Some of the companies which Vodacom invested in accused the operator of not providing the support promised, and reneging on its side of the partnership.
The former Gogga Connect CEO, a company in which Vodacom had a stake, went further and accused the mobile giant of being “100% responsible for killing Gogga”.
This raises the question how Vodacom performed when looking at a wide range of its investments, which include operational investments and higher risk ventures.
According to information gathered from Vodacom’s annual reports and industry sources Vodacom does not have a great investment track record.
The following table provides an overview of many of Vodacom’s investments over the last few years.
|Company||Reason for investment||Date (approximate)||Status|
|Xlink Communications (Pty) Ltd (75% plus control)||Venture||November 2007||Still invested|
|G-Mobile Holdings Ltd||Venture||September 2007||Still invested|
|Stortech (75% plus control)||Venture||February 2009||Still invested|
|Afrigis||Venture||July 2009||Still invested|
|Gogga Tracking Solutions (Pty) Ltd||Venture||During 2007||Exited|
|WBS Holdings (Pty) Ltd t/a iBurst||Venture||October 2007||Exited|
|Westside Trading 163 (Pty) Ltd t/a Vodacom Gated Services||Venture||Mid 2008||Exited|
|Zoopy (Pty) Ltd||Venture||June 2008||Still invested, Vodacom looking to exit|
|The Grid (Division of Vodacom)||Created by Vodacom||During 2007||Closed|
|Other operational and regulatory investment|
|Smartphone SP (Pty) Ltd||Operational||August 2007||Still invested|
|Waterberg Lodge (Pty) Ltd||Operational||During 2008||Still invested|
|Vodacom Converged Solutions (Division of Vodacom)||Operational||During 2007||Still invested|
|Wheatfields Investments 276 (Pty) Ltd||Holding treasury shares on behalf of the Group||November 2009||Still invested|
|National Porting Company (Pty) Ltd||Requirement by ICASA – MTN and CellC other shareholders with equal share||August 2007||Still invested|
|Africell Cellular Services (Pty) Ltd||Operational||October 2006||Amalgamated into VSP|
Feedback from companies in which Vodacom invested
The feedback from the companies in which Vodacom invested and holds a stake was mixed. Many of these companies would not comment on their relationship with Vodacom.
Xlink said that they would prefer not to comment on whether the Vodacom investment helped the company and whether it worked out as they expected.
Zoopy founder and former CEO Jason Elk said that he has moved on and would rather not comment on the past [hence Vodacom’s investment in Zoopy and whether Vodacom stuck to its end of the bargain].
AfriGIS and Stortech – which recently announced that its CEO Tim Knowles had resigned – also did not comment on Vodacom’s shareholding in the company.
Googa Connect’s former CEO Eugene Beetge was less diplomatic, saying that Vodacom did not support Gogga as agreed. “The original deal was loosely based on a verbal agreement with everything in e-mail. This was all thrown aside when it didn’t suit Vodacom Service Provider’s model,” said Beetge.
Beetge added that Vodacom was “100% responsible for killing Gogga.” He said it was not a good period in his life, fighting against what he once believed could have been a good partnership.
“We have invested more than 30 million rand in our billing engine to cater for our own as well as Vodacom Wi-Fi needs,” said van der Merwe.
He added that Wireless G’s recipe for success with the partnership with Vodacom is to gain top level support in Vodacom, but to stay focused on execution.