Hlayisani Capital, a private equity investment firm, focuses on the SME ecosystem, tackling the current funding divide between early-stage venture capital and more conventional South African private equity.
Its first fund provides strategic support and capital to high-growth, highly scalable SMEs with an established track record and specializes in increasing SMEs into big, profitable, multi-territorial companies, creating employment and domestically generating export revenue.
Standard Bank and wealthy South African family funds were responsible for the first closure of ZAR 350 million (US$ 23.8 million). Investors were drawn to the established return on investment track record of the Hlayisani team, with more than 45 percent IRR being returned by the previous venture capital fund. The portfolio’s observable social impact has also played a part, as the sector provides a major opportunity for investment.
Last year, the Hlayisani Growth Fund announced its first seven investments. They are Snapplify, GoMetro, Wyzetalk, LEAP, Opennetworks, Sudonum and Ikeja, which secured a combined investment of ZAR200 million (US$13.6 million).
Investments are selected for their sustainable growth and high rate of return potential, as well as for their strong emphasis on having a positive socio-economic impact. These startups are expanding internationally and working on six continents, and have more than doubled their employee numbers since July 2019.
Dr Reuel Khoza, Chairman of Hlayisani Capital, said investors need to fund and invest in entrepreneurs as well as small and medium enterprises in order to unlock much-needed economic growth in South Africa.
“With the successful first close of the Hlayisani Growth Fund, we are privileged to increase our capacity to do this,” said he.
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