Performance of Safaricom under Michael Joseph, Bob Collymore and now Peter Ndegwa
Safaricom has been in operation since 1997, and has had three different CEOs in its history: Michael Joseph, Bob Collymore, and Peter Ndegwa. How have these leaders influenced the performance of the company over the years? Let’s take a look at the revenue and profit trends from 2007 to 2023. Data prior to 2007 isn’t easily available as Safaricom wasn’t reporting its financials by that time.
Michael Joseph: The Pioneer
Michael Joseph was the first CEO of Safaricom, serving from 2000 to 2010. He is credited with launching the revolutionary mobile money service M-Pesa in 2007, which transformed the lives of millions of Kenyans and became a global success story. Under his leadership, Safaricom grew its revenue from Ksh 47.4 billion in 2007 to Ksh 84 billion in 2010, an increase of 77.2%. The net profits also increased from Ksh 12 billion in 2007 to Ksh 15.1 billion in 2010, an increase of 25.8%. However, the profit growth was not as consistent as the revenue growth, as it dipped by 24.5% in 2009 due to increased competition and regulatory challenges.
Bob Collymore: The Visionary
Bob Collymore took over as the CEO of Safaricom in 2010, and led the company until his untimely death in 2019. He is remembered for his visionary leadership, which focused on innovation, customer satisfaction, social responsibility, and sustainability. He oversaw the expansion of Safaricom’s product portfolio, including the launch of new services such as M-Shwari, Fuliza, Masoko, and DigiFarm. He also spearheaded the diversification of Safaricom’s revenue streams, reducing the reliance on voice and SMS, and increasing the contribution of data and mobile money. Under his tenure, Safaricom’s revenue grew from Ksh 94.8 billion in 2011 to Ksh 250.3 billion in 2019, an increase of 164%. The net profits also grew from Ksh 13.2 billion in 2011 to Ksh 62.5 billion in 2019, an increase of 373%. However, the profit growth was not smooth either, as it declined by 12.6% in 2011 and by 4.5% in 2012 due to increased operating costs and taxes.
Peter Ndegwa: The Challenger
Peter Ndegwa became the CEO of Safaricom in April 2020, making history as the first Kenyan to hold the position. He inherited a company that was facing unprecedented challenges due to the COVID-19 pandemic, which disrupted the economy and affected consumer behavior. He also faced increased competition from rivals such as Airtel and Telkom, as well as regulatory pressure from the government and civil society groups. He embarked on a new strategy called “Purpose-Led Transformation”, which aimed to transform Safaricom into a purpose-driven organization that creates value for all its stakeholders. He also announced plans to enter new markets such as Ethiopia and launch new services such as e-commerce and cloud computing. Under his leadership, Safaricom’s revenue increased from Ksh 262.6 billion in 2020 to Ksh 310.9 billion in 2023, an increase of 18.4%. However, the net profits decreased from Ksh 73.7 billion in 2020 to Ksh 52.5 billion in 2023, a decrease of 28.7%. This was mainly due to increased investment costs, lower margins, higher taxes, and lower interest income.
Safaricom’s revenue and profit trends show that the company has been growing steadily over the years, despite facing various challenges and changes in the market. The three CEOs have each played a significant role in shaping the company’s direction and performance, with different strengths and weaknesses. Michael Joseph was the pioneer who introduced M-Pesa and established Safaricom as a market leader. Bob Collymore was the visionary who diversified Safaricom’s products and revenues and enhanced its reputation as a responsible corporate citizen. Peter Ndegwa is the challenger who is transforming Safaricom into a purpose-driven organization that seeks to create value for all its stakeholders.