From zero to R350 billion in twenty years

Sygnia has grown its assets under management to R350 billion in just under 20 years of operation, and its thematic investing products and exchange-traded funds (ETFs) are proving popular with South African investors.

The company has gone from being a tiny institutional asset manager with R2 billion under management on behalf of a few retirement funds to the second-largest multi-manager in the country.  

It is also one of the largest passive managers in South Africa and the largest provider of international ETFs in the country. 

Sygnia’s history and growth cannot be separated from the life of its founder, Magda Wierzycka, who has led the company as its CEO for most of its existence. 

Wierzycka was born in Poland in 1969 and grew up in a two-bedroom flat with her sister, brother, grandmother and parents, both of whom were medical doctors. 

The family moved to Austria in 1982 due to Poland’s gradual economic collapse and the impact of political sanctions on the country. 

A year later, they were on their way to South Africa with only $500 in their bank account. Wierzycka was sixteen at the time and attended Pretoria High School for Girls. 

The young Wierzycka then attended the University of Cape Town and earned a Bachelor of Business Science and a Postgraduate Diploma in Actuarial Science in 1993. 

To help the family fund her education, Wierzycka earned a bursary for her university studies and worked at a supermarket selling cheese and cold meats during high school. 

Wierzycka worked straight out of university at Southern Life to repay her bursary. She moved to Alexander Forbes, where she built an asset consulting division for its retirement fund clients. 

This gave Wierzycka vital experience and showed her that being an actuary was not right for her. Investing and asset management proved more enjoyable. 

In 1997, she took the risk of joining Coronation, a relatively small asset manager at the time. Wierzycka was only the 14th employee. 

Wierzycka has described her role at Coronation in her book, Magda: My Journey, as being instrumental in growing it from a startup to a large asset manager as the head of its institutional business. 

After six years at Coronation, which is now an asset management giant, Wierzycka became CEO of the African Harvest Group. 

As CEO, she negotiated the sale of African Harvest Fund Managers to Cadiz Financial Services and led the management buyout of the rest of the business. 

The remainder of the business became Sygnia Asset Management, which Wierzycka founded in 2006 with R2 billion in assets under management. 

From challenger to champion

Sygnia quickly became known for its innovation in asset management, launching its customised investment strategies and its Signature range of multi-manager funds. 

These funds were among the first to blend actively managed strategies, outsourced initially to third-party fund managers, with Sygnia’s own passive investing strategies. 

While these strategies were launched in their first year, the company would wait until 2012 to expand into the retail market through multi-manager unit trusts. 

Sygnia became the first company in South Africa to offer passive management multi-asset funds to investors with its Skeleton fund range. 

While the company built out its investment platform to offer retail investors a full suite of products, Wierzycka was busy investigating an investing style that had become extremely popular in the United States – index tracking. 

In Sygnia’s latest integrated report, Wierzycka said the performance of these funds shows clearly that, after all fees and costs, index-tracking funds win the game.

Crucially, Sygnia has made these types of funds highly accessible by listing them on the JSE as ETFs, offering them as unit trusts, and by developing Sygnia Securities. 

The company has not been averse to growing through acquisitions, snapping up the Gallet Employee Benefits Group to fast-track its entry into the umbrella retirement funds market. 

Now known for its innovation, Sygnia launched the first comprehensive internet-based financial planning tool in South Africa, known as its RoboAdvisor. 

The asset manager also greatly boosted its index-tracking offering by buying db X-trackers from Deutsche Bank and renaming its Sygnia Itrix. After this acquisition, it became the largest provider of international ETFS in South Africa. 

Despite the rapid growth of its ETF business, Sygnia’s bread and butter remains more traditional employee benefit funds and has leveraged its strong relationship with employee benefit consulting firms to grow this part of its business. 

The company’s tremendous growth in assets under management has translated into a strong financial performance since listing on the JSE in 2015. 

Since listing, Sygnia’s profit after tax has grown from R59.3 million a decade ago to R350.1 million in 2024 – a compound annual growth rate of 19.4%. 

It is poised to cross R400 billion in total assets under management and administration in the coming years, with its ETF business growing to over R80 billion. 

The company is also well-positioned to benefit from the consolidation trend among South African asset managers, with its Sygnia Umbrella  Retirement Fund (“SURF”) having seen significant growth in both its assets and the number of participating employers. 

At R17.4 billion (2023: R13.6bn), SURF is the sixth-largest umbrella fund in South Africa. Competing against insurance giants in that space, SURF continues to win new business. 

This may also see a shift in strategy from Sygnia, with it looking to snap up smaller asset managers to further consolidate and scale. 

“We are moving past the era of organic growth to one in which we are open to making strategic acquisitions should suitable opportunities present themselves,” Wierzycka said. 

The graph below shows the strong growth in Sygnia’s assets under management and profit after tax since listing on the JSE.