Arrington talks with Whisper co-founder Heyward and Botha from Sequoia Capital about Whisper’s business model and impact, whether celebrity gossip counts as whistleblowing, and whether CrunchBase should be spun off from AOL. Heyward:
Whisper is all about creating a place of authenticity and a place of openness
Botha talks with the magazine about being the youngest qualified actuary in South Africa, working at PayPal and investing in Youtube, and how he spends free time. His vision for the next 10 years:
From a career perspective, I would be most proud of the companies that I am involved with today and companies that I will support in future being enduring businesses in 2024.
Botha is interviewed for the San Jose newspaper about billion-dollar deals and how he got into tech. He says that before joining PayPal:
I’d no idea what venture capital was.
Google buys the video sharing platform for $1.65 billion in stock, earning Sequoia a 65-fold return on its investment of $8.5 million. Botha:
I am inspired by the impact [companies like YouTube] have on the lives of hundreds of millions of people across the globe.
Botha talks with the magazine about how tech companies are viewing M&A as an attractive exit option, and his investments in Youtube and PayPal. He says PayPal might have become more valuable if it had stayed independent:
In retrospect, selling it for $1.5 billion seems like a mistake
Botha provides $8.5 million in funds from Sequoia Capital for a 30% stake in the company, founded by two people he worked with at PayPal.
Sequoia was their first investor – I took a board seat and helped grow the business.
Botha joins the venture capital firm:
Sequoia invests in very early stage companies and helps them blossom.
Botha develops a bottom-up financial model to help understand PayPal’s business, and finds that identity fraud is costing the company millions of dollars each month:
I was trying to work out how long it takes on average for fraud to be notified. I realised that our losses were much larger than we had believed. I quantified the size of the problem and spurred engineers to build frameworks for fraud control. We caught the problem early and saved the company from bankruptcy…After identifying the fraud problems, we used logistic regression analysis to build the initial fraud models to predict whether a new user was a good or bad user.
Botha negotiates the company’s sale to eBay as its CFO.
I get a thrill from watching companies thriving in the long-term in the way that PayPal and YouTube have done. I am inspired by the impact they have on the lives of hundreds of millions of people across the globe.
Botha leads the company through its IPO, and says this is his toughest business challenge. Musk:
[He] did a great job managing the finances and internal cost structure and took PayPal through a very difficult public offering as CFO
Botha becomes the company’s CFO:
I try getting in front of as many opportunities as possible, but in the late ’90s, I had no idea that I’d end up being CFO of a technology company. I’d no idea what venture capital was.
Roelof obtains an MBA from the graduate school of business.
When I was accepted at Stanford it was a great opportunity to live abroad for a few years, compete against the best and take on a fresh challenge.
Botha joins the company as corporate development director, while still in grad school. He initially accepts the offer because he had run out of money after the 1998 emerging currencies crisis:
I didn’t have money to pay rent one month. I borrowed money from friends and family. It was embarrassing to be in that position. When the third offer from PayPal came around, I accepted it so that I could work part-time for three months before graduating.
Botha is the youngest person in South Africa to qualify as a fellow at the Faculty of Actuaries. Botha:
I was thrilled! However it paled in comparison to the thrill of being able to pass first time and the stress of waiting many months for results to be published.
Botha joins the management consulting company as a business analyst.
One of my colleagues at McKinsey was a Stanford graduate and he convinced me that I should at least apply for a post-graduate programme in the U.S.
Botha graduates with a Bachelors of business in economics, actuarial science, and statistics. He has the highest grades in the history of the program.
Botha enrols in a Bachelor of business program at the University of Capetown to study actuarial science, economics, and statistics.
Roelof Frederik Botha is born in Pretoria. His parents are Helena Maria van Deventer and Roelof Frederik Botha, Sr, a well-known economist. He is the grandson of Roelof Frederik ‘Pik’ Botha, the South African politician.
In South Africa I grew up in the shadow of a well-known father and grandfather. I had the top results in the province when I finished high school. ‘Botha’s grandson is number 1’ was the headline carried in the local newspaper. Psychologically, I was driven to make my grandfather proud and accomplish something in my own right.