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Shaka Kariuki: Businessman who buys companies

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Shaka Kariuki: Businessman who buys companies


Shaka Kariuki, Co-CEO Kuramo Capital Management. NMG PHOTO

Shaka Kariuki’s achievements are in no order of importance: one of the founders and co-CEO, of Kuramo Capital, chairman of TransCentury, GenSAfrica vice chairman, Sterling Capital vice chairman, executive chairman of NAS Foods, board member of Leon Business Solutions in Zimbabwe, Solo and Viathan in Nigeria, Sepfluor in South Africa and Marriott School of Management at Brigham Young University in the US.

He has been a tout. He has participated in the Ballroom Championships — the Olympics of ballroom dancing. He still dances, sometimes alone.

He dirtbikes mountains or climbs them. He has gone to acting school and appeared in some movies in Hollywood. He modelled briefly. He jogs most mornings. He has raised children — still does. Does it stop?

And Shaka shows up for interviews bang on time.

***

Shaka. Is that from Shaka Zulu?

It is. There are only two places in the world where I get a lot of questions about it – South Africa because of Shaka Zulu and Hawaii. Hawaii they say Shaka, for hang loose. In the US, there was only one other Shaka that I knew of who worked for JP Morgan.

It’s a big name, I always wonder why not more people are named Shaka. Of course, there is Shaka who works for Safaricom…

So if you were to tell your grandmother what you do for a living, what would you tell her?

That’s a good question. (Chuckles) My grandmother, may her soul rest in peace…I’d tell her that I buy companies or invest in companies, and then I try and grow those companies and take them to the next stage. In the process of doing that, I impact the lives of the individuals that are working in those companies. Hopefully in a positive way. I’m in a win-win game.

What makes you invest in one company and not the other?

Usually, I look at management. I also ask the question; is there a market for whatever they’re selling? Lastly, do we have governance? And if those three are in place, then for the most part you’ll be able to take the company to the next level. Because usually if one of those is not working then the company might often struggle.

When did you realise you were into this sort of thing?

From when I was a child. I’ll tell you a story. One time I was driving with my dad, while I was in primary school.

My dad pointed at a discarded carton of milk on the side of the road. One of those square things from back in the day.

He told me, “There are people who are going to walk by here or drive by here, and will look at that carton of milk and see garbage or an opportunity to transform it into something profitable.” That just stuck with me.

So from back then, I always asked myself; how can I look at things and see opportunity? I started investing in treasury bills as a child, of course through him. When I graduated I had enough money.

My mom was a paediatrician and when we left home she would use her car as a matatu to ferry people to Kenyatta National Hospital.

She’d say, ‘if you want to make extra cash you have to be the turnboy.’ So I was her tout, calling on people to enter her car. In that regard, I have always been around enterprise from a very early age.

Do you see yourself as a businessman or a corporate man?

I’m a businessman. I enjoy interacting with people. Covid-19 was not good for me in terms of being on Zoom calls and all that kind of stuff. I love shaking everybody’s hands, for example.

I’m the guy who is always shaking people’s hands. When you shake people’s hands you connect with them. It just tells people that you actually appreciate the person.

 When you shake their hands, you tell them they’re important and appreciate them.

Are you a better human after Covid?

Absolutely. No question there. I guess I appreciate life more which means I appreciate people more. I don’t take things as seriously as I used to before, although that could also be a factor of age. The older you get, the more you realise it’s nothing as serious as people take it to be. Sometimes we complicate it too much.

What have you learnt about money over the years?

Well, that’s a good question. I came to realise a long time ago that money for the most part is just numbers. And I had the fortune in the US of managing, running huge portfolios, private and public equity.

We are talking Sh7 billion. Every day I’d be either doing trades or buying companies. You could do trades of even $500,000 or even more.

You’d be on the phone saying ‘can I buy $100 million of JP Morgan…’ You end up dealing with such huge numbers after a while you realise it’s just zeros after a number when it comes right down to it.

So whether you’re dealing with many zeros or few zeros, the decision-making to me should be the same.

So whether I’m thinking of buying a car or somebody at a huge firm is thinking of making huge deals, to me, the decision process is always the same.

So it doesn’t matter how much money you have.

Does it also sort of change your interaction with your own money when money is just zeros at the end?

There’s money, then there’s what’s behind the money. (Chuckles) Those are two different things. When you start asking yourself what the impact of money is; that’s a whole other conversation.

If I’m buying JP Morgan bonds, and I’m buying Microsoft stock or whatever the case may be, that money is no longer zeros, that money represents the hard work of a janitor at the University of Minnesota.

He works hard for it and he needs returns. We manage a lot of pension funds in this country and I always tell the team, yes we’re making these big decisions, but now that money represents somebody’s hard-earned living. So now at that point, the decision is very different.

If I go buy a mojito, I’m asking myself, should that mojito come with ice or should I order ice on the side?

Because if it comes with the ice, 25 per cent of the mojito is already taken over by the ice. So I’m better off getting the ice on the side and the mojito separate. (Chuckles)

Is that your drink of choice?

A virgin mojito. I don’t drink, nor do I smoke. I’m a teetotaler. I’ve never drunk. My grandmother drank Tusker and during Christmas, she’d give us a tryout.

I’ve seen what alcohol does to people around me, so it’s something that I never took up.

What sort of impurities do you put in your body…surely, a man has to put something unhealthy in him…

[Laughs] I wouldn’t say I’m pure. But I enjoy jogging and mountain climbing. I have climbed Mt Kilimanjaro, Mt Diablo in California, and I’ve run a few marathons. I love riding motorcycles, the Honda 250 dirtbikes that I use to climb hills. And I love to dance. I really do.

Are you a good dancer?

People say I am.

Do you think you’re a good dancer?

Let’s put it this way, even when I was young, my grandmother used to call her lady friends so that I could dance for them. [Laughter] I actually participated in the ballroom championship in 1995, which is like the Olympics of ballroom dancing.

I did the Chacha division. I used to be very good back in the day. At some point in my life, I did modelling. I went to acting school and I acted at some point in my life.

I don’t do it anymore. I’ve done a few movies, I have been in Stephen King’s adaptation movies, an NBC movie of the week in the US, and appeared in a couple of documentaries.

Going to acting school was very interesting. You are taught all these techniques, for instance being able to cry on the spot.

Have you used that talent before in real life?

Which one?

Cry on cue?

No. (Laughter) I’ve never had the opportunity to use it.

Of all these things you’ve mentioned, which one makes you the most alive?

I’d say dancing. And the reason for dancing is because I do it every week, even today. I go dancing every week, from Nigerian music to Mugiithi, I love them all. I am very comfortable going dancing alone and dancing by myself if my wife doesn’t feel like it.

People like dancing with good dancers, so if you go by yourself of course you attract people to dance with. Nobody wants to dance with somebody who doesn’t know how to dance.

(Laughter) Although if you’re too good, nobody wants to dance with you. That’s the other part. You intimidate them.

Have any of your children taken after you in the arts?

I think so. My older son and my daughter are very artistic. They play the trumpet. They’ve performed all over the world, in countries that I’ve never been to.

The band they belonged to —Crescent Super Band — performed in Cuba, for example, before even Cuba was open for business. They’ve performed at the Apollo Theatre and all over Europe.

So they’ve taken it to a whole different level. They’re still good players. Even here at Riara School, they came and started a whole band section for that school. They interacted with children there for many years when they were younger. Now they are 25 and 20 years old.

What’s your risk appetite for business like?

It’s on the higher end relative to most people. They say great risk comes with great reward but most of the time it goes the other way. We saw this during the recession or market downtime when you see some decisions you’ve made get washed away very quickly.

So there are times when regardless of the great decisions you have made the market is still against you. For me, it’s never necessarily a bad thing because the question I always ask is have you followed the process?

They say money follows the money. Is it true?

Not to me. Money follows opportunity. People say they have great ideas but they don’t have the money. If an idea is that good, trust me, you’ll always find the money. For money to grow, it has to have an opportunity to grow. Otherwise, how are you gonna grow the money?

What’s the best thing you’ve ever invested in?

I’ll say, my family. Ultimately that’s where the rubber meets the road. When it comes right down to it, everything else is neither here nor there at the end of the day. And that’s the beauty of living long enough. As you get older you realise that some of these things will go away at the end of the day. And most things are replaceable. If Shaka is not here tomorrow, the investments will still go on.

Are education qualifications very important in running businesses?

No, they are not. I’m not saying they’re not important to have, because they do open doors for you, especially early on in your career.

But are they important to run businesses? Why should they be important? You have 20-year-olds running multi-billion organisations without any papers.

Those businesses are doing just fine. Are they important for politics? They’re not. Why should they be? It’s about the individual and experiences and what value they have and what they’re bringing to the table.

How happy are you currently, on a scale of one to ten?

I’d say 11. Very happy.

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