SAVCA speaks to the SA SME Fund’s (SA SMEF) CEO Quinton Dicks and Principal Thiru Pather on their mandate and role in private equity, including their plans for the next year or two.

 

Tell us a bit about the SA SME Fund?

SA SMEF: The SA SME Fund was launched by the CEO Initiative with the core objective of stimulating economic growth and employment opportunities in South Africa.

 

What is your mandate?

SA SMEF: Operating on a Fund-of-Funds model, the SA SME Fund will make commitments to late stage Venture Capital and SME funds through to small mid-market funds.

These funds should have high growth, profitability and sustainable employment growth as core elements of their investment thesis.

As the Fund is not a grant, pledge or social impact fund, commercial returns will be targeted.

 

What is your role within the private equity space?

SA SMEF: In addition to our investment objective, the fund will focus on the transformation of the private equity fund landscape and the development of black fund managers and high growth black SME businesses.

We will use our resources and the collective power of our shareholder body to make a marked difference in the SME ecosystem. We aim to do this via:

1) working with incubators, accelerators and similar organizations to help identify high potential entrepreneurs and match them with the skills and funding required to help them scale;

2) set up a national mentorship platform to create a network of tiered skills to match the different levels of needs;

3) exploring solutions to alleviate late payments to SME’s and the attendant cash flow constraints.

We would like to have a multiplier effect on the industry by convincing other investors to invest alongside us as well as by drawing greater debt funding to the sector.

 

What would you like to achieve in the next year or two?

SA SMEF: Our immediate focus is to accredit the first funds in our investment program. We will encourage the use of mentorship and technical support by our fund managers in order to ensure more successes in the SME space.

We would like to make meaningful progress in the SME ecosystem development space, specifically around mentorship.