In this episode of Our Mergon Journey, Pieter Faure, Almero Strauss and Lauren Cloete-Henning share some of their learning experiences as a small new team. At the time, there simply was no blueprint available for operating in the diverse environments of entrepreneurial investment, philanthropy, and corporate social impact. Driven by their shared dedication to learning and improving, and to understanding God’s ways in business, the team found their way forward.
In the previous article, Pieter and the team discussed the transition from founder Francois van Niekerk to the next generation team, which sets the stage for the journey described here. Pieter and Lauren were integral members of a small team that was entrusted with a blank canvas, providing them with the opportunity to shape the path ahead.
Lauren fondly recalled her Mergon journey, which began during a church conference in France where she crossed paths with Pieter while serving as their translator. Mergon’s unique mandate of making a meaningful impact through business intrigued her and kickstarted conversations that resonated with Lauren’s passion for corporate social responsibility.
Reflecting on these early discussions, Pieter realised that there were questions and nuances to the dynamics of social impact that the team had not yet considered. ‘It wasn’t quite as simple as I thought it would be,’ he remarked. ‘We realised if we are going to be successful in having positive social impact, Mergon would need to be investing in the right people. People with a deep knowledge of the social development as well as the impact sector.’ For this reason, Lauren was invited to relocate to Pretoria and join the Mergon team.
Building upon Pieter’s reflections, Lauren shared what excited her about joining the team, and how her previous learnings could benefit Mergon’s vision for partnership and sustainable impact. ‘Having developed standards of applications and evaluations from my previous work in the UK,’ she explained,’ I just loved the idea that we could apply these practices and knowledge to the South African context. I saw that we needed to professionalise the work that we were doing and align ourselves with standards of excellence. This was important not only to us, but to the organisations, businesses, and philanthropists we worked with.’
Pioneering new paths amidst a global crisis
Lauren took to this task wholeheartedly, seeking to understand the South African social impact landscape and how Mergon could best serve the partners who operate within the sector. At the same time, the company had just come through a significant period of growth, and the team felt they were facing a crucial decision. At the time the portfolio consisted primarily of ownership in private property funds in South Africa. The question was: do we adopt a more conservative, capital preservation approach or do go the entrepreneurial route? They chose the more courageous road, opting for entrepreneurship…ironically just as the 2008 financial crisis hit our global shores.
Against this backdrop, the team made a bold decision to increase their giving during this challenging period. He explained, ‘We wanted to start funding organisations we were starting to build relationships with. But we were sitting with a balance sheet that was very illiquid. Although it was fast growing, the private property funds weren’t paying dividends, but were rather focused on capital growth.’
In light of more than two decades of portfolio growth, reaching impressive annual rates as high as thirty to forty percent, the team was now faced with the task of exploring innovative strategies to unlock cash flow. ‘Let’s be honest,’ Almero said, ‘it was a tough time. It was really difficult to be entrepreneurial in order to generate liquidity out of the portfolio for the giving, but also to reinvest in other smaller businesses.’
Cultivating courage through challenging times
Despite the very real challenges they faced during that time, Pieter noted that the atmosphere cultivated a great deal of courage and optimism. Thanks to Francois’ intentional approach to transitioning his leadership, he remained involved and present, providing mentorship and guidance. There was space to make mistakes and to learn from them, as the young team learned to stretch their faith and pursue ambitious ideas.
Pieter added to this perspective when sharing, ‘If I look back on those first years, I think God was more interested in our character than our success. If we had walked in and everything was flowing seamlessly, it probably wouldn’t have been good for us in the long run. As youngsters in the investment space, we had to learn how to wrestle through those challenges.’
‘We also needed to create a position of influence,’ he continued, ‘an influence that could only be established through solid relationships.’ To build trust and credibility with others, Pieter noted that they had to commit to staying humble and open to learn from their investment partners – an approach that he noted, ‘set the base not just for our investment approach, but for me personally’.
The significance of partnerships
There was a growing realisation amongst the team that Kingdom impact embodied much more than giving, but the way in which they engaged with their investment and ministry partners. Increasingly they were asking themselves, ‘How do we show up in spaces that reflects God’s heart and prioritises the interests of our partners whilst doing good business?’
Lauren elaborated on this idea, noting that the donor-beneficiary relationships was typically characterised by a ‘power imbalance’ that they desired to address and rectify through equal, trust-based partnerships. Often with the best of intentions, she explained, donors could take on a ‘saviour mentality’, resulting in the ministry becoming disempowered and overly dependent. ‘We wanted to change that dynamic,’ said Lauren. ‘Part of our journey was in spending time, seeking to understand both our ministry partners and not-for-profits’ realities. Knowing that they had so much to teach us, we wanted to hear their voices and understand their approaches. The key was to encourage both parties to see one another as partners on the journey – not just as ‘donors and recipients’.
This dynamic was no exception in the investment space, Almero said, acknowledging the influence that comes with capital and how it more often leads us to assume we’re the experts in the room. ‘We wanted to come with a different spirit – as ‘co-entrepreneurs’, learning alongside them on this journey.’ He explained how they were intentional about honouring leaders, coming humble and teachable to the table, and applying biblical perspectives to the way they engaged in these relationships.
In the remainder of this podcast, Pieter goes on to emphasise the importance of nurturing healthy relationships and teams as a fundamental aspect of stewardship. Through personal anecdotes and vivid memories shared by all three participants, they provide both practical and inspiring perspectives on the significance of investing in people.
To hear some of these stories, listen to the full podcast here.