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A Serious Investment For A Funny Man

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How do you keep the crowd interested in your comedy?

Be honest, because they need to realize you are one of them.

What is your business strategy?

You need to be open to what is going on in the industry. There was a time where we were able to plan a year in advance, but we can’t do that anymore. Social media platforms are evolving so fast. You can’t drop the same images and messages on Twitter, Facebook and Instagram. You have got to do it differently… So stay current and on top of things. It is also more than just about the technology; there are networking opportunities springing up.

What is your investment philosophy?

I am a conservative investor. I go for short-term investments rather than long-term investments. I would like to keep it to the medium range of risk.

Financial discipline means…?

Knowing when to say no, no matter how good it feels.

How do you remain financially disciplined?

I struggle a lot.

How have you diversified your investments?

I own a couple of classic cars. I also have a couple of properties.

Your most recent acquisition?

I bought a piece of property on Long Street, Cape Town.

You most regrettable financial blunder since you entered the industry?

Starting the comedy club! It was difficult making a concept like a comedy club work in a conservative space five years ago when I started.

However, it became the best decision I ever made. At the time, it was a huge investment of energy and time to get it started. On one or two occasions, I remember thinking this was too hard. It has been a very bitter-sweet thing but in the end, the advantages are huge and the disadvantages just as staggering…The theory of business is basically failure till you reach the point of success. But failure is a very important part of success. You can’t have the one without the other.

Kurt Schoonraad. Photo by Casey Bertie

How do you decide your fee?

My personal fee is affordable. I think it is important to stay within range. It is very easy to price yourself out of the [market]. We need to understand that the universe has not made all comedians equal. My fee is about R35,000 ($2,600) for a 45 minute-to-an hour set.

How much is it to start a comedy club and what does it entail?

More money than you know how to come up with but you figure it out. It is [just] one of those things. There was no comedy club in Cape Town yet there was one in Johannesburg. It is a no-brainer that comedy needed a home in Cape Town…I had to sell one or two classic cars and my partner also invested heavily in my business. It is at the V&A Waterfront [in Cape Town] so the rent is extremely high. It was worth it because at least 30 percent of our audience is not from Africa. We would have not been able to call on that market had we not been situated where we are.

How do you strike a balance between being an entrepreneur and a comedian?

This must be the thing I am struggling with the most. By just opening up the comedy club, people assumed you have taken up the other side. In the early stages, I found out that there are very huge demands on the business side of things. I work during the day and I perform at night.

Money or fame?

Most definitely, fame.

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With “Room2Run,” AfDB Launches Securitisation Market For Multilateral Development Bank Sector

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➢ WITH “ROOM2RUN,” AfDB LAUNCHES SECURITIZATION MARKET FOR MULTILATERAL
DEVELOPMENT BANK SECTOR
➢ TRANSACTION IS IN DIRECT RESPONSE TO G20 ACTION PLAN FOR MDB BALANCE SHEET OPTIMIZATION
➢ AfDB COMMITS TO REINVEST FREED UP CAPITAL INTO NEW AFRICAN INFRASTRUCTURE
LENDING, MAKING ROOM2RUN ONE OF THE LARGEST IMPACT INVESTMENTS EVER
➢ TRANSACTION IS SUPPORTED BY NEW EUROPEAN UNION GUARANTEE TOOL (EUROPEAN FUND FOR SUSTAINABLE DEVELOPMENT)

OTTAWA, Canada, 18 September 2018 — The African Development Bank (AfDB), the European Commission, Mariner Investment Group, LLC (Mariner), Africa50, and Mizuho International plc today announce the pricing of Room2Run, a US $1 billion synthetic securitization corresponding to a portfolio of seasoned pan-African credit risk. Room2Run is the first-ever portfolio synthetic securitization between a Multi-Lateral Development Bank (MDB) and private sector investors, pioneering the use of securitization and credit risk transfer technology to a new and previously unexplored segment of the financial markets.

Structured as a synthetic securitization by Mizuho International, Room2Run transfers the mezzanine credit risk on a portfolio of approximately 50 loans from among the African Development Bank’s nonsovereign lending book, including power, transportation, financial sector, and manufacturing assets. The portfolio spans the African continent, with exposure to borrowers in North Africa, West Africa, Central Africa, East Africa, and Southern Africa. Mariner, the global alternative asset manager and a majority owned subsidiary of ORIX USA, is the lead investor in the transaction through its International Infrastructure Finance Company II fund (“IIFC II”). Africa50, the pan-African infrastructure investment platform, is investing alongside Mariner in the private sector tranche. Additional credit protection is being provided by the European Commission’s European Fund for Sustainable Development in the form of a senior mezzanine guarantee.

“Room2Run gives us fresh resources to invest in the projects Africans need most,” said Akinwumi Adesina, President of the African Development Bank Group. “Africa has the most promise, the greatest natural resources, and the world’s youngest population. But we also have the world’s most persistent infrastructure deficits. The African Development Bank has the strategy to address these infrastructure finance gaps—and Room2Run gives us the capacity to make it happen.”

Structured as an impact investment, Room2Run is designed to enable the African Development Bank to increase lending in support of its mission to spur sustainable economic development and social progress. In connection with Room2Run, AfDB has committed to redeploy the freed-up capital into renewable energy projects in Sub-Saharan Africa, including projects in low income and fragile countries.

“On the Impact scale, Room2Run is off the charts,” said Dr. Andrew Hohns, Lead Portfolio Manager and head of the Mariner Infrastructure Investment Management team. “Room2Run answers the call of the G20 for private sector participants to step in and facilitate development finance, providing a template for attracting significant private sector capital into urgently needed projects in developing economies.”

Raza Hasnani, Head of Infrastructure Investment at Africa50 commented, “Room2Run provides an innovative and commercially viable solution to the African Development Bank’s risk management and lending objectives, while paving the way for commercial investors to support and benefit from the growth of infrastructure on the continent. Africa50 is very pleased to participate in this landmark transaction, which is in line with our mandate to drive increased investment in infrastructure in Africa, and to create pathways for long-term institutional capital to flow into this space.”

Room2Run enjoys the support and participation of the European Commission with an investment from the European Fund for Sustainable Development, in the form of a senior mezzanine guarantee. “Only a few days after announcing our renewed Alliance with Africa for sustainable investments and jobs, I am very happy to announce that we are, together with the African Development Bank, launching Room2Run,” commented Neven Mimica, the European Commissioner for International Cooperation and Development. “This initiative is a perfect example of what we are doing to support investments in African low income and fragile countries through the External Investment Plan. Through Room2Run we provide
an additional protection to investments in the field of renewable energy. Through our Guarantee, investments under Room2Run will translate into extending supply to many people currently without electricity whilst creating much-needed new jobs.”

Room2Run also directly responds to calls by the G20 that MDBs use their existing resources to full capacity, as articulated in the 2015 G20 MDB Action Plan to Optimize Balance Sheets, as well as calls for greater MDB efforts to crowd-in private investment. The G20 has called on MDBs to share risk in their non-sovereign operations with private investors, including through structured finance, mezzanine financing, credit guarantee programs, and hedging structures.

The Government of Canada has been a global leader in advocating for MDBs to use their existing resources more efficiently and to mobilize private capital for global development. The goal of the G20 MDB Action Plan to Optimize Balance Sheets is to catalyze significant new development financing from the MDBs throughout the real economy in key development regions. “Attracting more private capital into global development efforts is critical to building economies that work for more and more people around the world,” said Bill Morneau, Canada’s Minister of Finance, “that’s why Canada and our G20 partners have been calling on multilateral development banks to use their existing resources as efficiently as possible, and to look for new ways to attract more private capital. We are pleased to see the African Development Bank come forward with a transaction that directly responds to both of these objectives. Room2Run is an innovative solution to a long-standing challenge.”

Juan Carlos Martorell, Co-Head of Structured Solutions at Mizuho International, adds, “Compared to other synthetic securitizations, a major achievement of Room2Run has been to ensure that ratings agencies, and in particular S&P, reflect the merits of the risk transfer into their rating assessments for multilateral development banks. AfDB’s leadership through this transaction has now set the stage for broader adoption of the instrument throughout the MDB community.”

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Fashion, Fame and Finances With SA Designer, David Tlale

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How would you say the African fashion market is growing?

We are starting to understand the business of fashion; how to create brands that are custom-made in Africa, which is what we need to be doing and I think more than anything else, we need local customers supporting local designers. Another thing we need to start seeing is retailers supporting proudly ‘made in Africa’ or ‘made in South Africa’ products because that’s the only way for us to become game-changers in the fashion industry. When you look at big brands in the US, Europe or anywhere else in the world, they work very closely with their local designers.

Your most expensive indulgence?

Fabric! When I go to a fabric store, locally and internationally, I am like a kid in a candy store. I would rather buy expensive fabric different to whatever is available locally [South Africa], to make sure I can still sell that to my clients. When it comes to fabric, I go all out.

David Tlale. Photo by Karen Mwendera.

What do you mostly spend your money on?

Shoes and handbags.

How have you maintained your brand over the years?

The only way for us a brand to grow is to continue reinventing ourselves every season. As a designer or as an artist, you are only as good as your previous collection. Also, don’t try and compete with anyone, but do and believe what ‘brand David Tlale’ stands for. It happens that from time to time we keep serving them the same thing, like the white blouse. Our customers also want it, but the question is, how do we reinvent it for the next season or the next collection?

The significance of grooming young African designers…?

It is realizing they are the future…the ones going to take the fashion industry to the next level making sure we still have brands from Africa to the global markets…It is important to expose them to the business of fashion because when I grew up, no one took me by the hand and said ‘David, this is how the business of fashion is’. We were told we have to showcase at fashion week but beyond that or before that, what happens? Now we understand that.

What was your first job and what did you learn from it?

I was a lecturer at Vaal University for four and a half years, just before I graduated. I was able to buy my mom new furniture and I bought myself some sewing machines. I am proud to say that my investment into that machinery has made us who we are as David Tlale. We now have a studio and a brand that is growing.

How do you diversify your investments?

What we have done as David Tlale, over the years, is to build the brand and invest everything into this brand. We are now starting to look at other investment portfolios so we are able to get different sources of income, not only from clothing; making sure we invest in the brand, as a lifestyle brand, it be accessories, handbags or perfume. We are working on a lot of things because we want to ensure that in the next few years, David Tlale is a holistic fashion brand.

READ MORE: Lessons To Learn From The Rich And Famous

What is your most recent acquisition?

A printing machine. It is a huge investment we have made for our business making sure that we are able to look different in the industry and can print our [own] fabric.

Your worst investment decision?

To believe in someone who did not believe in my brand…I suffered dearly from it but today I am better. We are on the journey to reposition David Tlale, ensuring we become a luxury brand proudly made in South Africa by South Africans [and selling to] the international markets.

 

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Investment Guide

Me & My Money: Izak Smit

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What is the one investment you wish you had made?

One of the best investments anyone can make is to invest in him or herself. There are the formal qualifications, yes, but in my experience the real important one is the informal personal development throughout one’s life. It takes effort and discipline. There are so many excellent books that I have read, and courses that I have attended later in my life, on strategy, innovation, leadership, selling and persuasion, presenting, time management, and a host of other soft skills that I wish I could have made earlier in my life.

What are your investment tips for 2018? 

The biggest tip of all is to first create the capacity to invest. Open a gap between what comes in and what goes out, and the tip here is not to focus on the income side, which is often, over the short term, not so much within your control, but rather on limiting expenses and waste, which is much more controllable. Try to find your happiness outside of consumption, instead of trying to buy bliss.  There is no independence quite as important as living within your means. Then, focus on building a fund that will preserve your lifestyle for life. This is a firewall that should ensure that you are not one day old and poor.

What do you invest in and why?

My investments have mostly been in boring, diversified unit trusts in retirement fund vehicles. But over time it starts accumulating when compound growth starts doing its magic. Luckily I am not much of a wheels person, I have only replaced cars twice in my life, although I do have a motorbike and have made some sizeable ‘investments’ into road and mountain bikes. I have never sold a property in which we have lived, so we have three now, renting out two, but from an investment perspective it has performed very poorly. I believe the house in which you live should rather be seen as a lifestyle possession, not an investment. I do ‘invest’ quite a bit in the liquid asset category called wine – but find that it does not last that long in the cellar before it is consumed. Another investment that has eroded quite a bit of our family’s lifestyle preservation fund is travel and experiences.  I would like to believe these are investments with internal value – these adventures bond families and shape character.

What investments have worked best for you?

One of the best things one can do is to make full use of retirement funds and other tax free vehicles. The state does not tax you when you make the investment, there is no tax on interest, dividends or capital gains, no estate duty, and some of the withdrawals might even be tax free. It is also difficult to touch it, which is a good thing; it protects you from your short term gratification weaknesses.

What investment strategy do you recommend? 

It is often said that the best investment is to pay off debt. I agree, but only after you have first made contributions to hedge against catastrophes and after you have made investments in a diversified portfolio of quality financial assets. I have seen too many people who have paid off debt first, throughout their lives, and ended up with still nothing in an investment portfolio in their fifties. Then make sure that the risk-return trade-off of your portfolio allows you to sleep well.

READ MORE: Me & My Money – Dion Shango

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