You don’t go from growing up in a small town to leading a billion-rand equity firm with sheer luck. As Dion Mhlaba’s story shows, it’s a long and bumpy road to the corner office.
Dion Mhlaba was only 29 when he became the chief financial officer of RH Managers, a private equity firm managing a fund of R4bn (yes, you read that correctly)—more money than most people see in a lifetime. Two years later, when the firm created the subsidiary RH Bophelo and listed it on the Johannesburg Stock Exchange, Mhlaba became the youngest black CFO of a listed company. To put that into perspective, consider a 2014 survey by the SA Institute of
Chartered Accountants (SAICA), which revealed that 75% of directors in JSE-listed companies are white and 93% are over 40. Mhlaba’s the exception to a deeply entrenched rule, thanks to sheer hard work and determination. Those were essential qualities for an ambitious boy who was one of six children of a police officer and a housewife in Bushbuckridge, Mpumalanga, a town that’s not exactly renowned for its success stories.
According to 2016 statistics, Mpumalanga’s population of fewer than 600 000 has an unemployment rate of 85%. Earning first position in his matric commerce class, and third position overall, proved to be Mhlaba’s ticket out. However, as he discovered when enrolling for a BCom in accounting at Rand Afrikaans University (now the University of Johannesburg), it came with no guarantees. The partial scholarship he had received from the National Student Financial Aid Scheme (NSFAS) wasn’t enough to cover his tuition and living expenses, so Mhlaba rolled up his sleeves and took a job at a call centre, working eight hours a day to earn extra money. “Holding down a full-time job while studying was a strain,” he recalls. “My workplace was a long distance away from the university, so I’d work from 8am-4pm and only reach the campus at 6 pm. I started attending night classes with part-time students so that I didn’t fall behind on the material, but my days were exhausting.” However, he persevered and graduated, only to face another obstacle: when the time came to pursue his BCom Honours in Accounting (CTA), the NSFAS refused to fund him any further.
Mhlaba turned to Jelvin Griffioen, an accounting lecturer at the university, who was also coordinating the Thuthuka Bursary Fund. The fund is an initiative of SAICA, aimed at enabling more black professionals to qualify as chartered accountants, and it was through this that Mhlaba paid for his accommodation. “I could tell from the first time I met Dion that he was a very serious and deserving student,” recalls Griffioen. “He’d already come a long way and overcome quite difficult circumstances, so when he came to us for assistance, it was a no-brainer.” Griffioen even went a step further, helping him secure financial support from auditing firm KPMG to help pay his tuition fees.
Corporate Culture Shock
The day Mhlaba completed his CTA, he received phone calls from four different auditing firms, each offering him a training contract he could take up immediately. The young graduate chose to do his articles at the one that had helped him through university—KPMG. Having officially entered the corporate world, he could finally start earning something that really hit home when he received his first promotion and compared his salary with that of his father’s. “With that first raise, I realised that my dad and I were on par in terms of income. It was crazy because he’d
been working for 20 years and I’d just started,” says Mhlaba. “I don’t know how he managed to raise a family of six kids on that public servant’s salary, but he found a way to do it and we owe him everything for that.”
It wasn’t all sunshine and roses, though. Mhlaba was realising that the barriers to black success in the corporate world run deeper than the high cost of education. “Fitting in was never easy for me,” he recalls. “When I first started, I had to get a personal loan to buy formal clothes. My white colleagues all had cars from the day they started working, but it took me a long time before I could afford one. So there were times I’d be looked at as not being a team player because I had to leave the office at 6 pm to catch a minibus taxi. I think it’s a culture shock for many senior people in SA’s corporate world to realise that most black people aren’t as fortunate as their white Counterparts; SA is bigger than Sandton.”
Nevertheless, Mhlaba didn’t allow these challenges to derail him from achieving his goals. He completed Board 1 of his articles in his first year, as planned, but in the third year, he experienced a major setback: he failed Board 2 and had to repeat the entire year. “What I learnt from that experience was that our paths in life are never the same,” he says. “It might take one year for one person to achieve something and take you 10 years, but that doesn’t make you a failure. Whenever I’m going through difficulties, I remind myself that there was a time when I failed, but it didn’t stop me from waking up every day and keeping at it.” Mhlaba bounced back from the disappointment with a vengeance, completing his articles at the same time as the peers with whom he’d started, and becoming a Chartered Accountant. He spent the next three years as an accounting lecturer at UJ, while also establishing and successfully running a private consultancy, before leaving academia to join Thebe Investments as a financial manager.
Yet all of this was just a precursor to the most significant chapter of his career: his appointment as CFO of RH Managers.
Show Me The Money
In 2015, after a year at Thebe Investments—where the directors had advised him to leave the accounting backroom and use his talents in the foreground of the corporate world—Mhlaba was approached by Quinton Zunga, the founder and CEO of RH Managers, a private equity firm specialising in healthcare, with the offer of becoming its CFO. The opportunity came at the ideal time. “Dion was highly recommended by one of our institutional partners and as a CA with experience in private equity, he was exactly what we wanted,” recalls Zunga. “He didn’t have a background in healthcare, but he’s really taken the role in his stride, constantly improving and taking on more responsibility.” RH Managers raised its equity from pension funds and focuses on seeking opportunities to build hospitals in areas where there’s limited access to healthcare. So far, the firm’s built five hospitals spread across KwaZulu-Natal, Limpopo and Mpumalanga, and has purchased one in the Free State.
Mhlaba’s entry to the stock exchange came with the creation of RH Bophelo, a subsidiary of RH Managers. The company’s strategy is to consolidate all private hospitals outside the country’s big three healthcare players: Mediclinic, Netcare and Life. It managed to raise R500 million in equity and a R250 million mezz line on its JSE listing in July this year. “In the next five years, we want its value to grow to R10 billion,” says Mhlaba. “We know it’s possible because there are many untapped opportunities around the continent.” The same drive and ambition that got Mhlaba out of Bushbuckridge and into the boardrooms of Johannesburg, Africa’s financial hub, are set to take him even further. “I can’t think of a better role model for young black accountants who aspire to enter the corporate world,” says Zunga. Neither can we.
*This article was originally published in Destiny Man (December issue, 2017). It was written by Kibo Ngowi.