🔒 Investec founders: eavesdrop on business icons Ian Kantor, Bernard Kantor, Stephen Koseff

Even in Investec’s formative years there was little doubt that something exceptional was being created. In this fascinating Noontime Thursday webinar, BizNews founder Alec Hogg speaks to the first CEO and subsequent chairman of Investec, Ian Kantor; his brother, fellow co-founder and subsequent MD of the UK operations Bernard Kantor; and another co-founder, long-time CEO Stephen Koseff. The iconic business legends reminisce about the extraordinary journey of Investec – from their first acquisition to their endorsement of Tottenham Hotspur. The witty and personal banter captured in this webinar makes you feel like you’re eavesdropping on a conversation. On the subject of human dynamics in business, Ian states that the idea that anyone could make any decision they liked as long as it was unanimous was the basis of what they refer to as Investec’s culture. “There’s nothing more to it. Anything you like as long as it’s unanimous, which means you really get to understand each other pretty well and the substance of what you’re dealing with. And that, in a way, became the binding factor between us.” – Nadya Swart

Alec Hogg: Welcome to our three guests: Stephen Koseff, Ian Kantor and Bernard Kantor. We are talking Investec today and what triggered this resignation of Ian Kantor off the board of Investec after forty-five years. It’s quite extraordinary. 
___STEADY_PAYWALL___

I would like to maybe start off with a word from Ian, because you are the elder brother and I suppose the other two would say one of the original, original founders (because you are all founders). But just tell us – before we start going to the questions, Ian – how Investec came to be. 

Ian Kantor: How long have you got? 

Alec Hogg: Any time that makes sense.

Ian Kantor’s Investec journey

Ian Kantor: Short answer is by accident. I was an engineer, went to business school, learned about the mathematics finance, joined IBM, had a client – LeasePlan International. I knew the people well and they invited me to join them. And I thought, well, what they were doing was really exciting – it was big leverage leasing and project finance. I was absolutely happy there and I think I would still be working there had they not sold the business at that time. 

And I thought, well, I’m not working for a bank. And I was on holiday in Cape Town, got onto a plane (with my own money), and flew to Johannesburg and went to the captain and said: “I’m sorry, I don’t want to work for a big bank and left”. Very decent people, lovely business, learned a hell of a lot. 

That night was Christmas and I went to the IBM Christmas party and the LeasePlan Christmas party in Sunnyside. And then somebody said, come we’re going to the NCR Christmas party, where I bumped into another former IBM client – Michael Lewis. We owe Michael a great deal – without Michael, this would not have happened. Michael said to me: “What are you doing, boy?” And I said to Michael: “As of today, I am jobless”. He said: “No, you’ve got a job starting tomorrow”. And yeah, that was it. 

Read also: SA success story: FirstRand founders share how they forged a strong relationship

Eventually, Michael had spent a lot of money on property, etc. There were some cash flow constraints, so we bought the business from them. Errol had joined me and I learned a vast amount from Errol, but my first important lesson was as a partner. 

When we did the deal, I said: “Okay Errol, we’re doing this deal and you’re my junior partner”. He said: “What do you mean, junior partner? Partners are partners”. And I thought, it makes sense. Partners are partners and that was the rule. And then Larry joined us, so he was also a partner and it was the three of us. 

Alec Hogg: Late Errol Grolman and Larry Nestadt (who’s still in Johannesburg). I remember the five of you were together. So it’s a pity, obviously, the others can’t join us today. But, Bernard, you and Ian are related? 

Bernard Kantor: That is sadly correct, Alec. Common parents. 

Alec Hogg: And how did you get pulled into the Investec crowd? 

Bernard Kantor: What Ian didn’t mention is that I contributed towards his knowledge – I taught him about anger management. I was working for a leasing company at that stage which then dissolved, and I took over the remnants of the book (if I remember correctly) and started a small leasing company and I operated from the offices of Investec. 

Not long thereafter, they said, well why don’t you just join us, and I said, no, no – this place is not big enough for Ian and I. I should have stuck with that. Sadly, I was convinced to join them and it’s been an incredible path. You couldn’t wish for more. Surrounded by very smart people. And that’s really how I started with Investec back in 1978. I’m older than I thought. 

Alec Hogg: So, Stephen, obviously, the two of you are still pretty close?

Stephen Koseff: Yeah, we still talk a few times a week. Less than we used to talk when we worked together – that was every day. But we’ve been together a long, long time and it’s been a hell of a journey. We’ve all got grey hair now, but still – I’ve got good memories. 

Alec Hogg: It’s quite an extraordinary story on the different deals that you did through the years and I’m sure we’re going to talk about that in a moment. The one thing that struck me and you’ll hear from some of your friends in the podcast as we go through, is this intense pro South African view that you had. You’ve always been out there boxing for the country. 

On hope

Stephen Koseff: We always have to have hope and we always have to try and make sure that the country grows and develops. And therefore, one became quite outspoken on many, many subjects. And there’s always hope, but you want to do the right thing – to deliver on the hope. And that’s when one gets outspoken, when we think the guys are going down the wrong road. But South Africa has a lot going for it, but it has to go down the right road. 

Alec Hogg: Ian – this gentleman, I’m sure you’ll recognise his voice, is the first of your friends that we’ve asked to just give a little comment. Here’s Glynn Burger.

Ian, Stephen, Bernard, Investec. I joined Investec 40 years ago. Working with you guys at Investec has been remarkable. The ups and downs are all in the past now. The memories of the people that have graced Investec, including you three, will last forever. When I look back: the way we used to overestimate our soccer skills still brings a smile to my face. We thought we were so much better than we were. The sharing of the past 40 years and seeing the business grow has been very, very special. Working for Investec and with you guys has been a huge privilege. Thanks.” 

Alec Hogg: Ian, you were a close team – also with your brother, Bernard, being in it must have brought a new dynamic. How did you manage those collisions? How did you ensure that Investec was able to stay together? 

Ian Kantor: Alec, to be honest, it was difficult. We were all keen and enthusiastic. There were no ambitions of being a bank or anything. We had a leasing company and we were really excited about it. I think you naturally want the best for the business. You had differences of opinion and I learned very quickly that I had a problem, because every time – whatever I agreed to with Larry, Glynn or Bernard or Stephen – somebody else would say: “Why are you doing that? I told you not to do that. I told you you should have done this. I thought you couldn’t do that”. 

There were so many ‘didn’ts, couldn’ts, wouldn’ts’ and I said: “Okay guys, we are gonna meet every morning at 07h30”. We used to go upstairs to the gym at 07h30 and have a meeting. And the rule became that anybody could veto anything. And that meant that you actually had to find a way of understanding why somebody was objecting and that became a very valuable process. 

This thing of: you can make any decision you like as long as it’s unanimous is the basis of what we refer to as Investec’s culture. There’s nothing more to it. Anything you like as long as it’s unanimous, which means you really get to understand each other pretty well and the substance of what you’re dealing with. And that, in a way, became the binding factor between us. 

None of us has actually left voluntarily – none of us. You get to an age where you say well, I’ve got to stop. But, none of us said no, we want to leave. I don’t think we set out to be new, different, innovative. We wanted to be better. We wanted the service level to be better. So, the level of service to us was absolutely fundamental and that came out of this process. 

The process became the motor behind doing things better, doing things differently, doing things in a new kind of way, finding a different angle to improve the level of service and what it could mean to our environment. If we weren’t doing something for our environment or society – we weren’t relevant. If you’re not relevant – give up.

Investec – the name

Alec Hogg: That’s way ahead of its time. But there’s a question here from Warren Thompson – the financial services editor of Business Day – and he asks who came up with the name? 

Ian Kantor: It’s interesting – the name has lasted, the logo has lasted. We just made a list of names. It was Errol, myself and Larry. Larry was sitting at the table, but Errol was writing and he had two columns of words. There was investment and there was technology. So, we eventually applied the word Investech – ech. We were very upset when they refused to give that to us, so we had to drop the H. In hindsight, I’m very fortunate. 

Alec Hogg: Extraordinary that it’s gone right around the world now. Bernard, I visited your offices in Gresham street and I see you’ve move from one part of Gresham Street to another part of Gresham Street in London. Investec is now well established in the UK. It must be tough, though, in the early days to get that to happen. 

Bernard Kantor: Alec, our first acquisition was Allied Trust Bank – we bought it from Barclays Bank. That was in 1992, 1993. We used to go every month of our lives and meet with the executive. In those days, there weren’t Zoom calls and that sort of thing. We had a big investment. 

Then, in 1997, I went to the UK and honestly, it was a small operation – at that stage there were maybe 50, 60 people, if that – and I knew nobody. And I remember phoning Stephen – I’ll never forget it. I was walking towards London Bridge from the city and I said to Stephen: “Stephen, no one is really interested in a small little bank that is owned by South Africans”. He said: “Just be patient. It will come. Relax. I promise you – something will happen”. 

And in the next 10 years, we made about, I would imagine, eight or 10 acquisitions. I think, really, the philosophy was that we wanted to create a foundation, a platform – globally. And that was almost in a sense a mandate that we worked to. I think life has changed somewhat and unfortunately now with Covid and everything else… I think Stephen and I and Ian have been through six or seven crises.

Read also: Investec dons Santa’s hat: Cancels mortgage bonds on 3,600 properties in Gauteng townships

Alec Hogg: Stephen, maybe you can pick up there. Did Bernard pull the short straw to go to the UK or was there a competition for that job? 

Stephen Koseff: No – one of us had to stay, one of us had to go. Bernard was the one who was keener to go. When we listed in London, the regulator did insist that the CEO and the CFO were South African or remained in South Africa. So, it just worked out that way. 

But we did spend a lot of time together in terms of making multiple acquisitions and building what ultimately became what is 91 today. The UK part came from a flight acquisition. We bought Carr Sheppards in London, then we merged with Rensburg Sheppard, and then we bought out minority shareholders in 2010. So, we did lots of transactions to lay the foundations of the organisation. 

Most of them were reasonably good, but one or two – not so good. You always make mistakes when you’re very entrepreneurial, but still – the platform is there. As you said, the brand is well known around the world and the new guys have got the ball and they’re running with it. 

Human investments

Alec Hogg: One of the best investments you’ve made was a human investment in Hendrik du Toit. This is what he had to say about you guys. I asked him to give us a short message. 

It has been my privilege to work with Ian, Bernard, Stephen for almost three decades. Ian left the board of Investec after 45 years – mostly as non-executive. Bernard and Stephen ran the business for most of the time it existed. And what I want to share about them is not their entrepreneurial achievements – those are well-known, those are well respected. They built a fantastic organisation, which they operate as two separate businesses, namely: Investec and, of course, 91.

But what I want to add on them and about them is the fact that they’ve always remained themselves. They’ve been authentic, true to who they are – right through the time I’ve worked with them. And most importantly, they taught me the importance of people in business.

Ultimately, these three great entrepreneurs understood how to harness human endeavour, human energy, and the people’s side of the business for ultimate business success. We can all learn from that and we should all celebrate what they’ve created and what they’ve contributed to South Africa and the world. In their retirement, I wish them very well, and I’m sure this is not the last we’ll hear of them. We will – as Investec alumni and 91 people – remain in touch with these special people.” 

Alec Hogg: Nice little message from him. Helena Barsham wanted to know which of you are still involved in Ninety One? In other words, in Hendrik’s business.

Stephen Koseff: None of us. 

Bernard Kantor: Hendrik was too clever for that. 

Alec Hogg: But Ian, the point that Hendrik made – and it’s one that having watched your incredible growth of the business over the years, I have to endorse – I haven’t seen any other business in the thousands (presumably, that I’ve come across as a financial journalist) which has put as much attention on the hiring process of the people, getting the people on board. And Hendrik spoke about people. How did that get so deeply embedded in your culture? 

Ian Kantor: Just that same simple process that I mentioned earlier. I just want to say thank you to Hendrik. Hendrik, baie dankie. It was that same process that said anybody had a veto right. So, the people that we worked with were so fundamental that that same right applied. So, if we want to – at any level in the organisation – employ a person, then let’s say the team, which was normally say up to six people – everybody would interview that person and if one person said no, the answer was no. 

So, there was a lot of scrapping and fighting to get somebody that you wanted in or to make sure that they didn’t get in. It helped us get it right in terms of having people that we could work. It was very difficult in that process to deal with a double agenda. 

We didn’t have people who were particularly innovative or creative or brilliant, in that sense. Just digging through to find ways of being able to agree with each other, which often forced us to do things that were not obvious, those are the people that we wanted. Just straight, decent, face value, honest people. 

Endorsing Tottenham Hotspur – business or personal

Alec Hogg: It’s quite a rare approach you’ve used there and I’ve seen it elsewhere as well. Allan Gray has got something similar to yours. It would be interesting to know where they picked it up from. I know in the old Moneyweb – when I started that business, I very much used the Investec approach. So, thank you. I’m indebted to you. And of course, at BizNews – we very much use that way.

This is for the midfield general. It’s from Edward Nelhiumbeni. He says: the endorsement of Tottenham Hotspur – was it personal or business initiated? 

Stephen Koseff: One day Bernard phoned me and said: listen, we can get the rights to sponsor Tottenham Hotspur. I said, Bernard, they’re gonna say exactly what this Edward said to you. He said: It’s not about you, it’s about Investec. And we got the rights for 500,000 pounds (for just the cup games – the league was someone else) and I guess, even though I’m the supporter, I have to admit that it worked really well. 

People still think we sponsor them, even though we haven’t for about 10 years. I don’t think it was personal. You can ask Bernard to validate that. But at the end of the day, I’m happy we did. Liverpool was too expensive.

Alec Hogg: Are you also a Spurs fan, Bernard? 

Bernard Kantor: No, definitely not. I support Liverpool. A well known fact – you haven’t done your homework. 

Alec Hogg: I haven’t indeed. But what I do know is you also sponsor the English Derby in England. And I guess Stephen would say that that was also definitely not a personal influenced decision. 

Bernard Kantor: I think the personal part is that I understood it and I understood its reach. The Great Investec Epsom Derby, as it used to be referred to, targeted exactly what our client targeting was in the UK and it gave us a superb position. It’s most probably the biggest single event in the UK calendar and beamed to (I don’t know) 50, 60 countries around the world. 

So, for the relative price – it was strategically something we could afford and couldn’t afford to say no to. At the time we started it was 500,000 pounds, which really, when you think of the reach, it’s quite incredible that you have this little South African bank (in those days) that was able to project its image and its name to a global audience. 

Sadly, that is not the view anymore. And I believe that we no longer are the sponsors of the Epsom Derby. But look, you know, these decisions in a different world are very difficult. And I think for the 10 years that we had it – I thought it brought huge value to their branding and to the recognition of the zebra splashed across the world! 

The iconic Investec zebra

Alec Hogg: Where did the zebra come from? That’s another question from Kwambile Dwai. 

Bernard Kantor: Thanks to our friend, Mr van Niekerk. It’s just unfortunate that when (Raymond) came to the UK he was unhappy about our positioning and our brand and said we have to do something different. Anyway, I’ll cut a long story short: a local agency came to him and in turn he came to me and he showed me the zebra. I said: Raymond, you’re wasting my time. Please, just outta here. I’m too busy. We want to get away from looking like a South African organisation. 

Anyway, he came back and back and back and the last time he came back, he came with a zebra pushing in a scrum, a zebra with with wicket-keeper gloves on – all sorts of weird and wonderful things that the zebra could do. I went to the board and they said: listen, young man – we pay you to take those decisions. And I said alright, well maybe we’ll give it a try. And that’s how it became. To his great credit – he persevered. And it’s taken us to many places. 

Stephen Koseff: That’s mostly, right. But he brought it to our executive committee and they were saying to him: Raymond, why don’t we have a leopard, you know, a resilient animal. Why a zebra? And then he explained to me that a leopard is a loner, whereas a zebra is a community animal, it has shades of black and white and reflects South Africa, it’s an African horse. And we said: Ok, we’ll launch it only in the UK. 

I kept thinking about the kwagga that Petroleum used – it was always dirty, that kwagga. So, eventually it worked so well – we got letters from mothers saying: Can I have posters of the zebra, can I have zebra dolls and all sorts of stuff – that we brought it back to South Africa and it’s worked exceptionally well for us. Bernard’s story is 100% – we weren’t that keen on it in the beginning, but the process took us to the right answer.

Ian Kantor: If I may just quickly: I hated the zebra. Couldn’t stand it. I love it! So, you never know what’s right or wrong. The one point that I do want to make though is when we started Investec: anybody you spoke to or went to, they said ‘Who?’ In South Africa it was extremely difficult to build any kind of name awareness. However difficult it was in South Africa – I said never again. 

Building Investec in London – in any immigrant environment – is 10 times more difficult. You don’t know the rules. You don’t understand the culture. You don’t understand the language. So, I think that the extent to which you would be able to build a franchise – and it was, we understood that you need a franchise, people deal with a franchise – you need to substantiate it, you need to perpetuate it. It’s the franchise that actually does a lot of the business for you. 

And so building the franchise is fundamental and I think that the degree to which we have built a franchise in a very foreign place that is not the same. They may speak English, but it’s foreign, it’s different. We are foreign but Investec will stand in the years to come in very good stead. 

*Sign up for BizNews Thursday noon webinars where you get a chance to ping questions at high profile guests.
https://attendee.gotowebinar.com/register/1324111475714234383

Visited 3,395 times, 1 visit(s) today