Alan Knott-Craig Jnr, former Mxit and World of Avatar CEO

Last Friday’s Spice broke the news that Mxit CEO Alan Knott-Craig Jnr had resigned from the self-claimed largest social network in Africa. Citing a difference of opinion from shareholders as to the company’s expansion strategy, Knott-Craig Jnr resigned from the cellphone social network, as well as its holding company, World of Avatar.

His parting words, sent to staff in an email on his departure, were short and sweet:

The good news is that the shareholders and I believe in the same vision … we just couldn’t reach an agreement on how to get there.

Business Day is reporting that one of the key shareholders, Paul Harris, was not happy about Knott-Craig Jnr’s style of management and performance as CEO, and would only invest his share of capital into the company if the CEO resigned.

Shareholders are plunging an estimated R100 million rand into Mxit as part of its expansion strategy. Harris, the former CEO of FirstRand Limited makes up one of the key shareholders. The other is GT Ferreira, the founder of RMB Holdings and FirstRand Limited, and currently number 27 on the Forbes list of Africa’s 40 Richest. We can only speculate, but given the conservative banking background of these two key investors that there may have been differences in the way things are supposed to be done.

The purchase of Mxit from Naspers and Herman Heunis drew a lot of publicity last year, the buyout being led by Knott-Craig Jnr. The sale was for an undisclosed amount,  but is believed to have been for around R350 million. This would bring the total investment into the network to around R450 million, if all figures are to be believed.

Concern has emerged as to whether or not the CEO’s departure will negatively impact the implementation of Mxit’s expansion strategy, and keep it ahead of its competitors.

Mxit currently has a user base of 44 million, of whom 10 million are considered “highly active.” The network serves approximately 750 million messages a day.

[Source: BDLive]