October 18 media was awash with the unexpected resignation of Alan Knott-Craig Jnr as CEO at Mxit and at World of Avatar pegged at investor and management conflicts probing doubts on the future of the firm touted as Africa’s success story.
In a press statement made available to BusinessTech, Knott-Craig said “while the shareholders and I share the same vision, we differ on how to get there. Therefore, I agreed to go my own way.”
BusinessTech highly ties the Alan Knott-Craig’s resignation to conflict between Knott-Craig and Paul Harris, one of the company’s largest shareholders. BusinessTech sources claim Harris had little faith in Knott-Craig’s leadership at Mxit.
Its claimed Paul Harris wanted to sale out his shares if Knott-Craig doesn’t step down, something Knott-Craig decided to comply causing the shareholders to put more money in the firm.
This also resonates to what Business Times reported earlier that “Paul Harris was unhappy with Mr Knott-Craig’s performance and style and was only prepared to invest his share of R100m — which shareholders are ploughing into the company — if the CEO resigned”.
Knott-Craig’s departure from the the business was based on performance but Mxit’s worrying financial performance and growing competition from BlackBerry Messenger and WhatsApp also influenced.
On cases of integrity too, there have been questions on the truth on the exact number of Mxit’s active users with doubts that that the 10 million mark may be a publicity stunt.
One industry expert says active Mxit users in South Africa are close to five million but Mxit told BusinessTech that its“monthly active user number moves up and down between 9.3 million and 10 million”.
The firm’s revenue and profitability have also been questioned; which is contrary to their acquisitions.
Just recently, Mixt acquired Motribe at US$xxx and earlier on had cquired xxx putting shareholders on tension on how their money is being spent.
A new CEO is yet to be appointed but at the moment Francois Swart, the current CFO, is acting as interim CEO.