Breaking News: Five People to Watch
The BRICS countries are likely to be more noteworthy than ever before in 2015. In part, this is due to the scope of joint projects the five countries are taking on, but it is also thanks to the ambitions of BRICS businessmen and politicians. In addition to the heads of state that will be in the public eye this year, BRICS Business Magazine has identified this year’s news making entrepreneurs.
An unprecedented drop in oil prices, galloping inflation, unmanageable foreign debt, severe economic depression, and an all-out crisis of credibility – this was the situation that the Russian economy was facing in early 2000 during the first year of Vladimir Putin’s presidency. The situation demanded urgent government action and, as subsequent events show, the program of liberal economic reforms that was launched in response proved spectacularly successful. It helped to transition the Russian economy to fundamental market principles and ensured high economic growth for an entire decade.
Herman Gref, one of the most successful Russian reformers and the program’s chief architect, received well-deserved recognition for these accomplishments. His reforms brought radical improvements to businesses and transformed a local retail bank into an international financial corporation. Since 2007, Gref has been CEO and Chairman of the Executive Board at Sberbank.
Even though the initial objective of doubling the bank’s capitalization in five years did not materialize, Gref was not personally responsible for that. Sberbank’s steady drive to achieve these targets was hampered by empirical circumstances – the global crisis of 2008, which hit the Russian financial system and banks particularly hard and gave way to a full-scale recession in 2014.
It is not difficult to see that the circumstances that the Russian government is forced to operate in today are similar to those seen at the beginning of the last decade – economic activity has slowed markedly, inflation is accelerating radically, and the ruble is losing its value in an unprecedented fashion due to rapidly deteriorating commodities markets and Western sanctions. Still, Gref insists that the roots of today’s economic difficulties come not from external pressures, but lie in the lack of structural reforms that the country needs now as badly as it did 15 years ago. “The sanctions exacerbated a negative situation, but let us not blame everything on the sanctions. We have a great deal of our own problems and we would have faced zero or negative growth next year anyway. That is why the fault lies with us and not in the sanctions,” Gref said during a meeting on energy issues held at the Civic Chamber in early December. “Macroeconomics tend to be very prone to inertia – first it takes a long time to ‘boot up,’ and then at least as long to steer it onto the right track.”
Gref may have to tackle an unenviable situation once again. If Dmitry Medvedev’s government resigns, a possibility that experts have already been seriously considering for months, the former Minister of Economic Development and Trade appears to be a likely candidate for the new, reform-oriented cabinet.
The probability of this scenario becomes even greater if we take into account the fact that Gref’s four-year mandate as CEO at Sberbank will come to an end in November 2015, and that President Putin’s pool of eligible candidates is extremely limited.
Lei JunForbes Asia recently named 45-year old Lei Jun the Businessman of the Year. The title is well deserved – in the summer of 2014, the company that Lei set up just four years ago, Xiaomi Tech, became the world’s third largest distributor of smartphones. But the man who is often referred to as the ‘Chinese Steve Jobs’ is still planning to conquer the European and US markets, and even wants to throw down the gauntlet with Apple.
“No one thought the Xiaomi from three years ago, which had just made its first phone, would later rank as the third largest player. We have the opportunity to become the number one smartphone company in the world within the next five to ten years,” Lei said in his address at the World Internet Conference in November in Wuzhen.
Xiaomi Tech sold 19 million smartphones in 2013 and is likely to sell an estimated 60 million in 2014. Lei Jun, the company’s CEO, admits that his next objective is to sell 100 million devices in 2015. A new model called the MI5, complete with a 5.7-inch screen, should help him in his ‘gadget’ expansion drive. Its expected release date is in January 2015.
When Lei Jun set up Xiaomi Tech in April 2010, he was already known in China as a business ‘angel’ of sorts who invested in start-ups, yet he never attained the reputation of a magnate. After graduating from Wuhan University, Lei was hired by Kingsoft in 1998. The software company is widely known today, but few people had heard of it back then. In many ways, Kingsoft’s rise was made possible by Lei’s organizational talents. He was certain that the future belonged to mobile internet, which is why he decided to create Xiaomi.
As Lei points out, one of the secrets to his success is an open client communication strategy. He claims that his company does not treat its customers as buyers, but rather as “friends with whom it can discuss new ideas.” For instance, in 2012, Xiaomi gathered 1,200 of its fans and gave them a chance to test its new smartphone, the Mi2. The company also lets its clients customize its products as they see fit – they can modify the software, change the battery, and do much more. Even Xiaomi’s slogan conveys the same message: ‘Just for fans!’
No one thought the Xiaomi from three years ago, which had just made its first phone, would later rank as the third largest player. We have the opportunity to become the number one smartphone company in the world within the next five to ten years
The Indian economy is readying itself for a dash in 2015 – the country’s new Prime Minister, Narendra Modi, plans to introduce explosive economic growth. The Adani Group is also getting ready to embrace the boom, and its founder and CEO, Gautam Adani, is considered to be a close aid to the head of state – he was a big supporter of the new Prime Minister’s election campaign. It is no coincidence that the news of Modi’s victory drove Adani Group’s shares up by 85%.
Today the group is expanding its sphere of influence far beyond India. In November, the Adani Group signed a loan agreement with India’s State Bank for $1 billion. This money is supposed to help Gautam Adani implement a coal production project in Australia. Even though the reactions from Down Under were mixed, the work is still scheduled to begin in 2015.
Both Adani and Prime Minister Modi come from the northwestern state of Gujarat and have known each other for a long time. In general, natives of Gujarat are believed to be very industrious, business-savvy people. Even among the people of Gujarat, Gautam Adani enjoys the reputation of a great businessman. He is called the ‘Keeper of the Gate’ to northwestern India because the Adani Group controls the Port of Mundra, the largest private harbor in the country. In addition, Adani Group also dabbles in logistics, food oils, and agricultural produce, as well as power plants and coal mines.
The owner can hardly be called a typical businessman. While other Indian entrepreneurs prefer to bet heavily on information technologies, software, or try to conquer the market with new gadgets, Adani chooses major ‘traditional infrastructure’ facilities. These include ports, power plants, and power lines. Obviously, he picked his targets well – today Adani’s personal wealth is estimated at $7.1 billion.
“The infrastructure sector is all about building assets for the country. It is part of nation building. Our country’s infrastructure requirement is huge – be it ports, power plants, transmission lines, or mining. We started our journey with ports and went into power, transmission lines, and mining,” Adani explained in an interview with Outlook magazine.
His friends are convinced that he enjoys risks in business, yet his intuition is legendary. He always seems to sense how far he can go in any business, which is why he always ends up making a profit.
The infrastructure sector is all about building assets for the country. It is part of nation building. Our country’s infrastructure requirement is huge
In the 19th century, prospectors described platinum as ‘a white and willful metal.’ This year, the metal’s whimsical nature struck again. South Africa’s platinum industry was hit by an unprecedented strike that lasted five months, and now mining company CEOs are looking forward to 2015, a time when they hope they can put their troubles behind them. One of those CEOs is Africa’s first black billionaire and the head of African Rainbow Minerals (ARM), Patrice Motsepe.
The platinum strike that began in February 2014 caused Motsepe, who was the richest man in South Africa in 2012, to drop to fifth place in the rankings. However, in recent months, ARM has produced decent results. In addition to platinum, the company also mines copper, iron, and gold.
The entire country is closely following Motsepe’s successes and failures – the indigenous billionaire is a major celebrity in South Africa on par with movie stars and football legends. Few businessmen in the world enjoy the same level of popularity – many South Africans dream of getting Mostepe’s autograph or taking a selfie with him. Various publications continue to name ARM’s CEO the most influential entrepreneur in Africa, while Forbes magazine simply included him on their list of large fortune-holders.
Motsepe’s weakness is football, which would explain why he owns the Mamelodi Sundowns, a football club that plays in the Premiere Soccer League. In addition, he is known for his charitable contributions. The African magnate responded to Bill Gates’ and Warren Buffet’s call to join The Giving Pledge, and he has already committed to donate half of his fortune to various charities.
“It’s a recognition that people in my position, and me in particular, have a huge responsibility to South Africans who are less fortunate – those who are unemployed, poor, and marginalized – and to make a humble contribution to improve their lives and living conditions,” Motsepe was quoted as saying.
The billionaire himself leads a very modest life. Though he lives in a nice house, it is not a palace by any stretch of the imagination. He is also not eager to talk to the press, and rarely agrees to interviews.
It’s a recognition that people in my position, and me in particular, have a huge responsibility to South Africans who are less fortunate – those who are unemployed, poor, and marginalized
What qualifies as an American lunch? Many think a hamburger from Burger King is mandatory, and that it should be doused with Heinz Ketchup and accompanied by a glass of beer – a Budweiser, let’s say. But today, this kind of lunch does not entirely qualify as American. For several years, all of these brands have been owned by an investment fund called 3G Capital. The ideologist behind the fund is Jorge Paulo Lemann, a Brazilian billionaire.
Business journals in the Americas are abuzz with the news that the billionaire and his partners may take a stab at the Holy of Holies and acquire the legendary Coca-Cola brand in the coming year. If this happens, Lemann and his partners Marcel Herrmann Telles and Carlos Alberto Sicupira will be the kings of American fast food. It is hard to imagine an American meal without at least one of these brands.
When Jorge Lemann – who comes from a struggling family of Swiss immigrants – began his career, it was difficult to predict that he was on his way to becoming the richest man in Brazil. His net worth is currently estimated at $23 billion, but as a young man, Jorge preferred tennis and surfing. He even took part in the Wimbledon Championships and the Davis Cup, and as a student at university, he was rarely found without his surfboard. His family sent him to Harvard, but he quickly tired of studying and decided to go home. It was only thanks to pressure from his parents that he managed to complete his Bachelor’s degree. Even then, he devised a system to complete the four-year program in just three years.
Lemann did not think he needed boring lectures to do business as long as he had the talent and drive. Soon enough, the young graduate went into business and never looked back – all the while continuing to play tennis. In 1971, he founded Garantia, an investment bank that later became the cornerstone of his empire. The billionaire always claims that the most important thing for him is not the profit but the business itself.
“Money is simply a way of measuring if the business is going well or not, but money in and of itself doesn’t fascinate me,” he was quoted as saying in an interview.
Rumor has it that Lemann never eats or drinks his famous products, and that he steers clear of hamburgers, mayonnaise, and beer. Instead, he prefers healthy food and still plays tennis every morning.
Money is simply a way of measuring if the business is going well or not, but money in and of itself doesn’t fascinate me