Revisiting “Shame on you, Mark Shuttleworth” 13 years later

Mark Shuttleworth has a lot in common with lottery winners: his attitude shifted quickly after coming into money fast.
Mark Shuttleworth has a lot in common with lottery winners: his attitude shifted quickly after coming into money fast.

By my calculations, I’ve written something approaching 15 000 articles in three decades as a journalist. Of those, only a few stay fresh in the memory because of the reaction they generated. This piece, written almost 13 years ago, was easily the most commented-on article during my 15 year custodianship of Moneyweb. I’m still not sure if the concerted attacks were generated by the Mark Shuttleworth media machine or what must otherwise have been an army of fans. Colleague Jackie Cameron’s excellent piece this week about changes that happen to those who come into big money reminded me of it. Even with the exact science of hindsight, there are sure to be different opinions about the views expressed here. – AH      

By Alec Hogg

If the way one handles money is the measure of a man, Bellville’s IT whizz-kid Mark Shuttleworth ranks right down there with former South African cricket captain Hansie Cronje. The manner in which greenbacks corrupted his spirit may have been subtler, but like the disgraced cricketer, it’s been effective.

Many people have emigrated from South Africa. You might not agree with their reasons, but until you’ve walked the proverbial mile in their shoes it’s not fair to criticise. But that’s very different to a public persona like Shuttleworth shamelessly using a mass-market newspaper to justify a decision so obviously motivated by hubris.

At the beginning of last year, when Shuttleworth burst into prominence after selling his 37-person Internet business to the United States’s Verisign for $575-million, he was proclaimed a national hero. The then 26-year-old was hailed as every bit a role model of what can be achieved by the pioneering South African spirit in the New Age economy. Anyone reading last week’s piece entitled “Why I simply had to go” by a fawning Sunday Times, can only marvel at the Capetonian’s transformation into much of what epitomises the Ugly Face of Capitalism.

The transcript of a radio interview I conducted with Shuttleworth on January 4 last year, soon after the sale of his Thawte Computing was announced, emphasises the 180 turning of a gent who famously preferred shorts and flip-flops to the black Armani suits he appears to favour today.

Hogg: Are you bringing all the money back to South Africa?

Shuttleworth: Absolutely.

Hogg: What are you going to be doing?

Shuttleworth: Build something of a Silicon Valley here in South Africa.

Hogg: Starting new businesses?

Shuttleworth: There’s too much of an asset base to dump into one venture. Something like this affects the whole country.

Hogg: Ever thought of emigrating?

Shuttleworth: Sure … it was something of a dawning realisation for me to look at those places [the US and Europe] and say, well, the only thing we lack [in South Africa] is the confidence to achieve the same success.

And when asked why he’d be prepared to tie up so much capital in one country, Shuttleworth could hardly contain himself: “Oh wow. It’s a phenomenally low-cost place to produce high-intellectual, capital goods. We’ve got great people. Then there’s the quality of life. I’ve been lucky enough to travel a lot over the past two years and I’ve yet to find a place to match up to South Africa. I hope more and more people realise that and turn negativity into a sort of positive feeling that this is the place to start Internet businesses.”

It gets better. In our discussion Shuttleworth attacked financial advisers “that have been quick to suggest that we should try to keep the majority [of his cash from the deal] offshore. That’s a very negative approach, an approach built on fear.”

On the same lines he said: “There’s this accepted wisdom in the mahogany corridors that it’s safer offshore and all sorts of suggestions that this can be done. Frankly, I find that the wrong approach. I’m much more enamoured with people who have said that there are opportunities here and how can we work together to capitalise on them?”

Seventeen months later the same human being is bleating about being forced to emigrate to London because the Reserve Bank refused his request to move funds offshore.

Again a direct quote from the Sunday Times article: “It was brutal. The rejection [by the Reserve Bank] put me in an impossible situation. It makes no sense to put all your assets in one country. You need to spread your investments.”

Ahem. Easy to see who won the day after those “biggest South African financial institutions” he was once so critical of, got their hooks into the 27-year-old. Of course everyone is entitled to change his or her mind.

Even though Shuttleworth’s transformation means an opportunity has been lost, the rest of us will get along fine. Still, that $575-million translates into more than R4,6-billion at the current exchange rate. That kind of money would have gone a long way towards creating the South African Silicon Valley that Shuttleworth used to dream of. Now he wants it tied up in First World share certificates and foreign bank vaults.

Perhaps the biggest tragedy is the personal one. New-model Shuttleworth in his new world of extreme wealth is seemingly oblivious to the broader consequences of his actions. That he has completely lost perspective is reflected in his statement to the reporter that to entrepreneurs the country’s foreign exchange control laws “feel similar to what pass laws felt like to black South Africans”. Hello?

Plus, his future travels will include trips to African countries “so that I can be more qualified as a representative of Africa at global initiatives”. In the same breath he tells the reporter how from December he’ll be travelling in his own $50-million Bombardier Global Express aircraft and muses that he’s not made up his mind whether he’d be flying to London or Russia today.

This from a man who has departed the country he loved for “financially motivated” reasons. You’ve got to wonder how much money will be enough.

I wouldn’t want the person Shuttleworth has become to represent my country at a local agricultural show, let alone on a global platform. Would you?

Shame on you Mark Shuttleworth! Shame.

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