Mike Buckham: From accounting anti-hero to Sygnia FD
Mike Buckham shares the story of his unusual and unexpected ascent to Sygnia FD.
The sun had set in Panama’s Darién rainforest, the wild and infamous home of armed Colombian rebels, drug traffickers, blood-sucking bats, poison-dart frogs and more than 500 bird species. Mike Buckham had retired to his luxury tent after several adrenaline-filled days of chasing toucans, hummingbirds and the much-prized harpy eagle. Then a message found its way from a cell phone mast in Cape Town to the roadless wilderness that forms the missing link of the Pan American Highway: do you want to become financial director of Sygnia?
Even when giving Mike Buckham full points for self-deprecation and modesty, his ascent to finance leader of one of South Africa’s sexiest brands has been unusual and unexpected. As close to an accounting anti-hero as you will encounter in an FD role, Mike recalls failing accounting at university, being too risk-averse for the investment world, too snobbish to make the most of auditing articles, struggling to access the job market, rolling from one career-related disaster into the other - before finally making a mark at Prescient, where he guided a complicated reverse-takeover and then a delisting.
“You don’t learn nearly as much when things are going well,” observes Mike with his typical mix of dry insight, smart humour and personal warmth. This is a story of a finance boss who thrives off the beaten track, whether he is out birdwatching or navigating the boardroom jungles of the financial services sector. Significantly, this is a story of a Joburg-born Capetonian who also became responsible for HR at both Prescient and now at asset manager Sygnia, testimony to the fact that his skills lie as much in his human touch as in his knack for numbers.
When now-prominent Sygnia CEO Magda Wierzycka was looking for a wingman who could free her up to be (even) more strategic and visionary, she needed someone a little out of the ordinary. Someone with a track record of successfully enabling entrepreneurial CEOs.
That’s where Mike came in. Throughout his career, he has worked with, tolerated, survived and assisted a broad variety of big bosses. “There are only two types of entrepreneurial CEOs,” observes Mike. “Some are very difficult and successful. Some are very difficult and not successful.”
What makes Mike so well-suited to working with entrepreneurial CEOs? His schooling was privileged, but conventional. The younger Mike was good at maths but didn’t even do accounting at school. Educated at the prestigious King David Schools and St Stithians College in Johannesburg, he discarded the idea of becoming an architect and decided to “study something more practical”. He enrolled for an undergrad degree at the University of Cape Town, eventually majoring in finance and accounting.
Only during his second year in the Cape, did Mike attend his first-ever accounting classes – and he was baffled.
“I found it to be a different language and half a year through it, I was failing badly. Then the panic set in: I had a plan for my career, but my grades were in the 30s, even though I was good with numbers. Only when I did extra lessons and had the principles of accounting drilled into me did it finally click.”
Most current high-fliers in asset management are natural accounting buffs with an instinct for investing. Mike was neither, he says. “I never had a passion for investing. Some students and young professionals are always looking for a good share deal. I was much more risk averse.” However, as soon as Mike ‘clicked’, accounting became easy and he passed his board exam straight after university. He then set out to become a proper suit-and-tie office man. “I hated my article days, doing audits in a factory in Epping or some other godforsaken place.”
Post articles, Mike, and his young wife Jean, travelled for six months with the aim of slotting in at a big corporate when he returned, aided by a powerful old-boys network., but discovered on his return towards the end of 1999 that the “slotting in” days were over. He dropped his name at agencies, went on rounds of interviews and added Chartered Financial Analyst (CFA) to his CV. “I was not passionate about investment, but I thought that, as I was living in Cape Town, it would increase my chances of getting a good job, as a lot of asset managers are based here.”
He eventually joined pension fund administrator Ten50Six as financial manager, where he found managing director Richard Smith – now COO at Bowmans – as his first mentor. “We had financial constraints and dealt with difficult people and difficult transactions. The company really struggled, and we ended up selling to Glenrand. I learnt a lot about people in this period,” says Mike, who worked hard and picked up some lessons he now regularly passes on to upcoming finance people. “For example, you might think that taking minutes is below you as a CA(SA), but in the early phase of your career this is one of the most valuable things you can do. I did a lot of minute taking those days, which allowed me to absorb the true issues.”
No entrepreneurial CEO is easy, says Mike, but where Richard Smith had been a realistic accountant, the Ten50Six CEO was different. “CEOs are generally salespeople with high energy that are used to having everyone listen to what they say,” says Mike, recounting his experiences. “They live their lives trying to convince other people that they have good ideas.”
With a failing administration transition, clashing cultures and a boss that he could not respect, Mike packed his bags and joined Lion of Africa Life Assurance “desperate to get out”, rather than having a better option. “I ended up working for another entrepreneur who was also full of bluster and no substance. There I was... six years after articles... going from the one disaster to another. I was learning a lot, but my career was going nowhere…”
Things began to fall in place when an old varsity friend invited him to join Prescient Life. Instinctively loyal, he initially said no to the offer, but phoned back 30 seconds later, assumed a compliance and administrative role and was appointed FD of the group after a few months, becoming responsible for the finances of a company of then 40 people, with R40 billion under management.
In 2012, Prescient Holdings listed on the JSE through a reverse listing into PBT Group, which used to be called Prescient Business Technologies. It’s here, in the tangled lianas of corporate finance, that Mike came into his own and the wingman took flight. “It was a radically complicated reverse acquisition. Prescient was worth R1.6 billion at that stage, while PBT was only worth R300 million. We had common shareholders and Prescient founder Herman Steyn had always wanted to list. It was meant to bring synergies and was supposed to be a cleanup exercise to bring shareholders together.”
Mike admits the listing has been termed disastrous by some. He says the performance of the newly listed firm was poor because of the very same expensive derivative structures that had made Prescient successful during the economic downturn of 2008. Now, they were a disadvantage, hurting investment performance in insipid markets. Furthermore, the company was majority-owned by management and because of that “consultants saw the listing as an exit”, recalls Mike.
“We lost R30 billion of assets, because we confused investors and lost credibility because of the complicated construction. I am convinced that if Prescient had listed cleanly in 2005 or 2006, it would have been a success story on the JSE.”
Although it didn’t bring instant riches, the entire operation at Prescient was highly rewarding professionally, says Mike. “It was an amazing time for me. From a small financial manager, I had become an FD of a JSE-listed company. The learning curve was massive. We did financial accounting transactions that were some of most complicated things you will ever see. We had offshore subsidiaries and all sorts of weird and wonderful structures. Never having been a technical accountant, it was difficult and stressful but rewarding to learn.”
In 2016, Stellar Capital knocked on the door and – much to the relief of many – allowed Prescient the opportunity to delist and unwind its complicated reverse acquisition. “I never expected to leave Prescient and had never been approached by anyone. I had worked for Herman for many years. He is an incredibly successful man, smart, but thriving in chaos. He had the ideas, I was responsible for implementation. I saw myself there forever and the acquisition by Stellar was going to be life changing.”
But then came Panama.
The person receiving the message from Magda Wierzycka on that serendipitous evening in the impenetrable rainforest at the southern edge of Central America was not Mike, but his travel companion and birding buddy Simon Peile, Sygnia’s head of investments and husband to Magda.
“My wife had done a Thelma and Louise trip to San Francisco with her sisters in 2016 and my overriding emotion had been one of jealousy,” says Mike, explaining how he – as a father of four – managed to get a ‘pink ticket’ to plan an epic birdwatching trip. Whereas his friend Simon is a well-travelled international birdwatcher who was mainly looking to set eyes on the near-mythical forest hunter, the harpy eagle, for Mike, the opportunity to aim his binoculars and camera at woodcreepers, hummingbirds, toucans and other avian delights was the stuff of dreams. Any neo-tropical birds would do.
After Simon relayed Magda’s message, Mike told him that he was very happy at Prescient, but his friend managed to convince him to meet Magda for coffee. “Only later did I discover that Magda and Simon had discussed me as a potential FD many times prior to that moment.”
Despite the connection through Simon, Mike had never met Magda socially, but he had had an “energised conversation” with her during his time at Prescient. “I remember that conversation well. I was definitely getting kakked on, but it was logical and factual. Just a different opinion.”
Prior to this conversation Mike knew Magda by reputation only. “She was renowned for being very tough. She still is. She survived many difficult things at Coronation and African Harvest.”
One coffee became another. And then a glass of wine. “It was the most difficult decision I have ever had to make. I was deeply involved in the Stellar transaction and Herman had asked me to take over a number of CEO-type roles. I was part of the furniture at Prescient. At the same time, Magda had a reputation for being a tough taskmaster and I didn’t want to work for someone who could make my life a misery. I don’t want them to hear this, but Herman and Magda are actually quite similar in many ways: very smart and very principled.”
One of the biggest pull factors for Mike was getting back on the JSE. “During Prescient’s short period as a listed company, I realised that I really enjoy the structure that comes with listing: deadlines, results every three months come hell or high water, a high degree of transparency. I am a very black-and-white person. There is very little room for manoeuvring, which suits me as I want to present things the way they are.”
In February 2017, Mike joined Sygnia, an innovative FinTech company that provides asset management, stockbroking and administration services, as well as a wide range of savings products, to institutional and retail clients. Sygnia was founded by the wife-and-husband team of Magda and Simon in 2006 and went through a high profile and successful listing in 2015. “Moving to Sygnia was certainly not a financial decision for me,” says Mike. “I definitely looked at it from a long-term career development perspective.”
Since Mike joined, Sygnia has become a different animal because of the prominent role the CEO has started to play in the public discourse about corruption, state capture and white-collar crime. “That was not what I expected when I joined Sygnia,” Mike admits. “The consolidation is ten times easier here compared to Prescient, but there are some other challenging dimensions to the job. Last year’s developments have exposed me to extremely interesting ethical and economic discussions. Sitting in a meeting with Magda is phenomenal. She really is smarter than anyone else in the room. She has a different big idea every three days and she is very good at documenting those ideas in clear and simple language so the rest of us can catch up.”
It could be argued that someone who is lacking Mike’s experience with dynamic, but difficult, entrepreneurs, would have been eaten alive by the Sygnia CEO. “I have started following her on Twitter to get a heads-up,” Mike says with a smile, adding that he has been “very lucky there was value I could add from day one”, with Magda extremely keen to stop worrying about SENS announcements and similar nitty-gritty. “I hit the ground running. On my first day, I was presented with the acquisition of Deutsche Bank's JSE-listed db X-tracker ETFs (exchange traded funds). I am better at that kind of stuff and knowing that I am now on board to take care of these things, has given Magda a lot of freedom to concentrate on strategy. It was great to get stuck in immediately.”
Mike’s most difficult moment has been the firing of KPMG as auditor, ending a relationship with two partners he’s known for more than ten years. Magda was the one calling out KPMG publicly for its role in the Gupta entities, the Gupta-wedding and the controversial SARS “rogue unit” report. “The termination of that appointment was extremely stressful. The partners on our account were the most ethical people you will ever meet. We terminated on Thursday 27 July. The following day I had coffee with the two partners. They were angry. Eventually, though, we were vindicated by KPMG’s own press release two months later, announcing the shortcomings of the firm in its dealings with the Gupta entities and the consequential cleanout of the top executive.”
With Magda as omnipresent strategist, it is difficult for Sygnia to convince the world that the company is more than a one-woman-show. “We are trying to change that perception,” says Mike, who was in the same boat at the Herman Steyn-led Prescient. “What amazed me when I joined was the number of very strong people working here. This is not a company of minions. COO Niki Giles, who performed the FD role until I joined, is the most phenomenal person to work with, for example. She knows everything about everything.”
As Sygnia grabbed headlines with its CEO’s political and ethical views, the share price proved volatile, which always makes institutional investors jumpy. Sygnia is now aiming to take its low-cost, high-tech investment model to a broader market and is also quietly eyeing opportunities in the UK. London might be a financial services capital, but there is still room for disruptors from abroad, says Mike.
“People think of South Africa as backwaters, but we are streets ahead in terms of transparency of fees. In the UK there is still a massive layering of costs.”
What is unique about Sygnia, is its focus on innovation and disruption, says Mike, adding that the company does not pay exorbitant bonuses to investment professionals and it does all its own administration. “One of our most exciting products is the Sygnia 4th Industrial Revolution Global Equity Fund, which invests in indices that tracks companies producing products and services in things like artificial intelligence, self-driven cars and other tech of the future. In October, this was year-on-year the second best performing unit trust in South Africa.”
Entrepreneurs like Herman and Magda are not typically acknowledged for their high levels of EQ and abundance of compassion. Although the same might apply to the stock standard chartered accountant, Mike has made it his mission to add the human touch to the working environment, for the benefit of both the business and the individuals working there.
“I believe it is very important to develop relationships with everyone from the tea lady to the CEO,” says Mike, who was supervising HR at Prescient and now again at Sygnia. “Although it sounds touchy-feely, which I am not, I find that personal relationships are crucial for the success of companies and the individuals who work there. People who work with entrepreneurs get used to a role model that is always intense, but I think I’m very good at combining high intensity at the desk with having downtime off the desk,” says Mike, something Magda would have known when she texted the job offer to the forested birding Valhalla of eastern Panama. “That balance,” says Mike, “is the key to how I work.”