ISSUE 20

David Frankel

 David Frankel’s Twitter bio is pretty simple, “Managing Partner at Founder Collective. Co-founded IS – largest ISP in Africa. Family. Runner. Optimist.” It does an impressive job of bluntly stating what he has achieved and what is important to him without letting you in too far. What it does not share is the entrepreneurial brilliance of this man, his inspiring mind and sharp eye, that culminates in supporting the dreams of others.

 
In fact, at Founder Collective (FC), Frankel and the rest of the FC entrepreneurs put their money where their mouths are – literally – by providing capital for promising seed-stage companies. FC has seeded companies like Brontes (sold to 3M), SiteAdvisor (sold to McAfee), Getmein (sold to Ticketmaster), PillPack, Makerbot, Buzzfeed and technology company Uber. What is blatantly clear in all of this is that Frankel has an excellent eye when it comes to spotting trends and good investment’s early on, something that shone through when he stood up to the plate and, as one of the first investors from Africa, made an investment into Uber, the now household name in the taxi industry.
 
A man that means business 
 
Frankel was a risk-seeking and determined 23-year-old when he co-founded Internet Solutions, which has become the largest private Internet Service Provider (ISP) in Africa. He talks about his experience as a co-founder of IS on FC’s website, “I made tons of mistakes…who ever said building a company is easy? It takes extraordinary focus, passion and alignment.” 
 
IS became profitable within its first year, and Sprint – an American telecommunications company - made an acquisition offer in 1995, which Frankel, its then CEO refused, before selling 100% of the company to Dimension Data in 1997. 
 
He went on to start FC in 2008, perhaps because he wanted to help hopeful and promising entrepreneurs through the kinds of early mistakes he had made. When it comes to lessons learnt in early stage investing he says, “I’m hopefully offering some pattern recognition – we try to walk in the entrepreneur’s shoes. As investors, if we haven’t helped to develop the business and make a bunch of decent introductions, we’re not doing our jobs.” 
 
"Our role is to deploy the first capital to help an entrepreneur articulate and reach a crisply defined set of milestones. Once we've hit those milestones, try to go get additional funding at a higher valuation, minimising dilution for all shareholders. That's our obligation to our founders."
 
It’s no surprise really then, that he is increasingly successful. In 2000, he was voted the South African Technology Achiever of the Century and selected by the World Economic Forum for the GLT programme in Davos, Switzerland. 
 
Frankel has an Honours Degree in electrical engineering from Wits University, post selection for the Fullbright Foreign Scholarship Programme and an MBA with distinction from the Harvard Business School. But he’s not all business and is also an avid sportsman. He has climbed Mt. Kilimanjaro, cycled in numerous races and ran in the 2009 New York Marathon. 
 
Uber and a new era of travel in South Africa
 
A detailed description of Uber on its website says the company is, “an American international transportation network company headquartered in San Francisco, California. The company develops, markets and operates the Uber mobile app, which allows consumers with smartphones to submit a trip request which is then routed to Uber driver-partners who use their own cars.”
 
As of 28 May 2015, this service was available in 60 countries and 307 cities worldwide. Uber’s ultimate aim is to be more cost effective and more convenient than owning a car. It’s rise to success has not been easy, which is unsurprising considering that it is a massive market disrupter. With no clear legislation in place regulating its service Uber has faced numerous lawsuits and clashed with authorities and local taxi companies around the globe. But when the company launched in South Africa Frankel was behind it 100%. 
 
In South Africa, Johannesburg in particular, traffic is a nightmare. Road maintenance is shoddy and getting around is not always easy with daily accidents and drivers that are notoriously loose with speed limits. Uber has revolutionised travel here, as it has done in all the other countries where it operates, bringing cities closer together with an app that enables them to request a vehicle no matter where they are, or the time. 
 
Uber launched in South Africa in 2013 and growth has been strong - the company has notched up two million rides locally in the first half of 2015 according to Fin24. At this stage Uber is only operating in the country’s main cities of Johannesburg, Pretoria, Cape Town and Durban, but it is exploring expansion into smaller South African cities as well as north into Africa. 
 
Uber head of Sub-Saharan Africa, Alon Lits says, “As a company we say internally that we want to be in every city globally with a population of more than 200 000 people.” 
 
It is amazing to think that without people like David Frankel, and their belief in the dreams of others, companies like Uber that revolutionise the way we live might not exist.