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Cytonn Investments
Rank: Elder Joined: 7/26/2007 Posts: 6,514
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In 2016, I have an email from them offering me 18% for 1 year fixed funds, while the prevailing t bill rate for the same tenor was between 11 and 12%. I think they were a ponzi from the start, its just people did not catch onto it soon enough. Business opportunities are like buses,there's always another one coming
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Rank: Member Joined: 1/15/2010 Posts: 625
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This is one of those kind of investments where the people running the show will win regardless of whatever happens.
It's a game where at the flip of a coin,
Heads I win, Tails you Lose.
It's actually quite similar to how the guys at Centum were earning huge bonuses while shareholders have lost heavily. The management faces no downside when shit hits the fan but claims bonuses based on unrealized real estate "appreciation". When the real estate takes a hit of course they do not pay back the bonuses and the carry that they earned in the hey days. Lack of skin in the game by the management should be a huge warning signal to any serious investor.
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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KulaRaha wrote:In 2016, I have an email from them offering me 18% for 1 year fixed funds, while the prevailing t bill rate for the same tenor was between 11 and 12%.
I think they were a ponzi from the start, its just people did not catch onto it soon enough.
Chase Bank was offering up to 24%-26% on fixed deposits of 6 -12 months at that time. They simply took the money to Chase Bank took the 6%-8% margin plus a management fee of 2%. Life is short. Live passionately.
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Rank: Chief Joined: 1/3/2007 Posts: 18,084 Location: Nairobi
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mv_ufanisi wrote:This is one of those kind of investments where the people running the show will win regardless of whatever happens.
It's a game where at the flip of a coin,
Heads I win, Tails you Lose.
It's actually quite similar to how the guys at Centum were earning huge bonuses while shareholders have lost heavily. The management faces no downside when shit hits the fan but claims bonuses based on unrealized real estate "appreciation". When the real estate takes a hit of course they do not pay back the bonuses and the carry that they earned in the hey days. Lack of skin in the game by the management should be a huge warning signal to any serious investor. Not defending the huge bonuses at Centum but if you read (not skim) the Annual Report, the compensation is based on "cash returns" not "unrealized gains" though I may be mistaken. Perhaps with DJ CK's ill-health and death the results have not been released yet but Centum has until 30th June. Let's see what they present. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 7/8/2008 Posts: 947
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Rank: User Joined: 8/15/2013 Posts: 13,236 Location: Vacuum
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While I pulled out of Cytonn when they started selling caps and t-shirts. I believe cytoon is not a ponzi, Cytonn just happens to be cash strapped primarily caused by how they structured their investments to mature in 1 year yet the funds were being deployed in RE whose investment horizon should be more than 3 years for one o build and find clients. They should have required a min investment of 5 years to enable them build and sell the houses. If Obiero did it, Who Am I?
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Rank: Member Joined: 4/26/2011 Posts: 759
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My main concern is the fact that Cytonn hasn't secured short term bridge financing or even sell equity stake to a global private equity. Right now there is so much money is PE space that Cytonn shouldn't have to go to courts, delay payments and have their brand tarnished. Investing is based on trust and brand, once that's tarnished, it is hard to get it cleaned. Either Cytonn. 1. Doesn't have the foresight to comprehend 2. Or doesn't want to open their books for diligence need in order to get the capital Both are not good signs.
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Rank: Elder Joined: 12/2/2009 Posts: 2,458 Location: Nairobi
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I discovered most people here dont have inside scoops and are not as smart as they write. (not refering to you though) But for your information. They have turned down offers.. starting from local ones. Hizi kelele za kina Paul sio za bure Rollout wrote:My main concern is the fact that Cytonn hasn't secured short term bridge financing or even sell equity stake to a global private equity. Right now there is so much money is PE space that Cytonn shouldn't have to go to courts, delay payments and have their brand tarnished. Investing is based on trust and brand, once that's tarnished, it is hard to get it cleaned. Either Cytonn. 1. Doesn't have the foresight to comprehend 2. Or doesn't want to open their books for diligence need in order to get the capital Both are not good signs.
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Rank: Elder Joined: 12/2/2009 Posts: 2,458 Location: Nairobi
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Rank: Chief Joined: 1/3/2007 Posts: 18,084 Location: Nairobi
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sparkly wrote:KulaRaha wrote:In 2016, I have an email from them offering me 18% for 1 year fixed funds, while the prevailing t bill rate for the same tenor was between 11 and 12%.
I think they were a ponzi from the start, its just people did not catch onto it soon enough.
Chase Bank was offering up to 24%-26% on fixed deposits of 6 -12 months at that time. They simply took the money to Chase Bank took the 6%-8% margin plus a management fee of 2%. And the whole house of cards came crumbling down. Wow! When 1year T-Bills were 12%, Chase was offering 24%??? That was definitely not sustainable. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 1/15/2010 Posts: 625
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VituVingiSana wrote:mv_ufanisi wrote:This is one of those kind of investments where the people running the show will win regardless of whatever happens.
It's a game where at the flip of a coin,
Heads I win, Tails you Lose.
It's actually quite similar to how the guys at Centum were earning huge bonuses while shareholders have lost heavily. The management faces no downside when shit hits the fan but claims bonuses based on unrealized real estate "appreciation". When the real estate takes a hit of course they do not pay back the bonuses and the carry that they earned in the hey days. Lack of skin in the game by the management should be a huge warning signal to any serious investor. Not defending the huge bonuses at Centum but if you read (not skim) the Annual Report, the compensation is based on "cash returns" not "unrealized gains" though I may be mistaken. Perhaps with DJ CK's ill-health and death the results have not been released yet but Centum has until 30th June. Let's see what they present. All I'm saying is that if the returns available to management are materially different from the ones available to shareholders, then DO NOT invest. In Centum, shareholders have seen a steady drop in the price of their equity while during the same period, management earned huge bonuses. The only sensible compensation mechanism to do would have been to tie bonuses to the performance of the Centum share so as to ensure that management and shareholders are always in the same boat. It's that simple. Even better would be to ensure that management takes a cut when the share goes into loss territory just like shareholders do. That way, management and shareholders are truly in the same boat. But there's a lot of suckers out there who can't keep their eye on the ball i.e. shareholders returns. Everything else is noise.
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Rank: Chief Joined: 1/3/2007 Posts: 18,084 Location: Nairobi
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mv_ufanisi wrote:VituVingiSana wrote:mv_ufanisi wrote:This is one of those kind of investments where the people running the show will win regardless of whatever happens.
It's a game where at the flip of a coin,
Heads I win, Tails you Lose.
It's actually quite similar to how the guys at Centum were earning huge bonuses while shareholders have lost heavily. The management faces no downside when shit hits the fan but claims bonuses based on unrealized real estate "appreciation". When the real estate takes a hit of course they do not pay back the bonuses and the carry that they earned in the hey days. Lack of skin in the game by the management should be a huge warning signal to any serious investor. Not defending the huge bonuses at Centum but if you read (not skim) the Annual Report, the compensation is based on "cash returns" not "unrealized gains" though I may be mistaken. Perhaps with DJ CK's ill-health and death the results have not been released yet but Centum has until 30th June. Let's see what they present. All I'm saying is that if the returns available to management are materially different from the ones available to shareholders, then DO NOT invest. In Centum, shareholders have seen a steady drop in the price of their equity while during the same period, management earned huge bonuses. The only sensible compensation mechanism to do would have been to tie bonuses to the performance of the Centum share so as to ensure that management and shareholders are always in the same boat. It's that simple. Even better would be to ensure that management takes a cut when the share goes into loss territory just like shareholders do. That way, management and shareholders are truly in the same boat. But there's a lot of suckers out there who can't keep their eye on the ball i.e. shareholders returns. Everything else is noise. The problem with with compensation schemes/plans is determining the ideal structure. The price of the shares may not reflect value of the shares. This could go either way i.e. over-priced or under-priced. The price could outrun intrinsic value (think Tesla) or lag (think of numerous firms including Berkshire Hathaway) the value. Warren Buffett on executive compensation https://www.gurufocus.co...utive-compensation-pt-2
For Cytonn, as a private firm, we do not know how the compensation of the executives works. It seems clearer for Centum. For ARM, PP was compensated well, but he also had most of his wealth in ARM shares. He lost all/most of the latter so in a weird way he was sort of aligned with shareholders. Now to tackle "Shareholder Returns". The challenge is these depend on the period chosen. Safaricom for a while (2-3 years) has an awful Total Shareholder Return. Then it exploded. EABL has great shareholder return for a specific period (2002-2007) and then it imploded. Ultimately, the firm has to perform well financially regardless of the share price and distribute the profits in some form be it via dividends, share buybacks or ultimately a sale of the firm eg KK. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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sparkly wrote:sqft wrote:sparkly wrote:They have apologized, they have pulled down the story. There is still the matter of damages (cash payment) upon proof of damages by Cytonn. Keep us posted and try to avoid digging yourself in the same hole. The money you receive to smear Cytonn name will not be enough to pay them damages. will they also sue all the other media houses who have written all those articles listed above? I predicted that people would sue. Now @PK is running around reporting how people have sued! Sparkly wrote:Whistle blowing on what? You went to Cytonn, you signed an investment CONTRACT with them. If they don't fulfill their end of the bargain, you sue for BREACH of contract. In legal jargon this kind of a suit is called a "personam suit" i.e. you sue a particular person for the breach. This is to say there is nothing like whistle blowing on personal contracts. The most you can do is alert fellow netizens if something dodgy is going on and let everyone carry their burden. My next predictions:- 1. Cytonn Funds will not survive the run on assets. Pole for the investors. 2. The regulated funds, structured as Collective Investment schemes will face massive loss of capital. People will be lucky to get out 50% of what they invested. 3. The unregulated funds are worse of without ring-fencing and any security. Total write-off is likely. 4. There will be no fraud prosecutions on Cytonn directors. 5. Fund Investors will have no recourse on the real estate projects. There are priority interests on the real estate. I said people should sue. I am vindicated... https://www.google.com/a...ss-suit-12125211/%3famp
Life is short. Live passionately.
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Rank: Member Joined: 1/19/2016 Posts: 204
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https://twitter.com/win_...408696360933670915?s=20
Cytonn blocking investors from joining the AGM. Yet another under the table move from conmen.
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Rank: Chief Joined: 1/3/2007 Posts: 18,084 Location: Nairobi
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I am growing fat on all popcorn I eat watching this show! Court has suspended CMA's action against Cytonn. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 3/16/2019 Posts: 313
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VituVingiSana wrote:I am growing fat on all popcorn I eat watching this show!
Court has suspended CMA's action against Cytonn. Na bado! The plot thickens. MPs to quiz CMA boss over Cytonn investors’ queriesK
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Rank: Elder Joined: 12/2/2009 Posts: 2,458 Location: Nairobi
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This is good and welcome... Finally CMA which played a good lead in trying to run down Cytonn will explain a few more things. and how other fund managers have not been highlighted for making billions of losses in their private unregulated products.. I hope Paulkimani and his team had prepared for an endgame apart from just trying to buy Cytonn's Real Estate portfolio from the back channels and trying to cause a run. All of them should face Parliament.. all should be laid bare..
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Rank: Member Joined: 1/19/2016 Posts: 204
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Lol. Cytonn has always been a scam. From day one when they stole billions from Britam. I’ll post this again: https://twitter.com/Moha...409195469297831942?s=20
They’re a scam, they will get away with making thousands of Kenyans homeless, more thousands bound to unemployment and no education meaning their children - aka the next generation will suffer the same fate. Random kids here said I was praying on sympathy. Look at the link. I was not. Cytonn is heartless, they knew they were stealing from the public and there is nothing else to be said. The only thing they have are lawyers who will get them free - no matter how guilty they are. And they are guilty. It’s the money of investors that are paying for Cytonn lawyers and the Cytonn four - Edwin Dande, Patricia Wanjama, Shiv Arora (CEO Superior homes so beware that’s also a scam- they May not have a “Paul kimani” to warn them)- not that anyone listened for the 6 years I warned you about Cytonn! and Elizabeth Nkuku poundfoolish wrote:This is good and welcome... Finally CMA which played a good lead in trying to run down Cytonn will explain a few more things. and how other fund managers have not been highlighted for making billions of losses in their private unregulated products.. I hope Paulkimani and his team had prepared for an endgame apart from just trying to buy Cytonn's Real Estate portfolio from the back channels and trying to cause a run. All of them should face Parliament.. all should be laid bare..
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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paulkimani wrote:Lol. Cytonn has always been a scam. From day one when they stole billions from Britam. I’ll post this again: https://twitter.com/Moha...409195469297831942?s=20
They’re a scam, they will get away with making thousands of Kenyans homeless, more thousands bound to unemployment and no education meaning their children - aka the next generation will suffer the same fate. Random kids here said I was praying on sympathy. Look at the link. I was not. Cytonn is heartless, they knew they were stealing from the public and there is nothing else to be said. The only thing they have are lawyers who will get them free - no matter how guilty they are. And they are guilty. It’s the money of investors that are paying for Cytonn lawyers and the Cytonn four - Edwin Dande, Patricia Wanjama, Shiv Arora (CEO Superior homes so beware that’s also a scam- they May not have a “Paul kimani” to warn them)- not that anyone listened for the 6 years I warned you about Cytonn! and Elizabeth Nkuku poundfoolish wrote:This is good and welcome... Finally CMA which played a good lead in trying to run down Cytonn will explain a few more things. and how other fund managers have not been highlighted for making billions of losses in their private unregulated products.. I hope Paulkimani and his team had prepared for an endgame apart from just trying to buy Cytonn's Real Estate portfolio from the back channels and trying to cause a run. All of them should face Parliament.. all should be laid bare.. Very emotional about money matters. Usiweke hii mambo kwa roho kijana, utakufa ukiwa mdogo. Life is short. Live passionately.
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Rank: Elder Joined: 12/7/2012 Posts: 11,908
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paulkimani wrote:Lol. Cytonn has always been a scam. From day one when they stole billions from Britam. I’ll post this again: https://twitter.com/Moha...409195469297831942?s=20
They’re a scam, they will get away with making thousands of Kenyans homeless, more thousands bound to unemployment and no education meaning their children - aka the next generation will suffer the same fate. Random kids here said I was praying on sympathy. Look at the link. I was not. Cytonn is heartless, they knew they were stealing from the public and there is nothing else to be said. The only thing they have are lawyers who will get them free - no matter how guilty they are. And they are guilty. It’s the money of investors that are paying for Cytonn lawyers and the Cytonn four - Edwin Dande, Patricia Wanjama, Shiv Arora (CEO Superior homes so beware that’s also a scam- they May not have a “Paul kimani” to warn them)- not that anyone listened for the 6 years I warned you about Cytonn! and Elizabeth Nkuku poundfoolish wrote:This is good and welcome... Finally CMA which played a good lead in trying to run down Cytonn will explain a few more things. and how other fund managers have not been highlighted for making billions of losses in their private unregulated products.. I hope Paulkimani and his team had prepared for an endgame apart from just trying to buy Cytonn's Real Estate portfolio from the back channels and trying to cause a run. All of them should face Parliament.. all should be laid bare.. PK, you warned the investors over 6 years so why are you still crying for them. Let the world teach them. We all have passed through such right of passage. Remember, Cytonn is still getting more investors. How do you help such people. In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
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