I'VE been an entrepreneur several times in my life but was never very good at it. I always got lost in the processes and culture, instead of fanatically driving revenue. Attention deficit disorder works better in journalism, you know.
But sometimes I'll sit in a restaurant and try to work out the “boeresom" of the place – the kind of sum you do on the back of a pack of 30s, like farmers at a livestock auction.
I would look at the number of tables in the place and the average price of a meal on the menu. I would consider how many people typically sit at a table, take into account the day of the week, and so on. I would estimate how many times each table was occupied per day. I would imagine a profit margin and what I think the rent costs would be and the wages, everything I could think of. And then I would almost always reach the point where I decided never ever to start a restaurant or even invest in one. Don't even get me started on hotels.
Of course, among serious businesspeople these kinds of business plans are worked out with much more experience, knowledge and precision than scribbles on the back of a 30-pack of Rothmans, but I can tell you I don't have the guts (or cash!) to get involved.
Lees hierdie artikel in Afrikaans
Where does the cash come from?
I've been watching South Africa's diamond-package king, Louis Liebenberg, throwing money around in public over the past few years with growing amazement. Of course, I couldn't do a “boeresom" of his enterprise because too much of it happened in the shadows, but even after the National Prosecuting Authority froze his business Tariomix's bank account with R100 million in 2021, the flamboyant kingpin handed out cash in abundance.
When it was said that he gave former president Zuma R500 000 in a questionable manner to finance his court case against prosecutor Billy Downer and journalist Karyn Maughan, he responded like a veritable Donald Trump from the sidelines: “It was closer to R2 million! It was closer to R2 million!"
Around the same time, he married the third love of his life in lavish style – a blonde estate agent from Bloemfontein, Dezzi van Schalkwyk. Pretoria's flashiest playboy cult pastor, Xandré Strydom, preached; Rejoice Zuma, Carl Niehaus and the Zulu king, Misuzulu kaZwelithini, were there. The minister of social development, Lindiwe Zulu, reportedly was there too, and various sports stars and a well-known singer, Rudi Claase (don't worry, I also had to google him), entertained the couple. This event allegedly cost Liebenberg around R6 million (though investors' money apparently went straight through his pocket to the suppliers, without passing Go!).
By the way, does anyone know why people want to go to the weddings of people they don't know? I don't even want to go to the weddings of people I do know... By the way, Louis I of Bronkhorstspruit's mother wasn't at the wedding because, as he said, it was his third wedding and she only had two dresses. And a final by the way, Louis I of Bronkhorstspruit had a meeting with minister Zulu shortly after his wedding ceremony, for no declared reason, and all the general public knew about the meeting was that her spokesperson said afterwards that the minister recommended Louis I seeing a therapist, “because something isn't right with him".
Liebenberg never stopped throwing cash around, even after Tariomix was liquidated this year – he showed up at art auctions and bought paintings at four times their value, he paid for fallen singers' addiction rehabilitation... You Magazine and Rapport are the reference works on the details.
Sums that make eyes bulge
The point is, I couldn't figure out where he got so much cash from after the authorities had frozen so many of his bank accounts. However, the mystery disappeared with his and his eight co-accuseds' first court appearance in October, when a bit more detail about the charges became available. The state has brought 42, including fraud, alternatively theft, racketeering, money laundering, and various violations of the Companies Act.
But what made my eyes bulge was the amount of money involved. It's estimated that Tariomix took R4 billion in “investments" from people over the years. To put that in perspective, it's about a billion rand less than the value of diesel that Eskom has to burn this year to keep the lights on.
What can we learn from this? That Louis Liebenberg deserves an A+ on his report card for fundraising, despite anything you or I might think of him, and despite his methods.
Other estimated figures are similarly eye-watering. Liebenberg and his eight accomplices allegedly “for their personal use" pocketed R326 million. Dezzi spent R350 000 on bedroom renovations and rented a house for R504 000 per year. In Walter Niedinger's trust account (until recently still Liebenberg's legal representative), R100 million was deposited, of which R40 million was spent on West Coast Resources (one of the diamond mines), and the other R60 million... well, who knows? Perhaps part of it was used to pay for Louis and Dezzi's luxury honeymoon in Italy, Spain and Greece.
The question that stays with me is: How the devil do you pull off something like this, which by all indications went on for 15 years (most reports say it started around 2019, but Tariomix was already registered in 2011), under the nose of ordinary people, the financial regulator, the banks, and the SAPS?
Baed on what I could read and understand, I've put together a ten-point Liebenberg plan, which aspiring pyramid kings may appropriate.
Louis Liebenberg’s blueprint for becoming filthy rich and extremely important
1. Develop an obsession with creating an all-consuming whirlwind of cash. How you'll achieve this you can work out later, but without an absolutely blinding obsession and singular focus on an obscenely strong cash flow, R4 billion will remain a vague mirage on the horizon.
2. Choose a country where the legal system is compromised. South Africa is the perfect country for the kind of operation that someone like Lieb might set up. With raw materials, there are industries like the diamond trade where massive amounts of cash are generated in a kind of Wild West environment. If you own several legitimate mines, it solves your problem of having a legal relationship with the banks, and you can get cash into the official banking system, something you must do to keep one of your biggest enemies, the SA Revenue Service, under control. South Africa's police and regulatory bodies are so overwhelmed that a Namaqualand cowboy with ideas for smuggling with virtual diamond parcels, would take far too long to catch their attention.
3. Get your convincing bogus story straight. People won't give you money if you don't give them a chance to deceive their own brains with the story you plant with them. Adriaan Nieuwoudt, by coincidence (or not?) from the same general part of the country as Liebenberg, made turning sour milk into cosmetic products sound like a Mozart symphony. If people believe such insane nonsense, why wouldn't they believe that you could become a partner of a seasoned diamond trader who can legally buy diamond parcels cheaply from miners and sell them at a considerable profit on world markets? That sounds quite possible.
4. Promise an attractive return, but not paradise. As far as I understand, King Louis promised anything between a 10% and 30% return, depending on how well your parcels sold. This is an almost genius way to get around the “if it sounds too good to be true, then it is too good to be true" warning. A 30% return is too good to be true. But 10% sounds good too, and you make at least something. But what if we hit that 30%?
5. Create a shadowy marketing network. If I ever have time, I would really like to research the details of Louis Liebenberg's communication and marketing network, because this is where the success lies. From what one can see, he perfectly exploited the intersection of the internet and existing social networks. Of course, you create a few instant millionaires with your initial cash flow, so that stories of good returns start circulating on the networks. Nothing, and let me repeat, nothing will market your money-making story like people convincing their friends. In the beginning, Liebenberg spared no effort to recruit investors. He would meet someone in a coffee shop over a R2,000 investment, he ran a poetry group on Facebook (yes, you're reading that) and marketed his parcels through it, he pulled out all his lay preacher talents from his charismatic church background, he built WhatsApp groups, and so on and so forth.
6. Create an inner circle of fanatical loyalists. This is probably obvious, but it helps to be a charming speaker and entertainer.
7. Make sure you have enough bank accounts and companies. Operations like Liebenberg's depend on constantly breaking up large sums of money and moving them around between a whole string of accounts and companies to stay under the radar of tax authorities, other investigators, and upset investors. Besides Tariomix, there was Wealth4You, Tariopart, Golden Nugget, Marauder House, Forever Diamonds and Gold, Forever Zircon, Nama Stones, Anolascore, Forever Brilliance, Telgowell, Ulrilox, Zovilor, Galronex, Genzefo, Nastotorque, Enziware, Petratel and Lionsgate. I'm sure I've missed quite a few more.
8. Become a media magnate. One might as well think big and believe you can control the narrative. Start an online publication called Die Waarheid (The Truth) (!), hire a retreaded but popular broadcaster like Niekie van den Berg, and an experienced editor like Dirk Lotriet, and let it rip. All in true Trump and Musk style.
9. Develop a celebrity status. Louis made sure several prominent celebrities invested in his scheme, such as the very popular Namibian Afrikaans singer Juanita du Plessis and her husband, Doepie. He would also dramatically intervene in fallen celebrities' personal problems, like Loftus Versfeld's former darling fly-half, Derick Hougaard, for whom he allegedly arranged rehabilitation for his alcohol and drug problems, and even took him into his home for a period.
10. Develop political affiliations. One doesn't know how many dividends Liebenberg's loose connection with the state capture gang and later the MK Party, Jacob Zuma, Ace Magashule, and Carl Niehaus brought him, but he tried. After Rapport released a video in 2022 where Liebenberg engaged in severely racist ranting, he decided to sanitise his image by forming connections with high-profile people of colour, and I reckon the Zuma circle was the best he could do, because there money speaks a clear language. He worked hard to revive the old myth of a kind of blood connection between the Zulu nation and the Afrikaner nation, but few people saw him as a legitimate Afrikaner leader. Liebenberg's own adventure in politics, when he stood as an independent candidate in the general election, gave birth to a pitiful mouse. Despite all the bravado and scandalous revelations about other politicians, he could barely draw 1 500 votes.
What’s the point of the madness?
One aspect of King Louis 1 of Bronkhorstspruit that I could never figure out was that he constantly posted the most absurd video monologues on social media. He would launch into tirades from his toilet or shower against people with plots against him, against a whole horde of journalists (his favourite being Cape journalist Jean Oosthuizen) and truly take a turn through insanity. Whether this was real or affected madness is difficult to say. Decide for yourself, if you have the stomach.
— Ali van Wyk (@NcaRoeker) October 31, 2024
Money was perhaps not the target
A good journalist friend, who spent significant time following Liebenberg around over the years and got to know him reasonably well, says everyone misunderstands Louis I of Bronkhorstspruit. He says people think Louis is after money, but that's not true. OK, he wouldn't mind having as much cash flow as a billionaire, but for Louis I it's much more about the fame and attention and adrenaline and the whole experience of the dangerous trip.
He says Louis knew from the start exactly where the kind of activity he was involved in would end, and that probably he'd eventually get a substantial prison sentence. But, he says, Louis didn't care, because with his mouth and skills Louis would be able to maintain a decent lifestyle even in prison, and he'd get lots of time off his sentence for good behaviour, and before you knew it old Louis would be somewhere in a small town busy with a new story of hope and investment. It still beats working. Eventually, he'd again hold up his middle finger to all his enemies.
The question I want answered is this: If Louis Liebenberg had listed his company with ten diamond mines on the JSE in 2016 and sold a few hundred million rand worth of shares (he can clearly sell shares), and could have manipulated himself into the position of chairman of the board of directors, or even as chief executive, with a salary of R5 million per month, and his company eventually went under debt administration in 2024, wouldn't he have been much better off with the money he could have set aside than what he's doing now? He could even have afforded a retirement cottage in Koingnaas.
♦ VWB ♦
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