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Cisneros: A Change of Guard
Adriana Cisneros becomes CEO of the Cisneros Group, a
multilatina pioneer that is expected to focus more on technology.
BY JOACHIM BAMRUD
Last week’s appointment of Adriana Cisneros as CEO of the Cisneros
Group of Companies represents several milestones. She is the third generation
Cisneros to take the helm of the global media conglomerate. And the first
woman. Last, but not least, the appointment had been expected for some time and
represents a model transition of a Latin American family company.
“I
am very proud to appoint Adriana as Cisneros’s CEO,” Cisneros Chairman Gustavo Cisneros tells Latinvex.
“While the succession has been a natural step, this was a process that was well
organized and properly planned. During the past seven years, Adriana has been
preparing for this moment, and in her role as Vice Chairman and Director of
Strategy, she has more than demonstrated this… I am sure this is the right
moment and under her leadership Cisneros will continue to explore new paths,
and with the support of a great legacy and the ideal team, she’ll successfully
confront any challenge.”
The appointment has been well-received by
close observers of the company. “She is a talented leader who has been
preparing for this job for a long time,” says Moises Naim, a senior associate in
Carnegie’s International Economics Program who served as Venezuela’s trade and
industry minister in the 1990s.
The Cisneros Group owns or holds interests in more than 30 companies
that combined serve 550 million customers in over 100 countries. Its businesses
range from broadcast television, television production, Internet ad sales and
telecommunications to real estate. Although
Venezuelan in origin, the Cisneros Group now has its headquarters in Miami.
The 33-year old Adriana Cisneros started working at the Cisneros Group in 2006
and since 2010 she served as Vice
Chairman and Director of Strategy. “Over that time period she has
taken significant decisions such as the creation and development of an Internet
strategy while supporting her father in the restructuring exercise of the
Cisneros Group,” says Beatrice Rangel,
CEO of AMLA Consulting and a former vice president at the Cisneros Group.
Gustavo Cisneros will continue in his role of Chairman,
while Steven Bandel – the CEO of the Cisneros Group the past four years – will
serve as Co-Chairman. Adriana calls Bandel “a great CEO who will continue as a
member of my team of advisors.”
FOCUS AREAS
As CEO, Adriana Cisneros will focus on continued global
expansion. “We are consolidating our global expansion, our incursion in the
digital world, and our real estate development,” she tells Latinvex.
Cisneros plans to focus on four strategic pillars. First, consolidating new methods of
distributing content while continuing to be a leader as an integrated
multiplatform production company, spearheading the development of original
content for Hispanic markets.
Second, diversifying risk with the creation
of new business divisions and focusing on her three newest divisions. Third, investing
in innovation by identifying entrepreneurial digital projects in the region,
and exploring new ways of doing business. And fourth, having a dedicated vision
to Corporate Social Responsibility.
As Director of Strategy, she oversaw the transformation of television
programming into 360° concepts, via digital strategies.
“Over the past few years we have converted our television content into 360°
concepts with digital strategies, allowing us to get even closer to our
audiences and offer them better experiences through the different platforms,” Adriana
Cisneros says.
She was responsible for the creation in 2011 of Cisneros Interactive, the
company’s digital media division, focused on mobile and online advertising
networks, e-commerce, social gaming, and crowd-funding. She is a private
investor in NXTP Labs, an
acceleration program that invests in Spanish-speaking
technology startups that are pursuing global or regional opportunities.
Cisneros is betting big on digital
advertising. Last year, it created
RedMas, an online advertising network with 60 million unique users in Latin
America and the U.S. Hispanic market and the exclusive representative of Yahoo!
in Venezuela and Peru. In September RedMas acquired Argentine online
advertising company Kontextua. Then in January this year, Cisneros acquired
Adsmovil, the largest mobile ad network to serve the Hispanic community in the
United States and Latin America in both Spanish and Portuguese.
Meanwhile, in April the Cisneros Group announced a $20 million investment in in
Mobly, Brazil’s leading
home furnishings webstore and part of Rocket Internet’s corporate
portfolio.
Mobly boasts more than 6 million visits per month after less than two years in
operation.
Last
year, the Cisneros Group also formed a partnership with Colombia-based Cuponidad to launch its online offer of services,
products and travel packages at discounts in Venezuela. The
Cisneros Group has also invested in Idea.me, a crowdfunding website that covers
Latin America, and Queremos, a fans-funding site for concerts and events.
“Adriana
Cisneros [is] quite savvy about the changing media landscape as the proportion
of our lives that evolves within cyber space,” Rangel says. “This is key to a
successful development strategy for entertainment services. As a
conspicuous member of the pre generation C demographics, Adriana understands
the entertainment cum information and education needs of our days which
increasingly rely on cyber services to fulfill needs and aspirations in these
areas.”
In April, Variety magazine included
her among the 50 most influential New Yorkers who are currently revitalizing
entertainment through constant innovation into the digital arena, through
social media, mobile game apps and interactive television content strategy. “As a key
exec of one of the largest media congloms in the world, the 81-year-old
Cisneros Group of Companies, Ivy League-educated Adriana Cisneros has worked
alongside her father, company chairman Gustavo Cisneros, to bring the
Venezuelan conglom into the digital arena, adroitly tapping social media,
mobile game apps and creating an interactive strategy for the company’s TV
programs,” Variety said.
Adriana Cisneros also established the real
estate division anchored by Tropicalia, a $2 billion sustainable tourism development
in the Dominican Republic that is expected to create 14,000 jobs. She has
frequently visited the project, including schools financed by the Tropicalia
Foundation.
“Tropicalia is one of
the four fundamental pillars of my strategic business plan,” Adriana Cisneros
says. “It is one of the Cisneros’s most ambitious projects serving as the
launch pad of our new real estate division. Just as I have been doing from the
start, I will continue to work very closely with both the business unit team at
our corporate offices and the team in the Dominican Republic to consolidate the
project and its potential.”
Tropicalia is
scheduled to open in 2016 with a Four Seasons Hotel and Tom Doak golf course. A
second property, developed together with Auberge Resorts, is planned for a
mid-2017 launch.
Multicultural
and cosmopolitan from birth, Adriana seems to embody her grandfather's original
concept of "crosspollination" - that is the interaction of
many different talents in developing any successful initiative, says Antonio Herrera-Vaillant, executive director of the Inter-American
Competitiveness Experience Network. “In her case, she can provide a fluent and
integrated approach that blends information, education and culture into new
forms of communication that mutually strengthen each of these fields,” he says.
CISNEROS GROUP
The Cisneros Group’s key asset is Venevision, a Venezuelan broadcaster that
exports soap operas worldwide, including such far-way markets as Iran and
Afghanistan. Its foreign partners
include China Central Television.
In the United States, the Cisneros Group provides Univision, the top
Spanish-language broadcaster, with 40 percent of its content. One example: The Eva Luna soap opera, which drew 9.7
million viewers to its finale on Univision in April 2011. It became the
second-most-watched program in the United States in the coveted 9 p.m. time
slot and the highest-rated domestically produced telenovela in history, according to the Cisneros Group. Cisneros
previously owned a stake in Univision and played a key role in its recent
success among US Hispanics.
Cisneros also owns the
Miss Venezuela pageant, which is broadcast in more than 20 countries in part
due to its successful track record for ultimately producing the most Miss
Worlds of any country (winning six times since 1951, most recently in 2011 with
Ivian Sarcos.)
Meanwhile, in a joint venture with investment fund Hicks, Muse, Tate & Furst and Latin American Internet company El Sitio, the Cisneros Group owns Claxson Interactive Group, which broadcasts content from Playboy TV to Latin America.
Cisneros also owns Cerveceria
Regional, the second-largest brewery and beer distributor in Venezuela; Pueblo,
one of the leading supermarket chains in Puerto Rico and the U.S. Virgin
Islands; Venezuelan beauty products manufacturer Laboratorios FISA; Venezuelan
travel agency SAECA, Venezuelan communications company Americatel and a stake
in Venezuelan baseball team Los Leones.
Privately held, the Cisneros Group doesn’t publish annual sales numbers, but
according to Bloomberg
it posted 2010 revenues of $1.5 billion and employs 8,000 people.
“Cisneros is benefiting from a period of high growth potential in both the
expansion into new markets and the diversification of its business divisions,”
Adriana Cisneros says.
A FEMALE CEO
The appointment of Adriana Cisneros is expected to
provide a boost to those advocating more female heads of companies in Latin
America.
“The appointment of Adriana Cisneros as CEO of such an important Group is
excellent and very important for women in Latin America and frankly globally,”
says Susan Segal, President and CEO
of the Council of the Americas/Americas Society, which includes major
corporations that do business in Latin America. “Adriana has become a role model
for women throughout Latin America. Her leadership and achievements sets a
standard for young women to follow. She is an important example of a woman who
has been able to do it all: a very successful career, now a CEO, a wife and a
mother. …A very important role model in a region where it is challenging to
find female CEO’s of global companies.”
Carmen Gonzalez-Sanfeliu, a Venezuelan who
serves as Vice President for Latin America and Caribbean for
Intelsat, the world’s largest provider of fixed satellite services,
agrees.
“Gustavo Cisneros has made a clear “statement” to not only continue to keep his
organization within his family, but he also bestowed one of his most important
business decisions in the hands of a young Hispanic woman, setting a tone for
all upcoming professional women who aspire to reach their highest level of
success,” she says. “This decision is coming from a very successful business
and entrepreneur who is known to take very well thought-out and calculated
risks. Gustavo Cisneros determined Adriana was the best leader.
What more significant message than this?”
However, even before her appointment as CEO, she was considered one of Latin
America’s top businesswomen.
“That Adriana Cisneros is a woman is obviously
significant, but not as surprising as it used to be,” Naim says. “While women
are still under-represented in the ranks of top management, it is also true
that in recent years, the number of female corporate leaders has increased.
Adriana will be part of a still small but growing group.”
Rangel believes Adriana’s gender is actually a plus.
“While corporate culture has imposed a thinking that leadership is gender
neutral, I think empirical evidence destroys such tenet,” she says. “Indeed it
will suffice to observe the salient features of Margaret Thatcher’s and
Angela Merkel’s land marking leadership styles and compare them to those of
William Clinton or Tony Blair to realize that gender does make a difference. As
the first woman to head the Cisneros Group, Adriana will certainly bring to the
table her negotiation skills; the strength of her character and the vision from
a demographics that is increasingly becoming a significant target for
entertainment services: women entrepreneurs.”
In the end, Herrera-Vaillant believes her talent rather than gender will be
key. “Although absolutely female and feminine, I sincerely doubt she will
measure her accomplishments in terms of gender, but rather as a very well
trained human being, executive and team leader,” he says.
SMOOTH TRANSITION
The
appointment of Adriana as CEO clearly represents a good example of a smooth
transition within a family business, thanks to the close relation with her
father.
“Their outstandingly close relationship is sure to
provide for a very smooth transition as a natural consequence of something for
which Adriana has been training for several years, following a long standing
family tradition,” Herrera-Vaillant says.
It comes
after years of preparation. “Adriana has not only been exposed to the nuts and
bolts of the entertainment services since her childhood but carefully groomed
for this job at least over the past seven years,” Rangel says.
Naim echoes that view. “For a long time
Gustavo Cisneros had made clear that Adriana was going to be the leader of the
Group,” he says. “He also announced that a transition --which included
Adriana's exposure to the different facets and business units of the company--
was under way. In this process she was working very closely with CEO Steve
Bandel. I know that this was a carefully planned succession and I also know
that Adriana has been working very hard in recent years.”
In an interview with Bloomberg in June 2011,
Adriana revealed that she had thought she would work at the company when she
was 40, not 25. “When I saw my brother
didn’t want to take the position that he was groomed for, out of sense of duty
I said let’s do it sooner than later,” she said.
Her brother Guillermo handles the Cisneros
family finances.
STRONG LEGACY
Despite Adriana’s passion and unique background, she has her work cut out for
her, starting with the comparison with her father. “She knows that she has big
shoes to fill,” Naim says.
Adriana Cisneros acknowledges as much. “My greatest challenge will be to
continue leading the company’s growth at the fast pace my father did,” she says. “His extraordinary ability to almost
immediately envision the potential of a business deal was the key to success
for this company.”
And it is no small legacy Gustavo leaves
behind as day-to-day manager of the Cisneros Group. “Gustavo Cisneros… led the Cisneros Group from
one of Venezuela’s great companies to one of the world’s great ones,” Dileep
Rao, a professor in management and international business at Florida
International University, wrote in a Forbes column this week.
Long before the phrase multilatina was coined or globalization was in fashion, Gustavo
Cisneros turned the Venezuelan company into a global powerhouse.
While Jorge
Lemann and his Brazilian 3G capital has raised eyebrows for its recent
purchases of three symbols of Americana
(Budweiser beer, Heinz ketchup and Burger King), the Cisneros group owned
Spalding, which invented the first basketball in 1895 and remained the world’s
top basketball maker for years, for more than a decade – from 1984 to 1996.
While Mexican mogul Carlos Slim has been in the news for his recent attempts at buying
a European telecom company (Dutch-based KPN), Cisneros bought Galerias
Preciados, one of Spain’s top retail chains, 30 years ago -- in 1983.
“At a time when most
Venezuelan --- and indeed Latin American -- business leaders were concentrating
in their home markets, Gustavo Cisneros pursued a bold international
expansion,” Naim says.
In the 1970s and 1980s multinationals were
almost exclusively a developed-country phenomenon; very few companies based in
poor countries operated abroad, he points out.
“The concept of emerging markets had not been coined and globalization was far
from being the common idea that it is today,” Naim says. “Protectionism and
barriers to international trade and investment were rampant. In this context
Gustavo Cisneros used his group's base in Venezuela to pursue business
opportunities abroad and infused his company with a strong international
orientation. In this sense he is undoubtedly a pioneer.”
Gustavo became CEO of the Cisneros company in 1968 at the
young age of 23. However, he was still older than his father Diego when he
founded the Cisneros group in 1931 at the age of 20. Diego had started out his
career by acquiring a trucking company two years earlier. During the subsequent
years, Diego expanded the company into auto repair parts, ice cream production,
soft drink bottling and TV broadcasting.
Gustavo is credited with taking the legacy of his father and expanding it
strongly both at home and abroad.
“Growth is undoubtedly an outstanding accomplishment of Gustavo's leadership of
the Cisneros Group since he took over from his father … at a very young age,
and multiplied their dimensions exponentially in a very short time, breaking
fully into the multinational arena, and joining the big leagues of global
business,” says Herrera-Vaillant, who ran the
Venezuelan-American Chamber of Commerce for 16 years during the 1990-2006
period.
“Vision, agility, flexibility and boldness also come to mind as he took his group
into ever expanding and evolving areas of business, always seeking and
identifying opportunities and synergies that could bring growth, strength and
experience to the organization. But I would also add focus, because it is my
belief that - even as he led the group into several fields and took on new
challenges in completely different areas - his underlying focus and core
interest seem consistently inspired in an unwavering faith in the unlimited
potential of combined media, information and technology, starting from a
platform of local television and escalating into all of the stunning range of
new options that are now available and that will continue to multiply in the
future.”
In 1984 Cisneros acquired Spalding & Evenflo
companies. Spalding was one of the top sports equipment producers in the world
(especially in basketball and golf), while Evenflo is a manufacturer of infant and toddler car seats, gates, and
bathing products.
The company was sold to KKR in 1996. In 1996, the Cisneros group created a joint venture with Hughes Electronics to bring
DirecTV to Latin America, and two years later a joint venture with AOL to bring
that brand to Latin America.
While Gustavo Cisneros often resold assets he had acquired – mostly at a hefty
profit – he did not purchase at a whim. Instead, he spent considerable time to
prepare for the purchases in cases like Univision, Rao points out.
“Gustavo has been a visionary leader transforming the Group into what it is
today,” Segal says.
Asked about what he himself considers his key
legacy, Gustavo Cisneros tells Latinvex: “Primarily, having
bolstered Cisneros’s international expansion, thanks to a strategy based on
diversification and synergy, was one of my greatest achievements. Even during
the seventies, I had a clear vision of where we were going, and we started
laying down the foundation that would allow us to take the decisive step of
becoming an authentic multinational company in the eighties.”
The period started with the acquisition of the American Bottling (ABB) in 1981,
the Cisneros Group’s first experience in LBO [leverage buy-out], a phenomenon
that would change the face of Wall Street forever, and the purchase of AAB
reflected that transformation, he points out. “One by one, Spalding, Evenflo,
Galerías Preciados were added to our portfolio. Of course, one of our most
successful operations was the purchase of Univision in 1992, which we later
sold in 2007.”
Over the years, the Cisneros group also has
attracted some of Venezuela’s top talent. In addition to Rangel (who had served
as chief of staff of President Carlos Andres Perez) they include people like Jose Antonio Rios, Chairman and CEO of
Celistics, and Eduardo
Hauser, who served as executive vice president for AOL Latin America for
six years before founding news generator DailyMe in 2005 and ran it until its
sale to ePals in 2011. Rios, a former high ranking executive with Telefonica
and Global Crossing, spent 13 years as corporate vice president at the Cisneros
Group before continuing to work indirectly with Cisneros as CEO of DirecTV
Latin America. Hauser worked as Managing Director of the Cisneros companies for
more than a decade after starting out as an intern while studying law in
Caracas.
Although Gustavo
Cisneros no longer will be involved in the details of the day to day
operations, he is expected to continue working closely with Adriana on
strategy. “He most certainly will
continue to provide vision and strategy inputs to the group’s development,” Rangel
says.
And, not to be underestimated: Providing a “Golden Rolodex” of key contacts
worldwide. During the past 45 years he has built an impressive roster of
friendships and relationships with a Who’s Who of political and business
leaders around the world, including the elder and junior Presidents Bush, Henry
Kissinger, Mexican mogul Carlos Slim, the late Italian mogul Gianni Agnelli and
the two wealthiest people in the United States, Bill Gates and Warren Buffett.
He has often used those
contacts to help promote ideas such as free trade and better education in Latin America.
“Gustavo’s legacy is also one of Hemispheric leadership,” Segal says. “He sees
and understands the opportunities and challenges that face the region not just
as a businessman but as a statesman. That makes him very unique.”
However, Gustavo Cisneros emphasizes that
Adriana will be running the company. “I am a firm believer of the right of the
younger generation to do things their own way,” he tells Latinvex. “As the second
generation, I worked with what my father left me and lead the company through a
period of successful international expansion. Now, it’s Adriana’s turn. She has
accepted the family legacy. She has embraced the principles and values we have
instilled in her wholeheartedly and instinctively. She has started her
executive career on the right foot and she has a very clear and innovative
vision as to where the company should continue to expand.”
FEARLESS AND PROFESSIONAL
Adriana
Cisneros will likely resemble her
father in key ingredients for a thriving leadership such as understanding of a multicultural world; size
and density of networks and talent to produce successful content, Rangel says.
Gustavo
adds another trait that both he and Adriana have. When explaining to Forbes columnist Rao why he chose
Adriana as his successor, he responded:
“Because I am fearless, and she is
the same.”
Gonzalez-Sanfeliu remembers meeting Adriana
Cisneros three years ago at an event in Miami. “You could
immediately tell that Adriana was indeed going to end up being the new head of
the Cisneros long run family empire by how comfortable and professional her
demeanor was,” she says. “She has a distinct presence about her.”
However,
Adriana Cisneros will also likely set her mark by focusing more on technology. “While her father Gustavo will
continue to provide his vision to the Cisneros Group Development; the
enterprise led by Adriana will most probably become a stronger player in cyber
space,” Rangel says.
In the interview with Latinvex, Adriana
Cisneros expressed her passion for technology. “In my new role as CEO I will continue working on the
plan developed as head of strategy spearheading our endeavors in the digital
world,” she says. “The most fascinating thing for me is how to conceive new
successful businesses that are at the forefront of technological developments
and still satisfy the present needs of the general public as this impacts their
means of communication. I am really passionate about anticipating how all the
pieces of the puzzle come together in order to identify and integrate new
acquisitions and platforms. That is why I established Cisneros Interactive, a
business division that integrates everything digital, which at the moment
includes ad networks, social gaming and e-commerce, and it will be the force
behind of our new strategic developments.”
This is the second time in its history that the Cisneros
Group selects the right leader to guide it through a corporate transition,
Rangel points out. “First was when Mr Diego Cisneros passed the mantle to
Gustavo his son,” she says. “Now Adriana will further its globalization.”
Segal concurs: “Gustavo has shown
great judgment and leadership in choosing Adriana.”
Adriana Cisneros herself is bullish on the outlook for the company she now
leads: “We have a great future ahead of us,” she says.
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