Eben Klynsmith

Welcome

About Me

LONG-TERM GOAL: ACCOMPLISHED SPECIALIST IN BUSINESS MANAGEMENT

From my first days at university my goal was to be an accomplished specialist in the combination of asset management, investment banking and management consulting and hence, right from the start, I made sure I studied for and was awarded the CFA charter.

My plan to achieve this goal of becoming a specialist was to acquire, at least in my mind, all the key building blocks that would set me apart from others competing in the same space. This road was full of surprising, supremely enjoyable and mentally stimulating experiences and it certainly took some time along the journey.

The building blocks:

I believed I needed core skills that had to include:

Numbers:

preparing and analysing financial statements, intensive valuation, modelling and analytical skills

Business savvy:

having created and built large subsidiaries & divisions to learn the soft skills, the art of building businesses

Processes:

understanding the regulatory framework of the debt markets and stock exchanges, and the practical side of implementing transactions – circulars and bid mechanics and

Strategy and value unlocking

consolidating and building businesses and unlocking value whether through restructuring or incentives; creating great portfolios.

These four areas I thought were crucial to have the comprehensive understanding required to become the specialist I aimed to be, yet, I viewed these as mere building blocks, the true test would be to ultimately combine these into one enjoyable and competitive role.

My Path

To gain these skill sets I identified I was fortunate enough to be able to check them off sequentially.

Numbers:

Immediately after university I was hired by Stern Stewart & Co. In my view they were at the time THE valuation experts on Wall Street as their founder Prof Joel Stern was the inventor of Economic Value Added (EVA) and also the inventor of the phrase “discounted cash flow” – the first use which was in his 1974 Financial Analyst Journal paper called “Earnings Per Share Don’t Count”. The intense analytical skills they required in understanding the value drivers of a business and its financial modelling in Excel was fundamental to my understanding of the economics of a business. It was fantastic to see this value mind-set being implemented from the US to South Africa, Singapore and India.

Business savvy:

After four years with Stern Stewart & Co., rather than telling others how to improve their businesses, I wanted to see if I could create and build a business. Directly after the collapse of the IT bubble – perhaps a crazy time to do so – as CFO I created an opportunity to form M-IT, an IT services business, as a new subsidiary for Africa’s largest IT group at that time: Dimension Data. We diligently executed the plan and grew the firm to a 300-person strong team in three years; becoming self-funding by its second year of operation, being chosen as Hewlett Packard’s sole onsite support partner in the country and winning 1st place in the prestigious “Top Black ICT Company” category in the Forge Ahead BMI-T African Achievers. By 2009 the division had 1,000 people. During these years I learned the soft skills that managers can only learn hands on. To this end I do not think I could have learned negotiations, closing a sale, squeezing profits or incentivising staff any better through any other experience.

Processes:

Having acquired analytical skills and building whole business divisions from scratch, I felt I still lacked the formal skill sets of understanding regulatory processes. Sasfin Capital, a division of Sasfin Bank, invited me into their corporate finance team, enabling me to learn these skills including passing the JSE Approved Executive exams. During the next two years our corporate finance team which comprised only six people, completed such a high volume of transactions inception to conclusion as JSE sponsor and advisor that we came third in South Africa in the Dealmakers of the Year Awards for sponsor activity during 2009 and 2010; while large competing firms had teams larger than 20 members. All along learning about the JSE, the SRP and the Competition Commission as well as dual-listing requirements in other jurisdictions such as Canada, Australia and the UK. I was also able to continue my company valuation skills being appointed as the bank’s leading Schedule 5 valuer.

Strategy and value unlocking

Throughout my career and mainly from the past seven years again with Joel, but this time in his new business Stern Solutions Capital Partners (SSCP) I advised firms on 6 continents in countries as diverse as Guatemala and Mexico to mainland China. The insight I gained from seeing business strategies, tactics and processes fail and succeed in so many different countries and types of firms has to date been my most valuable reward.

LUCKY TO HAVE GREAT MENTORS

Lucky to have great mentors

I have been fortunate to learn from many mentors and teachers. For example:

Joel M. Stern the inventor of Economic Value Added (EVA) and the first person to ever use the phrase “discounted cash flow” in a paper he wrote in 1974 titled Earnings Per Share Don’t Count. Others included a number of Joel’s associates such as
Stewart C. Meyers, Robert C. Merton Professor of Financial Economics at the MIT Sloan School of Management
Michael C. Jensen, Harvard University and founder of Agency Theory and the economics of ethics, and
Myron Scholes, inventor of Black-Scholes option pricing

It was a dream come true to spend hours during one-on-one Skype calls with Myron Scholes brainstorming whether Africa could do with a commodity exchange or whether a new metric to standardise diamond trading instruments has merit. These mentors and teachers have made an indelible impact on my life and I try to do the same for mentees/juniors under my wing.

Life is about constant learning and following one’s passion.

WE HAVE YOUR BEST INTEREST IN MIND!

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