challenges that you currently face?
Well, to be honest, it’s become a bit boring. At heart, I’m an entrepreneur, rather than a manager of large businesses. That is why I’ve just started a new company in London and I am trying to transition out of the day-to-day management of Sygnia.
Of course, I’m still the majority shareholder in Sygnia and that will stay in place. But over the past few years, I’ve bought back enough shares to give to my key management staff, so they all feel like owners. I never want them to feel like I did at Coronation.
Now I’m focusing on developing the new venture and funds which focus on technology and impact investing. There’s this whole very exciting world of investing for the good of humanity. So, we basically invest in companies that can potentially change the world for the better, mostly in the healthcare industry. I love it.
In the past, you were involved in fighting corruption in South Africa. You don’t want to do that anymore?
I still am. However, I need a counterbalance. I don’t want to do any more forensic investigations, trying to figure out how the money has been stolen from South Africa by multi-national companies. When I arrived in London, and I said to myself: OK, now I need to make a positive contribution in a different way.
There are so many things that you’re doing and it does sound exhausting. You also have two sons. Do you think you have a work-life balance?
No. You just can’t have it all. Just think about it: can you really shop, clean, cook, take care of the children, take them to school, work full-time and excel and be available to clients and colleagues 24/7 and still go to the gym? It’s ridiculous.
So how to manage your life in the sense that you feel like you have your life in order?
There isn’t a single answer; different women will come up with different solutions.
You need to prioritize and discard things that are not a priority and not feel guilty about the fact that you don’t do them. And there’s a different scorecard for different women. It’s a very personal thing. What is a priority to you? Once you answer that question choose the things that you can outsource and just outsource them!
So, personally, I wanted to work and achieve career-wise. So I couldn’t take my children to school – my husband did. I wasn’t there for 10:00 a.m. picnics on the lawn. I couldn’t prepare their lunch. But I told them, when you are older, I want to be the kind of mother that you come to with all your life problems.
I believe that you need to decide what you want from life and not feel guilty, because, in the end, you’ve only got one life. Don’t live a life that other people expect you to live.
For example, I don’t cook. My husband does all the cooking. He had to teach himself!
Do you share your responsibilities and chores with your husband?
Absolutely. He was a key member of the Sygnia team, but when he could, he took the children to school and made sure that he was home in the evenings so that I could work late if I needed to. These days he takes care of all home issues and makes sure the shopping is done. Of course, this doesn’t mean that sometimes there isn’t an empty fridge.
Interview by Joanna Socha
Edited by: Diana Asatryan, Phyllis Budka
* Joanna Socha conducted the interview during a conference briefing called ”Warsaw-Davos. New Capitalism. Will it be a recipe for hard times?” organized by Center for International Relations in Poland, ThinkTank and City of Warsaw.
All photos of Magda Wierzycka were provided by Sygnia