Hogg closes loop on Moneyweb adventure
Alec Hogg, founder and former CEO of Alt-X listed media group Moneyweb, has again spoken out about his sudden resignation from the the company in October, but this time in a more tempered voice.
In an interview with Bizcommunity, Hogg talks about an opportunity to partner Summit TV, having his business taken away from him, and his intended one year sabbatical to think about the turning tide of technology in South Africa.
BusinessTech provides an excerpt of the interview which was published on Alec Hogg’s blog:
Bizcommunity: Because Moneyweb has become such an established, trusted brand, I think many people forget that when you started it (in 1997), people thought you were mad – that a business-news website was never going to last. You guys really were pioneers?
Alec Hogg: You know, looking back, it’s so interesting to me now that we were doing stuff that was way ahead of its time – and not because it was the internet but because of the way the business was structured. It was a collegial effort. Everybody got paid the same… Everybody was in the same boat.
In hindsight, something started going wrong when we listed on the JSE (in July 1999). On the one hand, it was good because we raised R10 million and, as a result, we were always going to survive. But on the other hand, it brought completely different priorities into play. We saw that it wasn’t too long before we started differentiating salaries… Then, for instance, we started hiring sales people on commission – not on salaries (as was the case previously)… We were told when we listed that we had to hire a financial director who was a chartered accountant. Then we had to bring in auditors…
If it was today, I would probably go to a private investor to raise money and say: “Come along for the ride. This is why we’re going to conquer the world”. To make it worse we listed right near the top of the market (of the dotcom boom). The share price had a couple of good days but then it started declining…
Bizcommunity: Did you ever think of delisting?
Hogg: We always thought about it but the funny thing was that the business itself was actually growing and developing really nicely… A pure capitalist would say that was the time to buy it back from the market but, for me, I felt that we had about 1,000 subscribers at Moneyweb who had bought in when we listed. And I still felt: “The business is so much better today than it was when we listed – even though the share price is not reflecting it”. So it was always about: “We’re all going to enjoy the benefits (of the growing business along with the investors)… In hindsight, maybe I should have been more of a capitalist. There are different motivations for different people.
Bizcommunity: I know you’ve got a year’s restraint of trade but is it time to give up the media business?
Hogg: Within a week (of leaving) I was approached by Vernon Matzopoulos (CEO of BDFM’s Summit TV) – who’s a bit of a kindred spirit because he’s also entrepreneurial. But when I then approached Moneyweb to say: “What’s the story if I want to do this with Summit?” they said no (because television will compete with Moneyweb’s YouTube offering).
Bizcommunity: The restraint of trade seems very onerous because now’s the time for you to start something new, surely?
Hogg: I’m a great believer in Malcolm Gladwell’s rule he explained inOutliers. We all know some things that have taken 10,000 hours to master. I could go into PR or something else – those kind of opportunities have come up. But you know, I’ve sat for the past 15 years trying to understand how our industry is transforming and changing into something very different.
And now, I’ve got a year to almost do a Koos Bekker – to drop everything and to play, get all my ducks in a row so that, come the end of next year, I can see where opportunity lies.
Technology is transforming our industry radically and, when you’re in it, it’s very hard to see. When you’re outside, you can quite quickly get a grasp of the threats to the old system – and (of the opportunities) in the disruption… In South Africa we haven’t really experienced the massive changes that have happened elsewhere in the world. The tide is coming. You can hold it back for a period but you can’t hold it back for ever. I’ve got a year to think about this.
Bizcommunity: Also, you love being a journalist. You love asking questions. That would be very hard to give up.
Hogg: Ja, this is my industry. It’s the thing that I know. It’s the thing that I’ve done for 30 years. I didn’t fall into it by accident. I knew what I wanted to do. But there’s a lot wrong with the industry. That brings opportunity.
I don’t think internationally – let alone in South Africa – we can really see how the business is going to change. I don’t know. The only way to learn about it is by actually trying to find out more and by listening… A part of me is saying: “No, I’m going to fight this (losing Moneyweb)”… But that’s a very immature and emotional response to what happened.
I think anyone who has built a business and sweated the way I did – and was so heavily invested emotionally and financially and every other way – if you have it taken away from you – and that’s what’s happened with Moneyweb; there’s no other way to describe it – would understand this.
I actually encouraged Caxton to increase their shareholding. My ex-wife sold them 20-odd percent but it was my decision as to where those shares went. And I encouraged them to take it so that they would build up a bigger stake because I was under the impression that we could be partners. But corporates don’t think like partners. It’s not a case of them being bad people. It’s just the way of the world.
Corporates have a different mindset – a different culture – to the way that the entrepreneur thinks. An entrepreneur is somebody who wants to build something because they think that they can do it better. They don’t really want to be told what to do.
A corporate on the other hand is there to live off momentum and take the low-risk option. It has a relationship with its employees that is: “We will give you a job and we will pay you well but you do what we say you must do”. So we had this clash of cultures that made it inevitable that at some point Caxton and I were going to fall out although (Caxton CEO) Terry Moolman tried his best to make me a part of everything that they did…
Bizcommunity: Is that what you meant when you left Moneyweb and said you couldn’t continue there because you and Caxton had different values?
Hogg: In hindsight, I can see that Caxton could never have operated in a way that would have made me happy – and vice versa. So are they wrong and am I right? Of course not. We just have different values…
Alec Hogg: Why I resigned – and the next moves
Hogg steps down from ailing Moneyweb
Loading ...