To The Power Of Three

Published 10 years ago
To The Power Of  Three

It’s a feat getting three powerful women in the same room, at the same table, on a Monday morning. Louisa Mojela, Gloria Serobe and Wendy Luhabe make it seem everyday. They are hard-hitting businesswomen. Yet five minutes into the pleasantries, you get a different feel as you repeatedly hear the words ‘trust’ and ‘happy’.

Trust is what built their company, and happy is the attitude they sport, the clothes they wear and what they call their two-storied, artfully-appointed office in Johannesburg’s leafy Houghton suburb.

“It’s the happy house,” says Mojela, Group CEO and co-founder of WIPHOLD (Women Investment Portfolio Holdings), one of South Africa’s best-known first generation empowerment companies owned and led by women.


True to Mojela’s word, a visit to WIPHOLD House, and random conversations with smiling staff, from the secretary to the finance manager, reveals a camaraderie that appears not prompted, not effected. But this corporate haven has been built on the back of 20 years of trials, tribulations – and triumph.

In its 20th year, WIPHOLD has a net asset value of more than $200 million; and this says a lot about a company that started with seed capital of $100,000 at a time when BEE (Black Economic Empowerment) was a little-known acronym.

At its core is a women’s empowerment model that has given financial power to grassroots black South African women from across the spectrum in Nelson Mandela’s Rainbow Nation. It’s a model that has stood the test of time, and the truth is, is still going strong, run by two of the four founders.


Today, WIPHOLD is 55% black owned, run with an all-female board, and as the first BEE company to establish permanent broad-based shareholding, has more than 1,200 direct and 18,000 indirect women beneficiaries through the WIPHOLD Investment Trust, more than 250,000 indirect women beneficiaries through the WIPHOLD NGO Trust, and is represented across South Africa. These days, it is also an operating company with interests in financial services, cement and coal.

But behind the WIPHOLD success is a story of grit, gumption and tireless tenacity. It is the story of four women, called the ‘Wip Four’ by the press in the early days, who founded a company weeks before a free South Africa was emerging from the dark shadows of apartheid.

Apart from Mojela, Luhabe and Serobe, the fourth founder, Nomhle Canca, is no longer associated with WIPHOLD, she left in 2002, but has fond memories of those early days (see box).

Luhabe, a thought-leader and mentor listed by FORBES as one of the most powerful women in African private equity, says their vision worked from the beginning because it was not about them.


“It was a vision to serve, to pioneer something that had not been done before, and because of that, it took us almost two years to get to a point we felt we had a sustainable business model. WIPHOLD’s vision is powerful because we didn’t rush into it,” she says.

“We wanted to build an institution that survives long after us. It also meant for a while we were the ones to add features to the baby,” says Serobe, CEO of Wipcapital and one of the two cofounders running WIPHOLD today.

How they did it


WIPHOLD was formed in 1994, but the deliberations had started a year before, when it was apparent South Africa was on the cusp of a new world, one that would bring black South Africans into the mainstream. History was about to be made, and the ‘Wip Four’ wanted to spearhead it.

The epiphany came at a workshop in Johannesburg aimed at telling black business about the new opportunities opening up.

“That workshop was full of men,” says Mojela. Along with Serobe, Mojela was already working at the time at Standard Corporate & Merchant Bank (SCMB) in Johannesburg, while Luhabe was an accomplished entrepreneur running her own company Bridging The Gap, which equipped black graduates with corporate skills.

And so it came to pass that in Luhabe’s small office in Melville in Johannesburg, the four met every Tuesday evening for 18 months, brainstorming over endless cups of tea, snacks and mangoes (when in season). Their vision took shape on the drawing board, slowly but surely.


At the heart of this vision were women from South Africa’s small towns and villages. Real women who were not numbers, but had names, jobs and who poured their sweat, blood and tears into their savings.

The vision was based on a simple premise: that these women would be given the opportunity to invest in South Africa’s biggest companies. So far, they knew only about savings, now they would learn about investments. “The enabling vision was created to give them a sense of ownership and empowerment at the same time, which is quite unique,” says Luhabe.

It is to WIPHOLD’s credit that for the last 20 years, it has been able to pay its shareholders dividends.

“Again, [we have been] very different from most empowerment models where only a few benefit. Our shareholders will confirm they have had benefits out of their investments,” says Luhabe.


David Shapiro, a Johannesburg-based investment expert and Director of Sasfin Securities, says WIPHOLD had an advantage as they had a head start.

“They started 20 years ago and stuck to it. They went through ups and downs but were fortunate. As early entrants, it allowed them to do prime deals. They are well-connected and highly competent ladies.”

The story of WIPHOLD cannot be told without harking back to the nineties, when the company reached its zenith. It was not easy doing business in a new South Africa.

“We underestimated the uphill [task] until we were in it. There was a big mountain to climb, and we had to break it down. Whether it was about meeting chauvinist or racist men, we knew this was the world we were getting into and we had to adapt with a lot of pain. The challenges were just too layered,” says Serobe.

Did the black brotherhood help? “One of our biggest challenges was our very own black brothers,” says Mojela. “We all came from historic disenfranchisement, and it was clear they were going to move ahead looking for these opportunities for themselves. But we thought, ‘we are big girls, we will hold our own hands; after all there was the four of us’.”

The rapport between the four didn’t happen overnight. It was built on a common vision. Mojela calls it the “glue” that bound them.

“The BEE was just an appendix for many of our male counterparts. For us, it is the reason for being,” says Mojela.

The first task was to come up with seed capital of $100,000. Each of the four founders had to chip in. Serobe was the first – helped by her young brother-in-law. Mojela was the last, taking three months to source funds from friends and family. “Credit to my partners [who waited],” she says.

What ensued was two years of slog, covering South Africa’s nine provinces with roadshows, convincing the women it was time they took responsibility for their finances, and shift from savings to investment.

One of the first workshops was at the Carlton Hotel in Johannesburg. They told the women, although they were providers of labor and consumers of goods and services, they had no part in wealth creation.

“Our strength was in numbers. The minute we decided to use women in the plural, it was only befitting we went out and galvanized them,” says Mojela.

“We had to convince them what we were doing had integrity and their hard-earned monies were not going to be misused. We also had to convince the business community we knew what we were doing,” says Luhabe.

Skepticism also came from the corridors of power. “We had no political credentials. People asked, ‘who are you?’” says Mojela.

So they looked towards the private sector for counsel.

Although Mojela, Serobe and Canca came from the banking industry, they were venturing into a sector they knew little about. They looked to the few who bought into their vision. One such was Geoff Snelgar, who they call their ‘godfather’. He offered them his boardroom on 66 Marshall Street.

In 1995, Snelgar formed Baobab Solid Growth, a listed entity with a market cap of R30 million (approx. $8 million at the time) that would incorporate black shareholders. Snelgar met with a number of potential empowerment shareholders, including Mojela and Canca, when they shared their vision.

“I thought it was a fantastic vision and, just as importantly, I really liked these people and their story. We agreed I would reserve a 10% shareholding in Baobab until the ladies could afford to pay for it. It was a verbal arrangement, promised completely on trust. Where most empowerment men I spoke to were hesitant, the ladies were the only ones who said ‘Yes, we want in. Let’s do it’. Who would’ve thought such an ordinary downtown meeting would pave the way for such a tremendous profit?” says Snelgar, now Chairman of Capricorn Capital Partners UK Limited, in the recently-released book commemorating WIPHOLD’s 20 years.

Baobab’s share price kept rising, and its market cap went to R3.5 billion (approx. $574 million) over four years. Baobab eventually became Theta, which later became African Bank Investments.

“If I could pinpoint one thing that impressed me most about WIPHOLD, it’s their integrity. A huge number of companies were set up under the auspices of broad-based economic empowerment – but were in actual fact a front for siphoning profit to a select few. WIPHOLD faced that choice many times. I remember the girls complaining about the lucrative opportunities they were missing out on. But they stuck to a vision that ensured their women beneficiaries were top priority,” says Snelgar.

“We have had to trade off certain things and let go of opportunities to make this work. We would have been billionaires as we speak if we hadn’t taken this route,” says Serobe. “We are both commercial and social, that’s why we are not billionaires,” adds Mojela.

Even as the ‘Wip Four’ were garnering female shareholders at the roadshows, they had to put something tangible on the table, and that was a portfolio of investments to the tune of R39 million (approx. $8.66 million) in 1997. The plan was a public offer for women only. This led to the creation of the foundation of WIPHOLD – the WIPHOLD Investment Trust.

“For every woman who subscribed in WIPHOLD in 1997, when we did the IPO, it fit that we created an investment trust they could participate in at no cost to them,” says Mojela.

The women were allocated units in the trust equating the number of shares they subscribed to in WIPHOLD. Mojela says it was important to form the trust as the custodian of the WIPHOLD vision with superior voting powers to WIPHOLD, just in case there came a point in the future when the company’s empowerment values were threatened.

The day the IPO opened is one none of the four founders will forget, as it was full of emotion and color.

“It was a very interesting day,” says Mojela. Cheques poured in from women from across the country, men called on behalf of their wives and daughters, and women from all walks of life, from madams to maids, streamed to their office in downtown Johannesburg holding affidavits., wanting to sign up. The two years of galvanizing them were finally paying off. In the end, it raised R25 million ($5 million).

“This was historic. Women had never raised that amount in the country. None of the BEE companies in existence then had. We were able to do that because we had prepared the ground in the first two years. The women were ready with their savings and wanted to participate,” says Luhabe.

And that was not all.

Next step was making the most of the opportunities.

“We needed R500 million (approx. $100 million) to take the company forward. There was an investment opportunity that required R250 million ($50 million) in 1998 so we went back to our shareholders with a ‘rights offer’. We knew it was going to be uphill, but the surprise was that in 12 months, these women were able to put R76 million ($12 million) on the table,” says Mojela. The remainder was privately placed with institutions.

With expansion and more investments came the challenge of adhering to the company’s original vision. “Institutions come with big cheques and big demands. Up until then, the company was 100% women, and now, we were diluted significantly,” says Mojela.

What entailed was a painful transition.

The institutions wanted liquidity. So WIPHOLD became the first women-only empowerment company to list on the Johannesburg Stock Exchange in March, 1999. The net asset value of the company then was a whopping R1 billion ($162 million).

Making new ground

Up until then, WIPHOLD had been an investment portfolio company, so the founders decided to embark on financial services, an industry they knew on account of their backgrounds in finance. They took this strategy to the shareholders, who signed off.

“But as we implemented it, hell broke loose,” says Serobe.

The shareholders felt this was competition.

“We were going to do things they did. They assumed we were miserable women who wouldn’t attempt anything more serious than micro-lending. Our idea was dwarfed in their heads. But we bought the top team of investment bankers – the Princeton and Stanford types – in the country. Our model now went head on with that of our shareholders,” says Serobe.

And this led to the genesis of Wipcapital in September 1999, which Serobe took charge of in 2001.

It was probably the most difficult phase for WIPHOLD, when it had to de-list in 2003. “It was a tense period,” says Mojela. “Business was not as expected, our salary bills were huge, we had to downsize, and were still hounded by shareholders. We had to go back to the drawing board. We decided the only salvation was to de-list from the stock exchange, return the cash to our shareholders and be left alone. In order to pay out, somebody needed to help us with hard cash. Ultimately, we got Old Mutual and did a scheme of arrangement.”

“We saw the original vision falling apart. The listing gave liquidity, but its downside was women had become a minority in their own company. The country and private sector weren’t ready for this. Through a scheme of arrangement, we bought off everybody including the women shareholders and brought them back into the shareholding via the trust,” says Serobe.

In 2005, WIPHOLD struck a headline-grabbing BEE deal with Old Mutual, which now owns 32.8% of the company.

“Starting from scratch after de-listing, WIPHOLD only had R166 million ($20 million) of [unlisted] assets. But today, we are a stable company with happy employees. We have grown from four to 40 employees, and will go from 40 to 400 in another 20 years,” says Mojela.

Miranda Feinstein, an executive consultant at Johannesburg law firm Edward Nathan Sonnenbergs, who was the architect of and continues to chair the WIPHOLD Investment Trust, and has known the founders for a long time, says she has seen their will strengthen with every adversity.

“Along the way mistakes were made; at times institutions treated them somewhat dismissively, but they always bounced back. At times, I saw they were disconsolate but one of their greatest traits is endurance. To this day, the WIPHOLD Trust is making financial benefits available to its women beneficiaries,” she says.

To reinforce their original vision, WIPHOLD also created the NGO Trust, addressing projects for women and children. Its creation increased the number of women to more than 250,000 beneficiaries, while the beneficiaries of the original trust stood at 18,000 (all of who participated in the 1997 IPO).

Through the WIPHOLD Trust, 80% of its income and profits are distributed to beneficiaries, and the remaining 20% to charitable organizations dealing with women and children. The two trusts account for 32.5% of the group’s shareholding.

Nongovernmental organizations like Tshwaranang Legal Advocacy Centre (TLAC), a center that promotes the rights of women to live free of violence, confirm they receive significant financial benefits from WIPHOLD.

“Last year, we received R270,000 ($25,000) from WIPHOLD. Their benefits help a lot to meet our operational costs,” says Shireen Motara, Executive Director of TLAC.

Recognition has come from abroad as well. The International Institute for Management Development (IMD) business school in Switzerland has used the WIPHOLD model as a case study.

WIPHOLD is now taking the model internationally. “The WIPHOLD story can be replicated anywhere in the world. We are taking the same workshops we did in South Africa in 1994, to the rest of Africa, in the Democratic Republic of Congo, Ghana, Zambia, Mozambique and Ivory Coast,” says Mojela.

WIPHOLD has partnered with Jidong Cement, a Chinese cement company, to build a plant in Limpopo, South Africa. Like financial services, the cement sector here is not known to be a business for women.

“But that’s exactly what excites us,” says Serobe.

The cement plant is a R3 billion ($280 million) project that will come online in 2015.

In 2009, WIPHOLD entered into a deal with Sasol Mining, leading to the creation of one of the first black-women controlled mining companies in South Africa, with 51% owned by WIPHOLD.

WIPHOLD has come far, and there have been other women-led investment companies like Nozala after them, but has the country been able to keep up?

“I can understood why 20 years ago, the captains of industry, our black brothers and the women behaved the way they did, but today, I have no patience for all three, especially women who don’t have the appetite to take on challenges. They fear trying. We had hoped in 1994 that by now, there would be many WIPHOLDs. Yet, 20 years later, in the same model, there is not another entity,” says Serobe.

The legacy they leave behind is not numbers, but a generation of African women who have learned to invest and be independent.