Southern African Venture Capital and Private Equity Association

Accurately positioning venture capital and private equity as forces for good in the South and Southern African economies is an important goal for SAVCA and its members. This SAVCA 2017 Venture Capital Success Stories - SAVCA’s first Case Study Compendium dedicated to the VC space - is an important step in achieving this ambition.Earlier this year, SAVCA released the SAVCA 2017 Venture Capital Survey, which presented impressive data indicatinga substantial strengthening in the position and impact of investors in VC deals. This Compendium complements those quantitative findings by providing vibrant, compelling case studies explaining how VC actively supports South Africanbusiness.  

The standout features in the latest survey include a rise in corporate co-investment alongside early-stage fund managers, resulting in a total capital flow to startups of more than R3bn, for the first time since the first survey was conducted in 2010! In 2023, the South African VC asset class had R10.73 billion invested in 1,106 active deals, an increase of 17.8% or R1.62 billion compared to the previous year. 2023 defied the downward trend in annual deals seen since 2020, with investments totalling R3.28 billion reported for the year. The increased participation by corporations and investors (particularly DFIs and Fund of Funds) is very encouraging.

The 2024 report showcases business activity and trends for the 2023 calendar year, with globaltrends incorporated where relevant, and illustration of the region’s performance from year to year. Senior management in PE firms are concerned with the macro environment and outlook, fundraisingchallenges, and valuation mismatches. This notwithstanding, business sentiment remains positive and with good reason too. Fundraising saw an impressive 43% jump in 2023 (highest in 13 years, from R19.6bn to R28.1bn), whilst exits proceeds increased to R21.3bn from R20.8bn – the highest level of proceeds since 2011.

The Covid-19 epidemic is an unprecedented public health and economic crisis. President CyrilRamaphosa and his ministers have taken decisive leadership in confronting the pandemic. Global evidence is clear that early interventions to limit contact and trace infection pathways help to slow infection rates. Support from opposition parties, civil society and business is helping to achieve this. The pressure will continue to be immense as we all work to limit the spread and impact of the pandemic, but we have high confidence in national leadership to lead us in doing so. The private equity and venture capital industry manages R175-billion of investments in privatecompanies, mostly small- and medium-sized businesses, on behalf of pension funds and otherinvestors. We are at the front line of working with particularly small- and -medium sized companies to confront the crisis. 

Session 1: PE Re:imagined, the lasting impact of COVID – case studies: In the first session of the day, which was moderated by Tanya van Lill, CEO of SAVCA, we looked atan array of diverse Private Equity (PE) case studies that illustrated some of the ways in which theindustry is operating and had to adapt. Session 2: Industry trends and SA Inc Panel: Thereafter, the second platform session of the day kicked off with Cathy Goddard, CEO of FyreFem Fund Managers interviewing David Wilton, CEO of Zhang Partners.David highlighted that SA used to be highly visible in the PE market as a crucial part of the BRICs five and a desirable destination to do PE in emerging markets. These days it’s no longer viewed as a standalone destination, it’s now seen as one part of the whole African continent.

The 2021 SAVCA Venture Capital (VC) Conference kicked off on 15 November 2021. A hybrid event, the physical component took place at Eureka Wine Estate, Durbanville while also being streamed to a virtual audience attending from across the country. In a continuation from the March conference, the overarching theme was “re:imagine” as we work towards re:imagining the part VC can play in rebuilding our economy. Sisters Matsi Modise and Mosidi Modise, who praised the enabling role SAVCA plays in the VC industry, provided a warm welcome to the event and introduced the first session. This was an interview between Ketso Gordhan, SA SME Fund CEO and Mmboneni Muofhe, Deputy Director-General: Technology Innovation (Department of Science and Innovation) on the role of government in enabling an innovative and vibrant VC ecosystem.

Private equity has long been used as a developmental tool. From Asia to Latin America, across Africa and here in South Africa, deploying investments in targeted ways through private equity funds has been highly successful in driving developmental outcomes. Previous studies to measure this impact in South Africa have demonstrated that private capital does better than other forms ofinvestment in driving growth, creating jobs and improving transformation.

This report was produced from a research project conducted by Intellidex and funded by the Southern African Venture Capital and Private Equity Association (SAVCA) and 27four Investment Managers with support from Edge Growth. It was independently researched and produced by Intellidex. 

It has been so heartwarming to see our members taking part in the PE and VC Surveys, both of which saw a record number of participants in 2023. We encourage members to continue with this commitment into 2024, as the industry trends and performance published in the Southern Africa PE Performance Report are crucial sources of data for benchmarking decision-making by multiple stakeholders The SAVCA Industry Awards, which were held over till 2024, as we moved the PE Conference to an earlier date, will be held on 9th May 2024. These awards serve as a reminder to all of us of why we do the work that we do, which is to ensure that high potential businesses of all sizes benefit from access to risk capital and the many benefits that a SYNERGISTIC relationship with their fund managers provide. 

We are proud to present the second edition of the SAVCA Case Study Compendium to our stakeholders. This publication celebrates the impact of private equity by featuring the stories intertwined in the partnerships between private equity fund managers and the businesses in which they invest. The sixteen case studies represented in the 2017 issue all underscore the long-term nature of these collaborative partnerships, and reflect the common goal evident in each instance – that of rendering the portfolio company more resilient, more efficient, with health