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Michael Joseph: My highest and lowest moments at Safaricom – Business Daily

Former Safaricom CEO, Michael Joseph. FILE PHOTO | NMG
Former Safaricom chief executive Michael Joseph recently stepped down as the telco’s board chairman, reigniting debate on changes at Kenya’s most profitable firm. After two decades at the telco, Mr Joseph is perhaps the longest-serving executive at Safaricom, having seen the company from its infancy.
He spoke with the Business Daily on Thursday from his home in West Wales, United Kingdom, about a wide range of topics, including his upcoming autobiography, and the birth of M-Pesa. Excerpts:
You have been a central figure in the growth of Safaricom since its inception. What do you consider the highlights of your career?
You would need another two hours. I am actually writing a book. I spend an hour every day writing about my time not just at Safaricom but before that. But it’s difficult to say what the highlight is. I think probably it’s the launch of M-Pesa and the success of M-Pesa that nobody expected.
Also, just how Safaricom during my time always stood out to be counted when there was a need — the previous drought or when there was flooding.
Our social responsibility and our response to those kinds of things is what is very important for me in Safaricom. Of course, being financially successful is also great. But those are the big highlights.
When do you expect the book to be ready?
I would say probably another year. Everybody can write an autobiography and it would be okay. But to make it interesting you have to sort of divulge certain sensitive things and maybe you have to be very careful about the timing of that because you might say things about important people.
And maybe you have to be careful. It will be probably a year. It’s majority written but it still has a lot more to go.
What are some of those sensitive things we should expect?
You have to wait and see. I have done interesting things in my life not only in Kenya.
How much are you worth?
I have been an employee all my career. I have not invested in companies and made a fortune of any kind. Where you make money in a company like Safaricom or Vodafone is that you get allocated shares based on your performance then at some point you can sell those shares.
Basically, that’s all I’ve had. I don’t have a fortune. I have one house which I bought which is in West Wales and I have a flat in London and those are my total assets.
There is no fortune. People talk about a Shamba or a ranch in Laikipia, but I don’t have one. I have a home in Lewa, which I rent from the landowner. Money is useful, of course. We all need to live and eat but I’ve not been one to try to be very rich.
I will never be rich. I will never own a yacht. I will never own a Ferrari, which is my lifetime ambition to own a Ferrari. I just drive an Audi.
What are the biggest lessons you learnt as a two-time Safaricom CEO and in your later role as a long-serving chairman at Safaricom?
There are many, but one that stands out for me is that you need to lead from the front. As a CEO of a very public company, you need to lead from the front. In the early days we had a lot of challenges like congestion and failures and in moments like those you had to stand up and be counted and say I’m responsible.
Mostly you need to be hospitable, I’m not a social animal, you hardly ever see me now in public but I was sociable when I was CEO. You need to be sociable internally. I would always talk to people, they could come to see me anytime.
What were some of the lowest moments?
In the early days of Safaricom, we had very little money. Our total cash investment was $20 million and that came from Vodafone. Today we are worth $15 billion. So we struggled with capacity and the level of service we wanted.
It was low days when people accused you of things especially the congestion on Friday. After that, we raised a corporate bond and raised the capacity. Also in 2003, I was diagnosed with cancer. It was probably the lowest time in my life.
Did that congestion spark the controversial remarks on Kenyans’ “peculiar calling habits”?
Yes. In those days the network was fairly empty during the day from morning till 6 p.m. And then at 6 O’clock people on their way home in the matatu or in cars, everybody would start to call and between 6 p.m. to 8 p.m. our network was jammed and I quipped why can’t they call before that time?
That’s why I coined the phrase peculiar calling habits. I didn’t call Kenyans peculiar people. I said they had peculiar calling habits.
In latter years when your predecessor Bob Collymore was diagnosed with cancer, was it a feeling of Déjà vu?
It was tough for me. I empathised with what he was going through because I had been through it. I was very close to him. I was very devastated that he lost the battle.
You were credited with the launch of the pioneering mobile money platform M-Pesa and taking the telco public in June 2008 via an initial public offering. What does this mean to you?
It is so big. When we started M-Pesa we did not know it would be so big. [There was] a lot of opposition not just from the banks but also internally from my main shareholder who said this is a waste of time.
The criticism of M-Pesa and the amount of money we were spending came from the main shareholder. It came from the top. Many people said this is never going to work. Only a few of us in Safaricom believed it would work. Did we think it would be this successful? Absolutely not!
You earlier publicly regretted that some of Safaricom’s lending products like M-Shwari were intended to be savings and borrowing products. But people now borrow more than they save, which is not what you intended. How does this make you feel?
I really wanted M-Pesa to have much more impact on people’s lives in terms of savings. Unfortunately, because the financial rewards if you lend money are much higher it became [more of] a lending product than a saving product. This lending culture in Kenya is very bad for our country. It will take time to change this.
Safaricom has in recent weeks recorded many high-level exits, how does this reflect on the stability of the company and on the new management?
These are just things that are happening in coincidence. This is a natural evolution.
What will be your new role in Safaricom for Ethiopia operations?
I don’t have a role really. I have started at least four Greenfield operations from nothing to where they are today. I have a lot of experience. So it’s just to lend my experience and advice to the new team in Ethiopia for the next two years. I don’t have an executive role. This frees me up to advise the team.
You earlier sold your Safaricom shares to build a house, did you finish building it and would you consider buying back your Safaricom Shares in the medium or long term?
It’s a beautiful house. It’s a dream house. It’s our final house for me and my wife. It’s right on the edge of the sea in West Wales. In retrospect, however, when I sold my shares to build the house, I probably should have held on a little longer because the shares are worth much more.
But who knew what could have happened in the share market? For instance, I wish I had bought shares in Apple when they were starting, I would be very rich.
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Joseph Muongi

Financial.co.ke was founded by Mr. Joseph Muongi Kamau. He holds a Master of Science in Finance, Bachelors of Science in Actuarial Science and a Certificate of proficiencty in insurance. He's also the lead financial consultant.