4Sight brings together digital entrepreneurs looking for path to stock-market validation 9/8/17, 5)59 PM

4Sight brings together digital

entrepreneurs looking for path to
stock-market validation
Business Day speaks to co-founder and CEO
Antonie van Rensburg

4Sight Holdings, which bills itself as a technology pioneer in fourth industrial

revolution, is planning to list on the JSE’s AltX next month, and is hoping to
raise R300m from investors – presumably those who are comfortable with
concepts such as bio-informatics, econometrics, artificial intelligence (AI)
and block chain.

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Business Day spoke to its cofounder and CEO, Antonie van Rensburg.

Warren Buffet exhorts us to invest in businesses we understand …

if you had to explain yourselves to a simple retail investor, what
are you?

4Sight invests in Industry 4. So the fourth industrial revolution is turning

your physical world into a digital one through sensors, data analytics, etc.
Now we acquire companies that create intelligent algorithms in those digital
worlds which allow you to make better decisions — whether you need to make
more money, increase productivity — those are the type of algorithms in
which we invest.

To give you a practical example, our main acquisition that we’re taking to
market wrote an algorithm on a telecommunications network that allows
people to get better pricing deals.

Are you buying the technology, or developing it too?

We are buying the companies with the tech. Because it’s such a fast-moving
environment, we’ve got to purchase companies that have already built
platforms and some of these technologies. My future vision is that 4Sight will,
with the listing, be involved in smart communication networks; digital media,
and we are building a platform around smart homes and smart buildings.

Our next set of acquisitions will focus on smart factories, then we’re going to
move into financial services, agriculture and healthcare. Each of those
verticals will have their own specific functions, expertise and the way people
run technologies inside those businesses.

Most of these engineers and scientists have been doing this for 10 years. They
have the ability to deploy technologies such as machine learning, AI, block

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chain – all the stuff you read about. We’re bringing all these people together
in those vertical applications.

What is your background?

I did my PhD in engineering in 1996, around the ability to translate a physical

world into a digital world … so I was about 20 years before the technology
enabled us to do that. About two years ago, nobody talked about Industry 4,
nobody talked about digitisation of businesses, we were only [starting] to be
exposed to Uber … and I’ve been trying to make these things work in the past
10 years. We’ve been creating a data analytics company that builds bespoke
solutions for customers.

So we saw this wave coming and in the past year we’ve seen an explosion in
terms of people talking about digitisation; all the executives now have this on
their strategies. We’ve tried to create partnership models with a lot of
companies. About six months ago I said to my mergers and acquisitions
partner, we’ve got to bring these things to the market right now because
everybody wants to do this, but there are very few people in the market who
understand it.

Taking this to market was the only way I could really convince most of these
tech companies to join up with us.

Indeed. Why do you need to be listed at all?

Most of the companies we have acquired have also been approached by the
EOHs, the Didatas, but none of those guys could offer them, I think, a vision
where they could bring all these components together. Second, all the guys
are entrepreneurs, they are technically orientated.

That’s what I can bring to the table. I can talk to these guys, understand what

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they do. It’s quite amazing to put a chemical engineer next to a radio engineer
and see the interaction. For example, a chemical engineer and a mechanical
engineer developed an AI system that could predict failures in a production
process, but a radio engineer says I can use this technology to predict when a
base station might fail. That’s what we brought to the table.

How are you going to raise the R300m you’ve targeted?

We’ve [completed] the initial funding for the listing – myself and two
partners. We’ve raised R20m, and then we’re doing an initial public offering
(IPO). Our prospectus will be approved by the JSE on Monday and we’ll go
through an IPO process over the next four weeks and list in the first part of
October.

Have you got any institutional backers lined up?

We’ve already done presentations [to fund managers], as well as to individual

technology entrepreneurs. Because its initial market cap will be about R1bn it
does restrict the large institutions to invest.

How do you arrive at a R1bn market cap?

[We’ll have] just under 500-million shares at about R2 a share. We did our
first acquisition in July – we bought a company called Digitata, an
international analytics company. It has about 40 telco operators as clients
and 90% of its income is dollar-based. It’s based in Mauritius, and we’ve also
established 4Sight Holdings as a Mauritian company. Our next set of
acquisitions [are] in mining and manufacturing and most of the revenue also
comes through Africa, Australia and the Americas.

Is Digitata profitable?

Yes, it’s profitable. All the businesses we have acquired are profitable. They
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all typically earn 50% of their revenue through licensing agreements.

talevig@tisoblackstar.co.za

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