BusinessExecutivesWord of mouth brings the message to millions - Mxit CEO, Alan Knott-Craig Jr


Posted on Monday, 08 October 2012 11:33

Word of mouth brings the message to millions - Mxit CEO, Alan Knott-Craig Jr

ALAN KNOTT-CRAIG JR CEO of Mxit/Photo©HETTY ZANTMAN/FINANCIAL MAIL/GALLO IMAGES/GETTY IMAGESIn September 2011, Alan Knott-Craig Jr's World of Avatar bought 100% of South African messaging platform Mxit, and he became its CEO. Ten months on, he explains how he's wooing app developers and expanding in Syria.


The Africa Report: How has Mxit performed since you took charge? 

Alan Knott-Craig Jr: It's binary. We're either going to be a very big mushroom cloud that you can see from space – in other words, a disaster – or we're going to take over the world. Right now it feels like we're going to take over the world.

How many countries is Mxit in?

A hundred and twenty six. We're adding about 35,000 new customers a day and we're not marketing. It's just word of mouth. We're doing about 700-800m messages a day ... over 20bn a month. Twitter does a third of that. My users only have one thing, a phone, and they only use Mxit. All those hours people spread out over other devices in the West are consumed entirely within Mxit; that's why it's so much more engaged. The only limitations to our growth relate to the number of handsets in a country and whether the operators are enabled for data.

Are you expanding into other countries?

It's random. We've got a lot of customers in Syria at the moment. The Syrian government shut down Twitter, Facebook and What's App. Everyone's jumping onto Mxit, and the Syrian government can't really phone my company, because it's difficult to phone them. Our biggest countries outside of South Africa are the UK, Indonesia – where we've got about 2.5 million users – and Mexico with just over 1 million. 

Is the smartphone relevant to your growth?

I would say less than 1% use smartphones, as defined by Android, iPhone or Windows phone. I don't think of BlackBerry as a smartphone ... if you include BlackBerry, it's probably 3%. Everything else is feature phones and dumb phones.

I like the smartphone because it takes everybody's eye off the ball. Everyone keeps developing for Android and for iPhone; meanwhile 80-90% of phones being sold on the continent right now are not Android or iPhone, they're feature phones. One of the key things about Mxit is that it's a handset-agnostic social network. Where we fall flat is that it's a pretty mediocre experience when you try to use it on an iPhone, so we do lose customers as they and their friends move on to nicer phones. 

What agreements do you have with developers?

[Since 30 March] we pay a revenue share to content partners of about 70%. We have a virtual currency called Moola. Anybody can develop for the platform. You can come up with a service, like a motivational quote a day, or a soccer player or a dating game. A lot of guys are starting to make money from it. This is an entry point for aspiring entrepreneurs, because we create a platform that gets to the majority of people in the market and they get a decent revenue share.

We've had over 100 or so people sign up for the [Mxit] API. Over 56 apps have been developed [by early May]. We've already published about 10 or so. Two guys in Cape Town wrote a little dating app called Judge Me. After 75 days they had 1.2 million users with over 250,000 uploads, and we will pay them a revenue share this month of about $8,000. 

How many countries does Moola 
work in?

One Moola is one South African cent. We only have Moola working in Namibia, South Africa, Swaziland, Kenya and Lesotho. We've got to accelerate. A lot of the time you're held back by the operators, because if they don't have premium-rated SMS you can't have any kind of operator billing.

Is content your main revenue source?

No, about 70% is from content and about 30% is advertising. [That] is going to grow, guaranteed. [Though] I hope it doesn't, because I want to build the business around selling content rather than selling data. I don't want to be Facebook. They're compromised. The only way they'll ever grow revenue is to sell even more of your information to somebody you don't know without your consent. Our business model is all about being open, honest and frank. The irony is, in America people expect everything for free. Here, they don't mind paying●

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