Paul Janisch

More on the MS equity equivalent

Further to my post last night, I found an article (written by Duncan McLeod) that goes into a little more detail on the machinations of the equity project.

• The R472m will be spent in roughly equal portions of nearly R70m/year over the seven-year investment period.
• MS plans to spend the R472m helping between five and 10 black-led and black-owned software development houses, providing them with technical, business and marketing support.
• They’ll also be given access to Microsoft resources internationally and offered support in selling their products in markets worldwide.
• It is not interested in pure start-ups, wanting to work only with software development companies with a track record.
• They estimate each of the companies they invest in will have 300-400 people at the end of the seven years.

Worth noting is that

Microsoft’s early research suggests it will get about 200 applications from interested companies. The will probably end up with about 50 that meet the criteria

I find this last paragraph the most interesting.  This tells us that there are at least 200 black-owned software development houses.  This is wonderful news and something that the ICT sector should be proud of (that's when they stop bitching at each other over their BEE Charter).

Two other points and then I go

1. McLeod writes that the company will not take an equity stake in any of the businesses it works with and does not expect any payments in return. It also does not expect a return on its investment, though it expects the initiative will benefit it indirectly later.  I suspect that this last line was something annouced at the press conference.  Brilliant!!!!!!!!!!!!!!!!! It's the WIIFM principle and they are patently obvious about it.
2. And MS SA's BEE rating will be boosted, probably taking it from a level-four contributor to level two

I cannot say enough about this.  If it isn't text book stuff then the text book be should be written around this case study.

MS equity equivalent big deal

This is a big deal and a fantastic one at that.  Microsoft SA has announced their R472m equity equivalent project. 

The project will see Microsoft spending R472 million into helping small, black-owned software development companies grow into global companies by 2017. Participants will be chosen from responses to a nationwide request for proposal, slated for issue in early May. It is expected that between five and ten companies will be part of the initial programme.

This is the real deal, the big cheese, the main man - the mega pantsula.  Build up global companies and they will become huge users of MS products. 

I love this, it uses the WIIFM principle which goes like this

MS has a problem - it needs more BEE points. 

I would imagine that it's got the other seven elements covered.

Solution - equity equivalent

But not any old equity equivalent project.  One that focuses on their products and services and develops a project that does exactly that.  Just like HP did.

Phenomenal.  And this is what BEE is about.  If you have a vested interest in any BEE related activity then it stands a greater chance of success.  And this works across the board.  Don't do it because it is the right thing to do. do it because it works for you. 

Well done Microsoft......... oh and,   Lester were you involved in this at all?

Oh yes another mantra

ASK NOT WHAT YOU CAN DO FOR BLACK ECONOMIC EMPOWERMENT, BUT WHAT BLACK ECONOMIC EMPOWERMENT CAN DO FOR YOU