We know his scathing columns and his vitriolic analysis of the news and customs of the diamond industry. Charles Wyndham, founder of PolishedPrices, is among those who “knock over the ant-hill”, far from the legendary British stiff upper lip. He granted an interview to www.rubel-menasche.com, and answered questions without beating around the bush…
Could you introduce yourself and go back over your career path, in particular your 30 years in the diamond industry and what brought you to De Beers?
I am English. I read law at Oxford, having done 6 months at Poitiers University supposedly doing some economics. After Oxford, I spent two and a half years doing accountancy, got bored out of my mind and purely fortuitously was offered a job at De Beers in 1975.
I joined De Beers to do overseas administration in particular in what was then Zaire now DRC but instead became a diamond buyer and was manager of the Tshikapa buying office in Zaire which at the time was the largest buying office. After a couple of years, I got bored with that and switched back to administration in London.
1980: I went into the sales department, covered Belgium, America and what came to be called Special businesses, ie selling things outside the normal constraints as 1980 to 1985 was an exceptional bear market.
1986: I put in a completely new computerised stock control system and got involved in more general administration including diamond insurance for the whole group and became the CSO director for security. CSO was what is now called the DTC or in practical terms the London operation and all those offices controlled by London.
1993: I went to Johannesburg as the Diamond Consultant to the Chairman’s office whilst retaining the security portfolio in London. In South Africa, I was responsible for all Southern African sorting offices, Kimberley, Gaborone, Windhoek and all sales out of Johannesburg.
1995: I came back to London and decided to leave De Beers and do my own thing.
How and why did you come to launch WWW International Diamond Consultants Ltd and PolishedPrices?
WWW was formed in 1996 with Richard Wake-Walker also ex De Beers. In 1995 I also set up a broking business to De Beers with Gerald Rothschild. I sold my 50% stake in the business back to him in 2000. PolishedPrices is owned by U2 Diamonds Ltd which was formed in 2000 and went live in 2002. Emma Muller, Richard Platt and myself are the largest shareholders in U2 Diamonds.
Could you tell us more about WWW International Diamond Consultants Ltd and PolishedPrices? Their purpose? Their teams, your partnerships with Reuters and Bloomberg, etc.
Inter alia WWW has been the Canadian Government Valuators since 1998 and also the valuators for Ontario, so that all Canadian diamonds are valued by WWW for royalty purposed through the Canadian company DICAN which is majority owned company by the three Inuit groups in the North West Territories. There is a full list of companies for whom WWW has and is doing work on its web site. WWW is based on providing independent valuations and general advice.
PolishedPrices is a separate company formed to provide fully independent pricing source for polished diamonds with a view that one day it could be used as the basis for the creation of a diamond fund or some form of derivative / financial instrument. Prices are based on actual transactions and are multiple sourced. Companies that provide PP with data are given equity in the project. Specifically PP does not smooth prices, PP is there to reflect the market not try and make the market.
Reuters were the first to publish PP index after doing extensive research into our methodology, Bloomberg approached us fairly shortly afterwards to also publish the index and the full price matrix which can been seen on a Bloomberg screen.
In both WWW and PP no one trades in rough or polished stones. WWW has acted as the selling agent by organizing tenders but will not trade on its own behalf. WWW held the tenders for the Letseng mine for 7 years including the sale of the Lesotho Promise for $12.4 million in 2006.
Who are the readers/clients of PolishedPrices? How can you guarantee your independence and this open approach that sets apart your writing and reviews?
PP has a wide readership within the diamond industry and also those financial institutions which are involved in diamonds.
It is not possible to ‘guarantee‘ independence. It is now 17 years since leaving De Beers and the success of WWW and PP is based on our complete independence, so I suppose the best guarantee is the fact that if we were found not to be independent we would not have a business. In particular with PP for companies to give us their actual transactional data, especially as several of the companies are direct competitors with each other, shows a great deal of trust on their part and confirmation of our independence.
What do you like most about this particular area of the diamond industry?
The diamond industry is agreeably a bit of a lunatic asylum but I am not sure whether I am on the inside looking out or the outside looking in.
In your opinion, what are the current issues, as well as the future ones (let’s say over the next 20 years) for the diamond industry?
Fundamentally the industry has got to move away from its old decrepit business model and in particular embrace genuine transparency and the fact that it is a commodity with which they are dealing so that all the opportunities open to other commodities become available to them. The industry must have more confidence in its own product and not continue its Luddite approach to change. The emphasis should be on growing the cake rather than protecting what bit of the current cake anyone might have at the moment.
Does PolishedPrices have any specific new projects or development objectives that you would like to talk about?
As said earlier PP was and is interested in trying to create the platform for a third party to create some genuine financial products for diamonds. We are not experts on the products nor indeed on polished diamonds per se, but we believe / hope that transparency would be good for the industry and PP in particular. Some progress has been made but it is painfully slow.
And what about yourself?
Go to : www.polishedprices.com