Depois de algumas notícias sobre a oficialização como sócio da De Beers Group, o Minas de Angola bateu a sua porta e, apesar do seu tempo apertado, o empresário prontamente abriu, acomodou-nos no seu escritório para esta entrevista, onde, entre vários assuntos, falou sobre o que realmente envolve a parceria com a De Beers, expansão do seu negócio, investir em Angola e como funciona o mercado da joalharia! Acompanhe!

We know that your journey in the Diamond Industry began in 2005. Afterwards, you took on the leadership of several important organizations. Co-founded and directed the South African Young Diamond Beneficiators Guild. You are currently President of the South African Diamond Dealers Club and owner of Molefi Letsiki Diamonds. How did you manage to get here?

The journey started with my curiosity for wanting to know what the life cycle of a diamond is from when it is mined to when it is manufactured and finally in the hands of the consumer. With that curiosity I then set a clear vision for myself for how far and where I want to get to in the industry. This enabled me to decide what role I would play in the industry, and how I would become a significant distributor not just locally but globally. The more my journey in the industry unfolded I realized that it isn’t a level playing field and that informed my decision to become a member of the different industry bodies we had available and even co-found one. These leadership positions in the different industry bodies allowed me to realize my vision of serving and creating opportunities that make for a conducive environment for us all to thrive.

Whenever you look back at how and where you started what comes up to your mind?

Looking back, I marvel at how completely different the industry is compared to when I first started, from having “Diamond markets”, and now “tenders”. We no longer manufacture to only make profit, but we are intentional about buying diamonds that have provenance and make a difference in the communities that they come from. What has also prominently changed is the sentiment behind why the customer buys the diamond, people aren’t just looking to buy the product for the sake of buying it anymore, now they want the story behind the business and the product, which will speak to the heart of the consumer, this means that in some instances profit is determined by how solid the story behind the business is.

Molefi Letsiki Diamonds that last February was made official as the first black majority-owned company to achieve De Beers Sightholder status. How was it possible to complete this deal?

Becoming a De Beers sightholder has been a long-time dream, one that if I’m honest I didn’t think I would achieve in my lifetime. It has been a long journey, one that took a lot of work, determination and setting clear goals and milestones. When De Beers came up with the enterprise development program, I was fortunately one of the people chosen to take part in it. The program which became a steppingstone for where we are now, offered us entrepreneurship education, the opportunity to be supplied with rough diamonds by De Beers directly, and it also gave us access to industry leaders and people who were sight holders at the time who provided mentorship. This experience added to my expertise in the industry allowed me to create a roadmap on how I could get to sight holder status. Achieving this milestone has made me realize that the work is just beginning and that this isn’t the peak.

What are the rights and obligations of this corporate structure?

The rights include access to diamonds from De Beers, which enables my diamonds to have provenance and in turn means access to a broader market. Our obligations include being compliant and ensuring that our business is reputable and adheres to good business practices.

So It means that Molefi Letsiki Diamonds are really a partner of the De Beers Group. How much is your participation worth and how does this work in practice?

Being a De Beers sight holder means in essence that Molefi Letsiki Diamond Holdings is a top tier client who De Beers supplies with a certain quality and quantity of diamonds, which enables me to predict what I can manufacture and sell. My participations in then one of a buyer who has access to that quality and quantity of rough diamonds supplied by De Beers, which I wouldn’t if I wasn’t a sight holder.

Molefi Letsiki Diamonds operates mainly in the manufacture of diamonds and personalized jewelry. How would you describe the behavior of consumers over these 17 years in the market?

Consumer behavior has changed over the years, whereas 17 years ago people just bought diamonds because they thought they were beautiful and just loved them, now they attach meaning and sentiment to their purchases, more and more the customer is buying the experience and not just the product. 17 years ago, consumers considered diamonds as products that only a certain class of people owned, but over the years consumers in particular Black consumers attitude towards diamonds have changed, they now realized that diamonds can be bought at any price point and that it’s not just for the elite. Black customers are now buying and investing in diamond jewelry for themselves, they are not just buying to gift other people. I see a lot of women who in the past would be the ones receiving diamond jewelry now buying it for themselves either to dress up or celebrate milestones. This change in consumer behavior is also what informs my desire to teach on diamonds, and in particular the buying of diamonds by people of color.

In general, how do these types of businesses work in Africa?

Africa has always been where diamonds are mined, and produced, then they would be exported overseas for manufacturing, but over the years that has changed and more and more indigenous people in African country’s run their own factories to manufacture. Diamonds are now being manufactured by the very people who mine and produce them and get to sell them both locally and internationally. In essence Africa remains the producer and manufacturer but now more than ever we have become the consumers of the diamonds.

What are the risks?

There are many risks involved because ultimately this a luxury good and something that people can survive without, diamonds are purchased for sentimental reasons, which at least means you become a part of whatever story that is, but essentially it’s not a need and this means when times are tough economically it would be the first to fall of the lists of people. You can sometimes have stock for a long period of time and the danger in that is the price fluctuating, either due to the rate of the currency at the time or a change in pricing, which could mean that over a period your stock could lose value. Diamonds are a natural product, so in the process of manufacturing the color could become one that is lower than what you had predicted, the diamond could also break, and many other things could happen to the diamond which could depreciate its value. So, the fact that it’s a luxury good, the volatility of the currency and it being a natural product are the major risks.

What are your biggest sales markets? Have you received Angolan customers? How often?

The overseas market, in particular Belgium, Paris, Israel, Hong Kong and the United States are my biggest markets for loose diamonds. Yes, I have done work with Angolan customers, in particular jewelry which came through referrals.

Investing in the diamond sector requires a very strong financial background. Not all entrepreneurs manage to open a mine, because of the high costs. How does this work in the jewelry market?

The diamond industry is very capital intensive and unfortunately in most parts of the world financial institutions are not looking to finance the industry. What has made a difference in my business is collaboration, partnering with the right people who can give you access to finances and resources that you otherwise would not have access to, in mutually beneficial partnerships. In my opinion collaborations enable you to navigate the challenge of raising capital.

In the last two years, the jewelery market has been almost silent due to the pandemic crisis. How is the jewelry market today?

In as much as the jewelry market has declined due to the pandemic, it also got people to appreciate one another and people in general, and this in turn ushered a big boom in sales after the pandemic, as people bought a lot of diamond jewelry which had a lot of sentiment and meaning attached to it, so the industry saw a steep increase in sales due to that. Right now, diamond jewelry is in direct competition with tech and travel because more and more people spend money on experiences, which means that sales right now are not as high.

What is the reality of Molefi Letsiki Diamonds?

Molefi Letsiki Diamonds is a manufacturing corporation, we sell loose diamonds, and are endeavoring to become a world class distributor globally. Our core business is buying rough diamonds, cutting and polishing the diamonds in house, then distributing the loose polished diamonds internationally. We also play an important role of educating people about diamonds, especially African people, because I believe the more people understand diamonds, we will see more local consumption. We are a company that started from the ground up and is still growing, and I believe that we will achieve the great heights we have set for ourselves, and we will tell good stories about Molefi Letsiki Diamonds going forward.

With market fluctuations. How have you managed to achieve the financial and economic objectives of Molefi Letsiki Diamonds?

The market fluctuations have been a challenge but like any other business we are able to make projections and this allows us to plan accordingly. We are sight holders which also means that we have consistent supply from De Beers, which ensures that we have stock even when the market isn’t that great. The fact of the matter if there is always a customer looking to buy something, which is why our business is not just focused on one aspect or market of the industry. There is always a market in the industry that one can leverage on when one market isn’t doing so great. The more you diversify your customer base the easier it is to navigate market fluctuations, and to mitigate the challenges it brings.

Does It make part of you thought expanding your business to the Angolan market or would you be interested in establishing a partnership with Angolan entrepreneurs?

As the corporation grows the intention is to expand our footprint, and with Angola’s recent comeback into the industry it is a market that I would like to have access to. This could possibly mean Molefi Letsiki Diamonds setting up a factory in Angola or partnering with diamond companies or entrepreneurs in the country in order to establish that market. That is something we would look at in the not-so-distant future as currently our focus is the new status of sight holder with De Beers, but we intend to do business in more parts of the world, which would include Angola.

If yes, what would be the conditions? If not, Why?

At the moment I don’t have any conditions which would inform the decision to expand into Angola, but when the time comes and I have familiarized myself with the country’s business environment, I would most probably have those conditions. The key thing for Molefi Letsiki Diamonds remains having access to the diamonds in a mutually beneficial agreement, one that would allow us to also make a difference in the communities that the diamonds are sourced.