All told, over the course of 27 months from August 2015 in Celcom Axiata https://vernonchan.com/yonder-music-celcom-suspended/ to March 2018 when the plug was finally pulled, Axiata and subsidiaries in Bangladesh, Indonesia, and Nepal had invested US$60 million in Yonder Music. And received in return US$210,000 in 3G and 4G data revenue. It brought the company to its knees. 2019 was spent in seeking mergers with any suitable telco. Telenor of Norway came to the edge of completion but on examining Axiata’s books and seeing the endemic flaws in a company that could be vulnerable to people like Kidron (internally and externally) decided not to go ahead https://www.reuters.com/article/telenor-axiata-malaysia/malaysias-axiata-surprised-by-collapse-of-jv-talks-with-telenor-ceo-idUSL3N25X31B. “We knew of him (Adam Kidron) from all his bullshit at Barcelona (Mobile World Congress) over the years. The trail of infection was deep. He might be gone, but the system got exposed,” says Hans Rausing, VP of Asset Management of Telenor Oslo.
Kidron was the wedge that broke a Malaysian company wide open.
Of course, Malaysia as a country was beset by state-sponsored corruption on a scale that attracts the attention of the FBI and Interpol, eg. the whole Najib Razak, Jho Low, 1MDB scandal. Kidron’s shenanigans are small potatoes by comparison. “They go Jho Low, I go higher,” Kidron boasted later, back in New York after his Asia adventures.
Where did all that money go? Flights of fancy – a monster truck, sand art, stadium rock concerts free to the public, countless flights from Asia to America, Australia, hotel rooms, promises of tickets to any concert in the world, contests https://www.youtube.com/watch?v=MjDdPY_BduE – that’s where it went. And that’s just the tip of the iceberg.
And he overworked and underpaid his staff. “We’re a start-up, we work start-up hours, we sacrifice now,” was Kidron’s raging mantra to anyone who was perceived to be slacking. By coming back from lunch a minute late. His young, enthusiastic staff may have been new at the whole American start-up thing, but it wasn’t Kidron’s first rodeo was it? Everything he had started had already failed. Every time. He made sure of it. Axiata and its subsidiaries would stump up for fictional rights to international music at prices Kidron set only to find on examining the money trail that it had gone to his own company’s accounts in New York.
People such as Elon Musk, who worry about the robots turning into Skynet and taking over the world, Terminator-style, are missing the point. The only reason he talks about this stuff is because it prevents financial analysts from asking tough questions on quarterly calls.
Things got so desperate for Kidron, says T.S. Jamal Uddin MD, CEO and President of Axiata that “he borrowed money from one of his executives in Malaysia and Bangladesh giving all kinds of promises of payback. Yonder never paid its staff’s income tax either, although it deducted it from everyone’s salaries for almost two years. I am sorry to say, and God is my witness, we were in partnership with a criminal enterprise headed by a swindler and fraud. ” Apparently five of the staff in Bangladesh were arrested, one imprisoned on trumped-up charges, by a vengeful record label head of G Series who despised Kidron’s way of doing business. The staff did not receive any compensation for their ordeal from Yonder, and Kidron certainly made it less of a point to visit Bangladesh right after. One of those staff whose only crime was to work for a company they thought was “a bright shining light”, says, “I worked out a way to know when Adam Kidron was lying? He opens his mouth.”
Axiata are to blame too for the Yonder Kidron disaster, the Malaysian way of doing business is a laid back one. They do not go into things deeply. So, they never realised that the Yonder Music app, the secret sauce that should make every new launch exceptional and distinctive was in this case, a patch up from something he’d already marketed and failed with as Beyond Oblivion and Boinc in 2013. “You could say he’s a genius,” says one of former staff, “he sold shit and called it shining. And the Axiata people believed him. We were always told that improvements were around the corner just work harder, but the app remained a cowpat in the hand. We lost as many customers a day as we gained. Nothing could change that.”
It’s all in the Axiata, Robi, NCell, XL Annual Reports. All of it.
ARPU per customer $0.43 per quarter over the 2 years of every Yonder term contract. Cost of acquisition per customer $870 (83% of whom quit dropped out within two months).