Missing the views and people of South Africa

The view of Cape Town from Table Mountain. (Photo by Michael Zifang Fan)

The first few weeks of class after spring break have been nonstop, so it’s nice to take a moment to remember the people and businesses we got to know in South Africa.

The country is facing unique challenges, straddling some of the benefits of a developed economy with some of the challenges of an emerging market country. It was incredible to visit the Johannesburg Stock Exchange and to hear about the challenges of maintaining the largest stock exchange in Africa in an environment with load shedding, or scheduled power outages.

At the Johannesburg Stock Exchange.

We met with financial firms launching new digital banks meant to target low to middle income South Africans — a group that went largely unserved by the formal financial system during the era of apartheid. We learned about a struggling retailer that is trying to rebuild after being overburdened with debt.

The waterfront in Cape Town. (Photo by Puja Kowley)

Our trip ended in Cape Town, a busy hub with stunning views on the southern coast of the country. It is fitting that our last company visit was Babylonstoren, an expansive farm and vineyard owned by CBS alum Koos Bekker (’84). The massive property also holds a hotel for guests who want to spend several days exploring the land and enjoying the good food and wine.

Based on what we saw that afternoon, Babylonstoren has plenty of services and activities to offer, leaving it with several diverse income streams. After a tasty spread and wine tasting, the head gardener took us on a private tour of the garden. We nibbled on fresh mint, sat on a lawn of chamomile, wet our feet in a fountain and snacked on citrus. All the while, we enjoyed views of the beautiful landscapes of Stellembosch. It was a fantastic way to end the trip. A big thank you to the organizers for planning such an incredible week.

–Jonnelle Marte ’19

Navigating the stark inequality in South Africa

A shantytown in Cape Town. (Photo by Jonnelle Marte)

Twenty-five years after the end of apartheid, the economic opportunities in South Africa are still very much divided along racial lines.

White people in the country make up a sliver of the population but own most of the wealth. A small number of black people have gained significant wealth since the end of apartheid, but they are in the minority. To add some numbers, the top 1 percent of South Africans – most of whom are white — own 71 percent of the country’s wealth. The bottom 60 percent of the population hold only 7 percent of the wealth.

Many of the executives we met with on this trip referenced the stark inequality as a distinct challenge that limits economic growth and shapes the identity of the client they work with. At the investment firm Investec, for example, most of their customers are middle-aged white South Africans. The firm has a philanthropic division aiming to close the gap by supporting education and entrepreneurship. But as one employee told CBS students, there are many issues to tackle related to racial inequality and all of them are equally important, making it difficult for well-meaning people to know where to start.

Apartheid was a discriminatory policy that segregated black South Africans from white South Africans and barred non-white people from working certain jobs and owning property. Families were forcibly removed from their homes and relocated into townships. Their opportunities were limited, and interracial relationships were prohibited.

Another hot issue mentioned by most of the business leaders we mentioned is the question of land reform. Some politicians and activists are calling for land to be returned to the South Africans who were robbed of their property during the apartheid era. The uncertainty over the future of land ownership is causing some people to hold back from making investments in agriculture and other industries that are reliant on land.

A neighborhood with colorful homes in Cape Town.. (Photo by J.C. Hay)

The unequal distribution of land is notable across the country. Some people have large homes, as well as access to good education and quality doctors. Many others, including the majority of black people in the country, are struggling to find jobs, let alone a place to live. Many reside in poor neighborhoods known as “townships.” In some shantytowns, people live in homes with a tin roof, cement walls and limited access to electricity.

The stagnant economy is making things worse people on the low end who are desperate to find work. With an unemployment rate of 27 percent, jobs are so scarce that agriculture firms hold back from automating tasks just to keep those jobs open. For example, sugar cane is harvested by hand, exposing workers to scorpions, snakes and other hazards. The work is difficult but there are people willing to take the risk for a paycheck.

The government has moved to support the poor by providing stipends and subsidizing education. But the efforts fall short of solving the inequality problem.

More businesses are starting to target consumers on the lower end by introducing financial products that more tailored to their needs. CBS students met with Michael le Roux, the founder of Capitec, a bank that launched in rural areas and grew rapidly by offering a simple account and lower rates on cash loans. The bank is now facing more competition from other companies targeting the low end of the market.

Discovery Limited, an insurance company that offers discounts to people who meet health targets, is launching a digital bank this month. The account will pay higher interest rates to people who adopt financially healthy habits, such as saving and paying off debt. TymeBank is another digital bank entering the market that will not charge monthly fees, arguing that it will save money by not offering physical bank branches, instead offering cash machines inside of grocery stores.

It will be interesting to see if these companies succeed.

— Jonnelle Marte ’19

Lights off – and back on – in Johannesburg

Shortly after arriving in Johannesburg, CBS students had to adjust quickly to a mild inconvenience. The lights kept flickering on and off in the hotel, leaving some people in the dark in their rooms and leading to long waits for the elevator.

The outages continued over the next couple of days, causing students to experience a few seconds or minutes of darkness at restaurants, in corporate conference rooms or at other events around the city.

Blackouts are a regular occurrence in Johannesburg, where there is insufficient infrastructure to provide continuous electricity for all the homes and buildings. However, the outages have been especially frequent after a cyclone in Mozambique damaged some of the power lines. 

Cyclone Idai, which landed in Mozambique on Thursday and swept over parts of Zimbabwe and Malawi, may have killed more than 1,000 people, according to a report from CNN. Government officials and rescue workers are still assessing the damage and the lives lost.

For the residents of Johannesburg, the impact is felt mostly in the increased frequency of blackouts. The city announced Saturday that it would be scheduling more outages, a practice known as “load shedding” that is meant to prevent an overload in the system. Eskom, the main electricity company in South Africa, moved the city to Stage 4 load shedding, the highest level and the point at which the government can enact unscheduled power outages as needed.

Load shedding has been mentioned again and again during our company visits as an example of the many ways that South Africa is still very much a developing country. The nation is home to the largest stock exchange in Africa, the Johannesburg Stock Exchange, and it has one of the most mature banking markets on the continent. It also has a liquid currency that can be bought and sold easily. At the same time, the unemployment rate is high, inflation is problematic, and the currency is among the most volatile in the world.

Some residents in the Soweto township may not be able to afford generators, making them more vulnerable to the power outages caused by load shedding.

As part of their daily lives, South Africans must deal with a low-performing schools, traffic-jammed roads and regular power outages. Some of the business executives we spoke with acknowledged that poor people are affected most by load shedding because they cannot afford to buy a generator. That could include people who live in the poor neighborhoods known as townships, where the homes are smaller, worn down and lack many of the amenities available in the wealthier neighborhoods.

At the businesses we visited, the darkness would last only for the few seconds that it took for the generators to kick into play. For South African residents who don’t have those financial resources, the outages can last for hours. With more of the blackouts being unplanned, the daily consequences could be far-reaching.

— Jonnelle Marte ’19

CBS on Safari in South Africa

South Africa’s massive safari industry is one of the biggest draws for tourists. 

With just a few days to go before the launch of the official Chazen GIP Trip to South Africa, about two dozen CBS students arrived in the country early for a chance to witness the nation’s sprawling landscapes and spot their favorite wildlife.

We drove out before dawn on Friday morning to begin our nearly 12-hour safari adventure in Kruger National Park, one of the largest game reserves in Africa. Our early departure paid off almost immediately when managed to see all the animals known as “The Big Five” before we even sat down for breakfast.

The Big Five — a list that includes the elephant, buffalo, rhinoceros, lion and the leopard – became known as the most dangerous animals to hunt because of their tendency to charge toward humans when they see them on foot instead of running away. Now that many of these animals are protected from hunting, the Big Five are the most popular animals to catch on camera. But some of them are much easier to find than others.

Within minutes of entering the park we came across a majestic herd of elephants grazing. We were also in awe when we approached three white rhinos eating near the road. The rhinoceros is one of the creatures most sought after by poachers who want to sell their horns for tens of thousands of dollars on the black market. Kruger loses about one rhino a day to poachers, according to our guide.

The most elusive animal was the leopard, which is hard to see because they tend to travel by themselves and are most active at night.

We received a tip from another guide about an impala “acting kind of crazy,” a sign that a predator might be lurking near. Sure enough, some people in our group saw a leopard slinking around in the tall grass while the impala squealed in fear. Sadly, the sightings were almost too fleeting to count for some of us who witnessed only a tail or a silhouette.

We will get a second chance to spot a leopard on Saturday morning when we participate in half a day of safari before boarding our flights to meet the rest of our classmates in Johannesburg.

The tourism sector overall contributed 2.9 percent to South Africa’s gross domestic product and employed 687,000 people in 2016, according to the most recent data available from Statistics South Africa. In an economy with a 25 percent unemployment rate, every job counts.

Bangu Masisi, the South African tourism official who spoke to our class earlier in the semester said that the government is currently running a campaign to inform tourists about the other attractions that South Africa has to offer, such as surfing and wine tasting. We will get to experience the wine industry firsthand when we visit the Stellenbosch region near Cape Town on Friday to see a vineyard owned by a CBS alum. Stay tuned to learn about more of our adventures between now and then!

— Jonnelle Marte ’19

South Africa: Already Ready for a Reunion

The clamor for a Chazen South Africa reunion began minutes after the official trip ended. “I’m having separation anxiety already you guys,” wailed one particularly emotive person into our GroupMe chat while still boarding the flight from Johannesburg back to John F. Kennedy airport. In the last few days, even as we returned to our routines in New York, birthday parties have been co-opted into reunions, trips to South African wine bars planned, and much love and longing expressed for each other.

Personally, this was one of the best trips I went on, and I made many friends I don’t think I otherwise would have made at Columbia Business School. The magic of South Africa has surely something to do with it.

IMG_3059.jpgFor starters, many of us were compelled by South Africa’s history. The most soulful moments of the tour came when we understood more about the history of apartheid—either on Robben Island, home to so many political prisoners including Nelson Mandela, or at the Apartheid Museum in Johannesburg. We had much to reflect—for instance, how apartheid started off as a solution to urbanization (certainly not the common way societies deal with that trend), and also how Mandela and the ANC’s resistance was mostly peaceful (certainly not the common way the oppressed resist throughout history).

Yet perhaps that sense of peace has ensured that South Africa’s economy is today nowhere near as ravaged as, say, Zimbabwe. It’s grown to become one of the BRICS emerging markets. As this blog detailed earlier this month, Chazen saw many interesting businesses and met many striving entrepreneurs. We couldn’t help but remark to each other how such economic energy has arisen from the ashes of apartheid.

Along the way, South Africa’s biodiversity brought us closer. There are some things in life we can’t share without becoming good friends with each other—and the majesty of an African elephant brushing past our jeep during a Kruger Park game drive, the cuteness overload of watching a penguin waddling on a beach by the Cape of Good Hope, or the exhaustion after having climbed the 1,000 meters up Table Mountain to arrive at the best views of Cape Town surely count among them.


Lastly, this trip was successful because of our organizers: Thando Mtshali ’18, Divya Raj ’18 and Maria Sebastian ’18, who worked under the aegis of the Chazen Institute. The three perfectly understood when to hold our hands through Johannesburg’s bustling business district and when to let us discover the amazing nightlife of Cape Town on our own. I want to personally thank Thando, who grew up in Durban, for helping us see so many nuances of South African life I think we would have otherwise missed.

These organizers were so good at their task of bringing us together that they needn’t bother about organizing a reunion for us to relive our South Africa glories. As you can tell, that will happen spontaneously.

–Abheek Bhattacharya ’18

Searching for South Africa’s Entrepreneurs

After the impossibly beautiful nestled-between-the-sea-and-hills views of Cape Town and the primordial right-out-of-Planet-Earth feel of our Kruger Park safaris, Chazen South Africa landed at our final destination earlier this week: the commercial capital of South Africa, Johannesburg.

IMG_3115.jpgJohannesburg was built from scratch around neighboring gold mines—unlike the other big commercial cities of the globe, it has no natural advantages such as river or sea access—so it was fitting that the question occupying us during our business visits here was how new businesses in South Africa can similarly be built from scratch. That is, what exactly is the state of South African entrepreneurship?

We visited a man called Sizwe Nxasana, perhaps one of the most inspirational business leaders any of us have met. Sizwe was one of the first six black accountants in apartheid South Africa. Considering all the odds against black businessmen before the country became a democracy in 1994, he managed to co-found his own accounting firm in 1989 that today is the fifth largest in the country after the global Big Four auditors.

IMG_3162.jpgA born career-switcher, Sizwe then went on to become CEO of the state-run telecom company in 1998. Though he knew nothing about telecom, he understood that telecommunications would be the way to help poor blacks reach into the new century. He helped partially privatize the company, list it on public bourses, and cut its bloated staff by half. If that wasn’t enough, the restless Sizwe switched again—leading one of the nation’s largest banks. Now semi-retired, he devotes his whole time to an education nonprofit he founded Sifiso Learning Group, with the goal of improving both quality and access to education.

Are there lessons from Sizwe’s own story? He humbly says he just happened to be at the right place in the right time, one of the few black South Africans with a business background who could help Nelson Mandela’s post-apartheid state rebuild. But he is worried that entrepreneurs across South Africa are today getting squeezed by the triple pincers of Big Government, Big Business and Big Labor.

The government highly regulates many parts of the economy—in education, for instance, there are lots of mandates about what can be taught, and even rules governing the hours of the school day. Meanwhile, the budget deficit is worryingly rising, sucking capital that could otherwise be deployed to the private sector.

As for Big Business, they probably like the rules that erect barriers for newcomers. Lastly, unions throw up problems for hiring. Teacher unions are some of the most vocal opponents of the education reform Sizwe and others want, for example. At this rate, it’s difficult for South African entrepreneurs to break out.

The good news is that it is possible for a homegrown South African business to become a powerful global brand. To witness that, we visited Nando’s, the casual dining chain famous for its spicy Mozambican chicken.

Nando’s was started by two South African entrepreneurs in the late 1980s, and grew because of its tasty product (which is a local staple in neighboring Mozambique); its impeccable quality control of its chillies from local farmers; and a plucky brand that gets attention through provocative advertising campaigns. Nando’s isn’t that big in the U.S. yet (there are just 40 locations), but it’s become a cultural staple in the U.K., and is growing quickly in the Middle East and India.

98C5D308-A10A-402D-8E8A-C26F63BBF12D.jpgEntrepreneurship is hard in most parts of the world. But it’s even more so in South Africa, given the pressures governments, big businessmen and unions apply. Perhaps the consolation here is that the entrepreneurs who do make it have to have such velocity to escape the harsh gravity of this economy, that they truly zoom onto the world stage.

~Abheek Bhattacharya ’18

Safari Times in South Africa

From Cape Town, Chazen South Africa made its way to Kruger Park and its glorious five million acres of forest reserves last weekend. We went on not one, but two safari treks over two days.

IMG_2991.jpgThe more serious highlights were:

  • Witnessing four of the “Big Five” game animals, so called because if you attack them, they will attack back:
    • Wild buffalos, the most unpredictable of these five. Thankfully, we saw them from afar.
    • A lion, lazy and imperious.
    • Many elephants, one too close to our safari jeep for comfort.
    • And, despite all the species’s surreptitiousness, some of us managed two sightings of leopards. In one of these, the big cat was cooling itself on the branch of a tree.
  • The only one of the Big Five we didn’t get to see: the rhino.
    • That’s no surprise given the horrific increase in rhino poaching that’s occurred across the continent since 2008. The reason? Chinese and Vietnamese households either desire the powder of the rhino horn (for bizarre medical reasons) or the horn itself as a symbol of wealth and status. The rhino is now shockingly endangered in South Africa.
    • We attended an excellent lecture on rhino conservation, where we heard all the myriad ways South Africa has tried to stave off poachers but failed. I personally came away with the conclusion that the one path South Africa hasn’t taken may be the best shot—and that is, to legalize the trade of rhino horns. This might paradoxically help save the rhino. It will help officials flood the market with their own stockpile of rhino horns, thereby driving the global price down, and also allow them to tightly regulate activities.

The less serious highlights were:

  • Our spot-on safari wear, some of it hastily acquired in Cape Town to fit the occasion. Shout-outs to Patrick Yee ’19 and Ankit Chadha ’19 for being especially spot on.


  • Dinner in the bush—in a small enclosure in the forest—where we ate some finger-licking sausages made from the kudu (an antelope), and rang in a trip member’s 30th
  • Those few occasions when we witnessed the, ahem, “fifth leg” of these quadrupeds.
  • That one time one of us (who will go unnamed) thought that the leopard the rest of us spotted on a tree was lying on the ground. Alas, he was looking at a rock.
  • All those times some of us (including this writer) squealed on seeing a game animal.
  • All the times the men of Chazen South Africa ’18 flirted with the stunning female safari tour guide, but never managed to get her number.


All in all, it was an epic safari trip. In fact, to borrow a phrase from one of the most vivacious members of our entourage, nothing Chazen South Africa ’18 did wasn’t epic.

~Abheek Bhattacharya ’18

South Africa: The State of Trust

Chazen South Africa’s first four days were full of side-splitting laughter and rib-tickling fun in Cape Town. We climbed the 1,100-meter high Table Mountain, wined and dined (and drummed away at an African restaurant), and rang in two birthdays.

IMG_2856.jpgBut in a land of poverty and inequality, we were presented with much to ponder over, too. The common thread we observed in our visits is that of trust—trust in public institutions and, more generally, trust in other South Africans.

At its infamous prison in Robben Island, the apartheid regime broke a black South African’s trust in his white countryman for decades. Prisoners worked nonstop in limestone quarries under the blinding sun without any sunglasses, permanently impairing eyesight. They could barely speak with their loved ones, or be brought news of the outside world. And a top political prisoner was tortured by purposely being brought outside news—and prevented from sharing the news with anyone else.

We visited two e-commerce firms in South Africa—TakeALot, the Amazon.com the country, as well as Yuppie Chef, a niche kitchen-appliance vendor—both of whom talked about how the online market in the country is still so small. Despite being compared to other large emerging markets such as China or India, South African e-commerce is barely 1% of total retail sales, whereas China’s is nearly 20% and India’s in the high single digits.

IMG_2823.jpgOne reason: A history of banking fraud in South Africa has slowed development of online payments. Those who follow the explosive growth of e-commerce in Asia will know how significant a role Alibaba’s own payment service played in creating trust in e-commerce across China. Called AliPay, that service keeps customer money in an escrow account that won’t be forwarded to the merchant until the customer was happy with the product.

We also visited a financial planning startup in Cape Town called 22seven, akin to Mint.com or Betterment in the U.S. Part of a financial conglomerate called Old Mutual, 22seven’s mobile app is still getting its feet off the ground when it comes to growing its user base. South Africans need to be coaxed to enter their financial details on a mobile app.

IMG_2815.jpgOften, the mistrust is directly aimed at the public provision of goods that we in the West take for granted. At Township Farmers, we saw a social enterprise try to kill two birds with one stone—a daycare center for children under 6 years of age who might otherwise fall prey to the worst in society, and an organic farm in the backyard of that center that teaches children about agriculture. The children are happiest around the garden, while the farm piggy-backs on the infrastructure, especially the water, of the daycare center. One depends on the other, because the provision of education and water is otherwise so poor.

All this said, South Africans are a technically accomplished and entrepreneurial bunch, and are making strides. Online payments now require a user to key in a PIN using a mobile device, which should foster trust. Yuppie Chef goes out of its way to write handwritten cards to new consumers who buy appliances off its website, creating a bond to both the brand and to the otherwise impersonal edifice of e-commerce. Township Farmer’s very existence is proof of risk takers looking for roundabouts.

In other words, this is the hard slog of building brands and institutions—and new mindsets. Like in other emerging markets, perhaps what one needs most is patience. As one of our tour guides observed when we were waiting for an hour for a meal: We in the West may have a (wrist) watch, but in South Africa they have the time.

~Abheek Bhattacharya ’18

Bless CBS Down in South Africa

Travel is supposed to make the world feel smaller. But on the eve of our Chazen trip to South Africa, the feeling among the 30 of us is probably of the size and expanse of our coming excursion.

Over the next 10-odd days, we will try to familiarize ourselves with the history, culture and economy of the fifth largest country in Africa by population. We’ll visit 10 companies, ranging from a firm that makes explosives for mining to a nonprofit that teaches agriculture to children.

We will hike to Table Mountain in Cape Town and bask in the impossibly beautiful views of a city often sandwiched between the sea and the hills. We’ll go to Apartheid Museum in Johannesburg to learn about the one of the most notorious regimes of postwar history, and also to Robben Island in Cape Town—where Nelson Mandela was imprisoned for many years—to appreciate the great man who fought that regime. And we’ll ride on a safari through the world-famous Kruger National Park and its 5 million acres.

There is a lot to take in, and the excitement that precedes any big trip is this time mixed with some fear—at least for me. Thankfully, our trip is ably led by Thando Mtshali ’18, Divya Raj ’18 and Maria Sebastian ’18, and under the watchful eye of Prof. Elizabeth Webb.

So eager were we CBS-ers that some of us got to Cape Town a few nights before the official start of the trip. I am already in awe of the city’s beautiful mountains and beaches, as well as its vibrant restaurants and nightlife. Plus, we got to ring in the New Year here in style, some of us in a little more style than the others…

I’m looking forward to sharing more of our adventures over the next 10 days.

~Abheek Bhattacharya ’18

CBS Chazen South Africa 3.0 (Good Bye Jo’Burg, Hello Cape Town)

Our last day in Johannesburg represented an opportunity to hear a practitioner’s perspective on capital flows and the strength of the South African mortgage market as well as get in on a very interesting student housing project in the center of Johannesburg. Our team heard from Manie Annandale, Nedbank head of Affordable Housing Finance who was gracious with his time and provided a brief review of the banking regulatory environment, current players in the marketplace and opportunities for growth. After the Nedbank tour, we headed to the Braamfontein area of Johannesburg where IHS owns and manages Studentdigz, a 948-unit portfolio of student housing projects with access to University of Johannesburg and Witts University.


When the Studentdigz tour concluded, our bus headed to the airport where we hopped on a 3 hour-long flight to Cape Town and the excitement of getting to discover another city in this wonderful country. The same night, we dined at Sevruga on the V&A waterfront, one of the premier coastal destinations in the world that we toured the following day (& discussed at length in our next article). It had only been a few days in South Africa for all of us, but we were each feeling very much invested in trying to find solutions to the problems of housing affordability we noted.