Economy / 8 September 2016, 1:31pm / Nicola Mawson, IOL Business Editor
Harare - Adam Molai is probably Zimbabwe’s most eccentric entrepreneur; sitting down with him is what I imagine interviewing Richard Branson would be like.
When you run his name through Google, you get all sorts of scandals: the fact that his company was probed for allegedly smuggling cigarettes out of Zimbabwe, allegations that his fortune was made because his wife is related to President Robert Mugabe, and that he allegedly dodges taxes.
One thing, however, is clear about Molai: he’s passionate about Zimbabwe. And about building a global empire that he expects will create jobs thanks to the multiplier effect and, with that, more per capita wealth. And he’s a self-starter.
Molai is chairperson of Savanna Tobacco, a proudly Zimbabwean company that’s taking on the likes of British American Tobacco. And that’s not the only pie he has his finger in – a pie that he is constantly expanding as wide as possible.
Molai, who is incredibly intelligent and entertaining, says Zimbabwe is one of the most misunderstood places in the world.
He argues the amount of attention the country is getting is commensurate with the opportunity in the market.
Molai argues that any honey pot will get a lot of attention. “As you get closer to the honey, you get stung by the bees.”
Some of the criticism isn’t fair, he says, and sometimes Zimbabweans bring it upon themselves. He says the world has placed an inordinate amount of attention on Zimbabwe because of the recent protests – protests he says were blown out of proportion but nonetheless saw looting and police brutality.
Molai compares the recent protests in Harare to the ones South Africa experiences on an almost daily basis, especially outside ANC headquarters, Luthuli House. He also points out that the country’s crime rate is low. “Here, a hijacking is front page news, in South Africa it wouldn’t even get a mention.”
Zimbabweans are peaceful people, he says, which is why the recent protests have grabbed the world’s attention - because they are unusual.
Molai is well educated, having completed his schooling in the most prestigious Zimbabwean school before leaving the country in 1992 to study abroad – and work. Initially, he studied in the UK, and then went to Canada – and his Canadian alma mater hands out an annual award he sponsored - Lakehead University’s Adam Molai Small Business Consulting Award.
Molai says he went back to Zimbabwe because of the opportunities he saw then - opportunities he still sees “in every direction”. He describes himself as a “kid in a candy store” with all the opportunities he sees, noting that it’s sometimes tricky to find the right opportunity, instead of just standing there and marvelling.
When we meet in his offices in Harare, he’s about to head into a strategy session to decide where to add to his empire, and where to cull – depending on return on investment.
Molai was brought up in a fast-moving consumer goods environment. His grandfather was in retail in the early 1960s – a period he describes as Zimbabwe’s apartheid, and his father was an entrepreneur who ran the largest black-owned Spar franchise in Zimbabwe.
Molai spent his childhood packing shelves and costing items – a subject he was later introduced to at university, even though he had been doing that since age 10. “I didn’t have a normal childhood.”
He openly admits to practising arbitrage at the young age of 10, at a time when Lion matches were in short supply. He tells a tale of buying a carton of matches on tick, with a face price of 5c, and then selling them for 20c a box at the bus terminal. Within a few hours, he had sold out, and made a decent amount of cash.
This entrepreneurial spirit kept with him through high school, where he started buying meat for a Sunday “braai” from his dad’s shop. It didn’t take long, he says, for this concept to take off, and he was sending large orders through to his dad on a Friday, at a decent mark-up.
Molai went to the UK in 1992 to study a business degree at Buckingham University, but needed to make some money. He signed up with Eissman International to be an agent to sell frozen food. Once he’d figured out how the business worked, he co-opted other students and made 25 000 pounds in one summer. When he went to Lakehead in 1994, he financed himself through a BCom and took over running a small and medium enterprise consultancy that was on its knees, he says, and rebranded it. Molai says the company was pulling in contracts from several entities, developing business plans and doing market research. He was earning $50 000 a year and “I was having fun”.
On Molai’s return to Zimbabwe, he was awarded a Shell franchise, and took the large office and turned it into a quick store, which he opened around the clock. At that time, he says, this was a novel concept for Zimbabwe. Molai says he saw a gap, and was filling a need, even though others told him he was mad. Soon, sales between 7pm and 7am – off hours – accounted for 60 percent of his income. Molai paints himself as a trailblazer, and in some ways he is. He’s also had his share of mistakes, such as selling alcohol 24/7, which turned out – he says – not to be a recipe for safety.
Molai openly admits he succeeded because he had nothing to lose, and everything to gain. He also says it helped that he had a good education and decent background and, as he puts it, “balls”.
Molai’s empire currently embraces tobacco, Pepsi, oil and retail outlets. Although he’s happy to boast, he says credit must go to management of each of these units. “I’m just the mad guy, they (management) are the guys who do this stuff.”
Molai’s modus operandi is to find a need, and fill it, and then to expand vertically as far as possible. As an example, he cites his fuel retail outlets, which he grew to a 20-percent market share. And then questioned why he was using a third party to truck in fuel, so he started a logistics company, which he says is now the largest in Zimbabwe, and exports into Mozambique and Zambia, with ambition to cover all of the Southern African Development Community.
Molai has grand aspirations. It’s not enough for him to conquer Zimbabwe; he wants to take on the world. “I don’t want to be a village chief... go big or go home.”
Molai aims to develop the entire value chain, and is happy to take on partners to fulfil this dream, noting that any business must one day be up for sale, because this shows it has created something of value.
He is also proud of developing an entire ecosystem on the back of his industries, and says he has empowered 70 000 tobacco farmers because of his interventions that saw contract farmers emerge after land reform was implemented. Molai explains the farmers were put on their feet because he persuaded the powers-that-be that they should be helped with education, and seeds.
Molai argues that his industries have created a downstream value chain, which has empowered thousands of people to have their own job - an outcome he says is the real proof of an entrepreneur. “We’ve helped develop a middle class that didn’t exist.”
His plans with Pepsi are to expand the value chain, and go into sugar farming, and he also sees huge opportunity in tomatoes because, he says, Zimbabwe has a climate that allows the crop to be grown year round.
Yet, Molai admits to challenges in Zimbabwe. He says the biggest one is for business and government to align their ambitions because trust between the two has broken down over the years. “Government must believe in us.”
Molai also says it is important for leaders to cut through euphemisms so real problems can be discussed, and real solutions found.
His ultimate ambition is to change the image of Africa as a begging basket case, and show the world the power it can be.
* Nicola Mawson was hosted in Zimbabwe courtesy of private enterprise in SA.