JOHANNESBURG – South Africa-born SME financier GroFin presented its uncapped and unlimited-life Small and Growing Businesses (SGB) Fund in South Africa this Monday.
The Fund’s launch took place at an exclusive session hosted jointly with the Netherlands Embassy during the House of the Future event being held in Johannesburg till November 20, 2015.
The GroFin SGB Fund seeks to address the different market barriers faced by African entrepreneurs with an integrated solution of patient growth finance, tailored business support, and access to markets. Based on the viability of an entrepreneur’s business and growth plans, business owners will be able to access loans ranging from USD 100,000 to USD 1.5 million for a period between two and six years. The repayments are aligned to cash flows and relevant moratoria on capital and interest payments are provided where necessary.
Speaking at the South African launch of the fund, Guido Boysen, Chief Investment Officer at GroFin, said that the Fund’s focus is on growing, owner-operated businesses led by experienced entrepreneurs.
“GroFin has worked with 8 000 entrepreneurs across Africa and the Middle East, providing value-added business support to help small businesses succeed,” he said.
Trevor Conradie, GroFin’s investment director for South Africa, noted that, apart from growing and mature businesses, GroFin also funds start-ups, and has 20% of its investments portfolio dedicated to such enterprises.
Job creation being a key priority of the Fund, Conradie highlighted that GroFin is keen on businesses that have the potential to create 10 – 50+ job opportunities, starting with companies that have fewer than 150 employees. Currently, research by economists.co.za shows that 65% of SMEs in South Africa create zero job opportunities, while just 9% create 20 jobs or more.
Trevor concluded on the note that the SGB fund South Africa considered applications totaling USD 6 mn (R86.2 million) for the year to October 31. It approved applications to the tune of USD 2.3 mn (R33 million) with an average deal size of USD 376,000 (R5.3 million).
With initial commitments of USD 100 million, the GroFin SGB Fund is expected to grow to USD 150 million in two years, making it one of the largest funds specifically targeting SMEs in Africa.
Currently, the Fund covers the nine African economies of South Africa, Kenya, Rwanda, Tanzania, Uganda, Zambia, Ghana, Nigeria and Egypt. Over the next two years, GroFin plans to expand the Fund’s support to SGBs in three more African countries.
The Netherlands attaches much value to stimulating the growth of Small and Medium-sized Enterprises around the world and is working together with GroFin to realise this objective in South Africa via the Dutch Good Growth Fund (DGGF).
Besides GroFin and the DGGF, the other investors in the Fund are as follows:
• Shell Foundation, an independent charity, with an 11 year track record of providing vital support to under-served SGBs in Africa and the Middle East
• The Norwegian Investment Fund for Developing Countries, Norfund; and
• The German development bank KfW, a seasoned founder of structured funds
GroFin is an SME development financier with over US$500 million in committed capital specialising in the small and growing business sector across Africa and the Middle East. For the last 15 years, GroFin has been providing a proven blend of need-based finance and value-adding business support to unserved and underserved entrepreneurs.
An award-winning, international and multicultural company headquartered in Mauritius, GroFin has over 130 employees who specialise in providing value to SGBs in its areas of operation covering Rwanda, Uganda, Tanzania, Kenya, Zambia, South Africa, Nigeria, Ghana, Egypt, Oman, Jordan and Iraq.
Its performance is recognised by industry experts, and has seen GroFin win the 2007 Africa Investor Award, the 2008 Africa Investor Award for Best Initiative in Support of SME Development, the 2010 World Business and Development Award, the 2013 Ghana Finance Award as well as the 2015 Ghana-Africa Business Award for outstanding contribution to Ghana’s development in the context of NEPAD.
For more information, visit: www.grofin.com
ABOUT The DGGF:
The Dutch Good Growth Fund (DGGF) was established in July 2014 by the Dutch Ministry of Foreign Affairs. The Fund provides finance and insurance to create the conditions for development related trade and investment in 68 countries. By linking aid to trade, the DGGF improves access to finance for entrepreneurs in both the Netherlands and developing countries.
One specific part of the Fund focuses on the support of the missing middle in low and middle income countries. In order to achieve this, the DGGF provides debt, equity, mezzanine financing or guarantees to development-relevant funds that invest in local SMEs.
For more information, visit: http://english.dggf.nl/
ABOUT House of the Future:
House of the Future is an event that is aimed at facilitating and showcasing Dutch-South Africa partnerships as part of the biggest trade mission to South Africa in Holland’s history.
It will take place from 16-20 November in Turbine Hall, Johannesburg, where key thought leaders and industry stakeholders will come together to generate solutions for shared challenges in the health, logistics, energy, agri-food and water sectors.
More information on the programme is available on Houseofthefuture.co.za.
Questions relating to GroFin:
Chief Marketing Officer, GroFin Managers.
firstname.lastname@example.org | +230 452 9156
Questions relating to House of the Future (Johannesburg):
Senior Communication Officer of the Embassy of the Kingdom of the
Netherlands in Pretoria,
Vera.email@example.com | 072 595 00 92