He is the man every sports betting gambler dreams of meeting; Ronald Karauri – CEO of multi-billion company Sportpesa.
The former Kenya Airways pilot quit his lucrative job and reportedly invested Sh25 million, after selling a piece of land, to start the sports betting company with other shareholders.
The former secretary general at Kenya Airline Pilots Association also has a 6% stake in Sportpesa, making him one of the wealthiest people in Kenya.
Karauri spoke to the Nairobian about Sportpesa, betting, quitting his Captain job and how he deals with slay queens.
Betting has destroyed careers and broken families. How does that make you feel?
That is your imagination. It could be one or two cases, but I have not come across these ‘problems’ that people are trying to create.
Most of the stories are speculative and cannot be verified. Besides, in a society, some people will always misbehave. It is important to exercise responsibility.
Do strangers, family and friends approach you to advise them how to win?
Everyone, not only relatives! But there is no secret. In sports betting, the only way to make it is sticking to integrity.
People bet because they know there is no way you can manipulate the outcome, and that is why for us, we have remained transparent. For those who approach me, I just tell them there is no secret to winning a jackpot.
How come only poor people win jackpots?
According to trends, the jackpot is won by the less fortunate. I don’t know why, probably God has decided this segment of society deserves to win. Surprisingly, most of the jackpot winners placed only one bet.
How was the idea of SportPesa conceived?
I was in a casino when the idea came about. The casino is very interesting because you meet so many people and I was the only one who was flying. The idea was started by one of the people at the table.
I got really interested and told him, ‘you know what, I am really interested and would like to join you. So, initially I was one of the few people who bought the idea because at that time, not many people could see it. Some people joined much later.’
There is always a surge of betting and pyramid schemes around election time. What is the connection?
There is no connection, for sure I have not noticed. Probably guys are just trying to make money out of the existing opportunities. However, there is a misconception that betting is a kind of money laundering scheme.
For us at SportPesa, in terms of regulation, there is a lot of scrutiny.
You threatened to pull out of Kenya because of taxes…
The 35 per cent taxation of revenue before deducting operating expenses is too high. People confuse us for a lottery, but there are days at SportPesa when our balance sheet is negative.
Look, I have 300 staff, so if you tax me, including the expenses, where do I get their salaries? Remember, I pay 30 per cent corporate tax. My argument is that there is no reason to tax my expenses.
So you not moving?
No. In fact, we have presence across the globe. The point we are trying to make is that you cannot sustain a business with such an unfriendly tax regime, unless you fire some employees. We are in court over the matter.
You are the pioneers, but suddenly there are so many betting firms…
They came up maybe because of our success. Of course, competition affects business….the cake has been split into 10 pieces. For us, we have been consistent. People trust SportPesa. We are okay, we are not complaining.
Why do you support sport and not cancer, conservation, fistula etc?
We decided to focus on sports. In fact, what we are doing in terms of corporate social responsibility is a lot. If we are to start chasing too many things, we are likely to lose focus.
Your father, Adams Karauri was an educator, MP and minister. Did he warn you against ‘pata potea’ and betting when you were young?
Obviously, when you are young, you are warned against almost everything, but as you grow up, you start making independent decisions. The perception is that betting is a bad thing, but SportPesa will be there whether I am here or not.
Would you encourage your children to bet?
Kids? No, I can’t encourage them to do these things, they are not yet 18 years.
When people hit the jackpot, many friends emerge. How should they deal with that and the fame?
Everyone has an idea on what to do with the money. There is no person who doesn’t have an idea. We encourage them to rely on the advice of professionals who can guarantee that the money will be well utilised. We give financial advice, but ultimately, it is your choice to decide on what to do.
You are young, handsome and rich. How do you deal with slay queens?
(Laughs) That is a perception about me. I guess I don’t hang around where the so-called slay queens are found. I have a wife and don’t face the problem of being approached by slay queens.
Besides your love of cars, what else do you blow your cash on?
I like cars. I also like watches. I have a collection, but I don’t want to disclose much.
You were a KQ pilot, why did you quit?
You know, as the boss at KALPA (Kenya Airline Pilots Association), I was deeply involved in fighting the likes of Mbuvi (then KQ boss Mbuvi Ngunze), so I did not quit immediately when the business started.
But later on, as the business grew in terms of capacity, because we needed to have someone in charge. Instead of hiring someone with experience, which is not easy to find, I decided to quit in 2014. It is not that I didn’t want to quit, but the way things were, I had to. It was a big change, I now come in the office early in the morning.
Why do pilots drink too much?
We have about 500 pilots at KQ but only a few drink. It is their work schedule that makes the public conclude they drink a lot.
A pilot working between Friday to Monday goes off duty for the reminder of the week during which he may decide to drink. This is why people assume that pilots perpetually indulge in alcohol even on working days, which is false. My colleagues are responsible.