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Government Funding

Government Funding & Grants Advice

Government grants and loan programmes have been set up by the government to extend funding to previously disadvantaged South African to foster black economic development.

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There is a good deal of Government sponsored non-repayable Grants and Assistance Programs for manufacturing and tourist related businesses as well as innovative R&D product development projects available in South Africa.

A grant is an award of financial assistance in the form of money. The government is one of the best sources for grants. Grants have strict guidelines for applying and using the funds.

Related: Matching Your Pitch to the Funder

Grant funding agencies use grants as a way to accomplish a specific goal that the organisation wants to achieve. If your start-up fits into the right criteria, you may be able to apply for funding through a grant.

The difference between a loan and a grant is that grants do not have to be repaid, but they do require a considerable amount of paperwork. The grantee is required to account for spending the money in the manner specified by the grantor.

Grants funds fit broadly into two different categories – money that is sponsored by the government and money that is sponsored by corporate financial organisations.

Most of these funds have their own specific requirements, and only those businesses that fill specified requirements, get to access to these funds. Funding agencies often look for worthwhile projects such as those that might create jobs in rural areas or those that provide training to specialised groups.

Related: DTI funding guide

Small businesses can contact banks and other financial institutions for small business bank loans. A business loan must be paid back and strict criteria must be met to qualify. There are a number of private funders that may be able to help.

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26 Comments

26 Comments

  1. oupa

    Jun 3, 2013 at 18:18

    where do i get that director

  2. ALEXANDER MOEMISE

    Nov 11, 2013 at 17:50

    I would like to know more about government grants

    • Timothy

      Aug 1, 2014 at 00:27

      me two and we can actually get access to these grants in a reasonable amount of time, as i have read that it generally takes too long to get access. this can actually effect the business as the opportunity may be taken by someone else why you are trying to secure funding

  3. thapelo setungwane

    Jan 15, 2014 at 12:57

    i just register my business so i need funds to start,how can i get help?

    • andile

      Aug 26, 2014 at 16:47

      I have just received accreditation for my training company. I am now struggling to make it known. Is there a way that the government assist in this regard?

      • Sello Kutumela

        Sep 7, 2014 at 07:18

        Advertising is the only way to get your name out there, start with social media as it is the cheaper way to grow your name

      • adam

        Dec 14, 2014 at 10:48

        contact Sean from inorbit he can help you with your business they do business marketing and promotions his your guy sean@inorbit.co.za

  4. Ashwell Daniels

    Jul 28, 2014 at 19:37

    I also started my business provide work for 3 persons. Although we have a lack of transport we do not have a shortage of work, we are same times not available to go because of the transport and we wish we can solve this problem.

    • Joe Ogbechie

      Sep 16, 2015 at 15:18

      What kind of business do you do?

      • Ashwell Daniels

        Mar 3, 2016 at 22:25

        We do electric & Cooling

  5. Maxene

    Oct 12, 2014 at 19:08

    What are the requirements to apply for a goverment grant

  6. adam

    Dec 14, 2014 at 10:53

    Guys I’ve noticed most of you have problem with funding or business exposure this goes back to your business plan if your business plan wasn’t properly compiled then you are surely going to have problems moving forward my suggestion is consult with a business development specialist that give you proper guidelines for your business bringing you a step closer to making your brand work contact sean@inorbit.co.za he handles such problems good luck

  7. blaze

    Jan 14, 2015 at 22:29

    im seeking business finance for start up please help. I have a business plan

  8. Machele John Mosikatsana

    Feb 10, 2015 at 14:15

    There are numerous overseas grant funds that assist in the social upliftment of people in developing countries Africa and South Africa. – See more at: http://www.empowermentprojects.blogspot.com/#sthash.vNw4HzqK.dpuf

  9. Terry

    Feb 16, 2015 at 11:46

    There is such a large amount of development shortage in SA, in various sectors of the skills avenue. In the arts sector alone small business’ that can provide a service cannot access grants from government or corporate. Its basically big business with all the relevant supporting documents that can access grant easily. Its sad that a small service provider needs 5000 supporting documents to access a small grant to provide a service that which is necessary in the community. Its sad that we’re not even given a chance.

  10. Neilyster

    Mar 25, 2015 at 20:51

    i register my business so i need funds to start,how can i get help

  11. Machele John Mosikatsana

    Mar 26, 2015 at 12:42

    The easiest way to find information on free business grants
    is to go to:, http://www.empowermentprojects.blogspot.com/
    where you can search and apply for a
    myriad of government grants available.

  12. Nomathembha Zwelibanzi

    Aug 3, 2015 at 15:31

    i just registered my transport business so i need funds to start,how and where can i get help?

  13. thabiso

    Aug 28, 2015 at 11:34

    I have register my business,so can u help with funding

  14. lorraine

    Oct 29, 2015 at 10:47

    hi, I have registered my company now I need about R10 million to start, so who can you refer me to for grand application and I also some invertors are welcome. I am willing to do the presentation for them.so can you please help?

  15. lorraine

    Oct 29, 2015 at 10:47

    hi, I have registered my company now I need about R10 million to start, so who can you refer me to for grand application and I also some invertors are welcome. I am willing to do the presentation for them.so can you please help?

  16. Mvuseni Mbatha

    Oct 30, 2015 at 15:54

    I have registered my company. And completed necessary research about a business I wanted to start. From 2012 up to now still need funding/capital. How can I get help?

  17. David Melk

    Mar 16, 2016 at 19:07

    I have a piece of land and I want to develop it into a holiday resort. How do I get funding?

  18. John Wilson

    Jul 29, 2016 at 17:15

    Debt Consolidation Loan up to R7,000.000.00,!! Apply Now We will be able to help you no matter what!Take control of your debts – do not let your debts control you!Consolidate your debt once and for all!Get rid of your DEBT load Get rid of the monthly DEBT pressure Get out of your DEBT trap We help those who cannot be helped elsewhere If you have shopped around and been declined then this is the right place to come to If you are under Debt Review you can apply. Are you having problems with garnishee orders?We help people throughout around the world .DOCUMENTS REQUIRED:- ID BOOK- LATEST 3 MONTHS BANK STATEMENT- LATEST TWO MONTHS PAYSLIPS- BLACKLISTED CLIENTS WELCOME.Contact us today via email at: boschloanservice@gmail.com

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    We do Wedding Finances as well..

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  19. John Wilson

    Jul 29, 2016 at 17:51

    Debt Consolidation Loan up to R7,000.000.00,!! Apply Now We will be able to help you no matter what!Take control of your debts – do not let your debts control you!Consolidate your debt once and for all!Get rid of your DEBT load Get rid of the monthly DEBT pressure Get out of your DEBT trap We help those who cannot be helped elsewhere If you have shopped around and been declined then this is the right place to come to If you are under Debt Review you can apply. Are you having problems with garnishee orders?We help people throughout around the world .DOCUMENTS REQUIRED:- ID BOOK- LATEST 3 MONTHS BANK STATEMENT- LATEST TWO MONTHS PAYSLIPS- BLACKLISTED CLIENTS WELCOME.Contact us today via email at: boschloanservice@gmail.com

    We do Business Finance (Business Loan) for up to R7,000.000.00

    We do home loans even if you are blacklisted

    We do personal loans for up to R280,000.00 even if you are blacklisted

    We do Car finance even if you are blacklisted

    We do 2nd Bonds, Home Improvement and consolidation loans up to R380,000

    We do Wedding Finances as well..

    We offer the above kinds of loans all at 5% interest which is one of the cheapest around the World.

    Requirements:

    3 Month bank statements to date latest salary must reflect.
    Clear copy of ID Book.
    Latest payslip if weekly or commission 4 latest pay slips
    NB: Work and cell numbers
    Contact us Today at: boschloanservice@gmail.com

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Entrepreneur Today

Growthpoint Properties And Department Of Small Business Development Partner On New Enterprise Incubation Programme

Small businesses to benefit from groundbreaking new partnership between The Department of Small Business Development and Property Point, a Growthpoint initiative.

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In a landmark partnership for collective economic growth in South Africa, the Department of Small Business Development (DSBD) is joining forces with Property Point, a Growthpoint Properties initiative, to develop more small businesses for South Africa’s property sector.

DSBD has allocated a R5 million grant to Property Point for a one-year small business development programme as part of its Enterprise Incubation Programme (EIP).

First initiative of it’s kind in property

This breakthrough initiative is the first public-private partnership of its kind in the property sector

It will develop 16 small businesses in the property sector of which two-thirds are youth- and woman-owned.

Shawn Theunissen, head of Property Point and head of Corporate Social Responsibility for Growthpoint Properties, says: “Property Point’s objective has always been to contribute to South Africa’s economic growth. Using a best practice model, we have delivered positive results in the property sector for the last decade.”

Partnering with government

“Now, our new partnership with government will escalate our impact on transforming the economy at a crucial time when South Africa is dealing with high employment and low economic growth,” continues Shawn.

President Cyril Rhamaphosa said in his recent State of the Nation speech: “Ultimately, the growth of our economy will be sustained by small businesses, as is the case in many countries. It is our shared responsibility to grow this vital sector of the economy.

We will work with our social partners to build a small business support ecosystem that assists, nourishes and promotes entrepreneurs.”

Property Point has been a driver of transformation and small business growth within the South African property industry in the 10 years since it was founded by Growthpoint in 2008.

Job and growth development opportunities

Already, it has created 2066 jobs and R842 million in procurement opportunities generated for the 130 SMEs that have participated in its two-year incubation programmes. These small businesses have reported 43% growth in revenue.

The partnership with government leverages Property Point’s deep-rooted success in growing competitive small businesses in the property sector over the last 10 years and expands it for bigger impacts on small enterprise development, job creation, economic growth and a more inclusive economy for South Africa.

Related: The Vision to Succeed

The country’s recent budget speech also stressed: “Government must create an enabling environment for small businesses to thrive, as they are an important lever to create jobs and grow the economy inclusively. Work is being done to provide crucial funding to innovative small businesses when they need it most.

Substantial funds available for SMME’s

A fund with an allocation of R2.1 billion over the medium term is being developed between the Departments of Small Businesses, Science and Technology and the National Treasury to benefit small and medium enterprises during the early start-up phase – this is an area that has historically had limited support because of the risks involved.

Another important constraint for small business is lack of market access and barriers to entry. To resolve this, our competition authorities continue to do the necessary and important work of addressing barriers to entry and rooting out anti-competitive behaviour which slows economic growth and dynamism.”

For this unique 16-business intake, Property Point’s programme is powerfully market driven. It will raise the profile of the entrepreneurs and strengthen their competitiveness, with a deep focus on market integration.

The programme aims to create market linkages for these small businesses that will see them included in procurement opportunities in the broader property sector, as well as Growthpoint. It is expected to set new benchmarks for small business integration into private sector supply chains.

Estienne de Klerk, CEO of Growthpoint South Africa, says: “We believe in the principles of social and economic transformation and empowerment on all levels, and we are committed to achieving this.

As a hands-on property owner – we own and manage our buildings – we recognise our unique position to develop small businesses to increase their access to market opportunities. We are proud to contribute to this pioneering public-private partnership designed to deliver on South Africa’s transformation, small business, economic growth and job creation objectives.”

Collaboration throughout sectors to increase sustainability

Property Point also collaborates with like-minded businesses and organisations across the sector to achieve the shared goals of building sustainable, competitive, small businesses and a vibrant culture of entrepreneurship and enterprise growth.

Related: Entrepreneurial Lessons From the Founder of Black Like Me

It enjoys a well-established and growing partnership with JSE-listed Attacq Limited. Since 2014, Property Point has tailor-made supplier and enterprise development programmes for Attacq to empower entrepreneurs and link small businesses into Attacq’s supply chain.

Theunissen concludes: “Together, Property Point and its partners in both the public and private sector will continue to make a positive contribution to South Africa’s property sector and play a vital role in stimulating and transforming the economy as a whole.”

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Government Funding

New Fund For Small Businesses To Be Developed

Government has allocated R2.1-billion toward the development of small- and medium-sized businesses.

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Driven by the Departments of Small Business, Science and Technology and the National Treasury, it was announced during the 2018 budget speech that entrepreneurs could unlocking funding for their businesses through a new funding initiative.

What is the new Fund?

Minister of Small Business Development, Lindiwe Zulu, explains where the fund stands and how it will work:

“The Fund will be operational during 2018/19 financial year but the planned disbursement of the funding will be the beginning of 2019/2020 financial year.”

She says R1 billion has already been transferred to the Department of Small Business Development from the national fiscus.

“The Department of Small Business Development together with National Treasury and Department of Science and Technology are working with the Government Technical Advisory Centre (GTAC) to develop the architecture of the Fund where issues around the management of the Fund will be considered,” she explains.

Related: Government Funding and Grants for Small Businesses

Who will the Fund be for?

“The Fund is targeting high growth businesses as our research on the ecosystem shows that there is a lack of funding of enterprises that are at an ideation and early start-up phase,” Zulu explains.

Her department together with the other participating arms of government, will identify areas of collaboration across research, mentorship and training of enterprises on financial management.

“The work that is being undertaken now will assist government to decide on how the fund will operate, but the government is conscious of the economic environment and would not look at setting up a completely new structure that will add to operational costs,” she says.

Addressing parliament on the fund, the minister said the financial mandate of the fund will be informed by the exercise that is being conducted through GTAC.

“Government is looking at having this fund as a soft loan which will provide affordable finance to small businesses and the emphasis will be more on ensuring that the Fund is sustainable rather than profit maximisation,” she explains.

Related: 11 Uniquely South African Business Ideas

How to apply for funding

Contact the following departments if you would like to access a portion of R2.1 billion:

Department of Small Business Development

  • Address: 77 Meintjies Street, Sunnyside, Pretoria
  • Tel: (+27) 861 843 384
  • Email: sbdinfo@dsbd.gov.za for information on the department and its services.

Department of Science & Technology

  • Address: DST Building (Building no. 53) (CSIR South Gate Entrance) Meiring Naude Road, Brummeria
  • Tel: (+27) 12 843 6300
  • EmailIsaac.Ramovha@dst.gov.za or zama.mthethwa@dst.gov.za for information and brochures about the department’s scope and funding.

National Treasury (GTAC unit)

  • Address: 40 Church Square, Pretoria
  • Tel: (+27) 012 315 5944 or (+27) 012 315 5645
  • Email: info@gtac.gov.za for information from the Government Technical Advisory Centre who will manage the small business fund for National Treasury.

Download a free Business Plan template here to get started.

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Government Funding

Expansion Funding Options For Your Growing Business

Growth can put an enormous strain on the cash flow of your business. Luckily, there are financing options available to you if you know where to look, enabling you to keep that growth on track.

Darlene Menzies

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One of the first things you notice when your business starts to grow is that your costs shoot up, while your profit doesn’t immediately follow. Growth can put an enormous strain on the cash flow of a company and business owners often make the mistake of financing growth from their cash flow — which is like using your credit card to finance your home renovations.

Doing things this way results in unnecessarily high financing rates and challenging repayment terms, which can also leave you vulnerable to a sudden cash flow crisis without the time required to line up financing.

Financing business expansion requires planning, especially for fast growing companies.

When planning for fund raising, consider applying for sufficient funds to cover the cost of existing debt and the cost of the expansion. When it comes to business expansion funding, the total amount of the finance required will determine which finance options are most suitable.

If your finance requirements are relatively low and your cash flow history is good, consider a term loan or business overdraft to fund your growth while you work on increasing your sales to meet your growth expenses. If your expansion needs include additional equipment or machinery, asset finance is available.

Related: 3 Ways For Social Entrepreneurs To Access Fundraising

However, if your SME is growing rapidly and you want to enter new markets, scale your team or undertake new product development, look at longer term funding solutions. Equity finance is the most common option for this kind of funding requirement and there are also government funds that cater for business expansion.

Government Funding Options

Government lending agencies provide a range of finance options for SMEs to foster growth in high priority sectors, specific geographic areas and to promote economic inclusion for previously disadvantaged people. The finance options include incentivised financing, cost sharing options, equity, loans and grants.

Government has partnered with Finfind, which has an up-to-date database of all the government funding offerings available to SMEs.

If your business profile or funding need matches any of the government funds, Finfind will match you with the offering and provide you with the details of what is required to apply.

Equity Finance

Equity finance refers to the sale of a percentage of ownership in your company in return for business expansion funds. One of the biggest benefits is that these lenders are often prepared to fund businesses that are not currently profitable, but have the potential to generate large returns. As equity funders take more risk than traditional financiers, they expect a higher rate of return on their investment from businesses that can scale into large markets and show highly profitable future returns.

In the SME market, early-stage equity finance is usually provided by venture capital companies (VC), while mid-stage or larger expansion funding requirements for medium size enterprises are provided by private equity funds or bank loans. VCs look for businesses with a strong founder, that have proven product market fit, a team to execute the business plan and a robust business model showing strong future returns. Funding amounts usually vary from R1 million to R20 million.

Related: What Type Of Growth Funding Do You Really Need?

What Funders Want

business-funding

Funding applications require preparation, including a detailed business model that outlines expansion plans and makes a compelling case for investment.

CVs of key staff will be important as well as an organogram that shows the impact of the expansion on your team, detailed projected income and expenses, historical, audited financial statements, bank statements for the business’s bank account/s, tax clearance certificate, and personal statements of assets and liabilities for all owners as well as company and tax registration documentation. Keep an electronic folder with this documentation and update it monthly so that you can access it whenever it is needed.

If the initial funding meetings go well, the potential funder will perform a due diligence where the financials, the business model and its assumptions and projections will be scrutinised. They may interview some customers and your key staff members. Funders are especially interested in the founder and team running the business, as they are responsible for ensuring that the projected growth is realised. They look for experience, deep knowledge of the industry and operational competence.

Resource

Finfind is SA’s leading access to finance solutions for SMEs. This revolutionary online platform links finance seekers with matching lenders, providing easy access to over 200 lenders and over 350 loan options. Finfind is supported by USAID and sponsored by the Department of Small Business Development.

Go to www.finfindeasy.co.za to find the business finance you need. It’s free and easy to use.

Related: The Ups And Downs Of Borrowing From The Bank


Get Funded

  • Do your homework: Each equity fund has a clear investment strategy. Familiarise yourself before engaging.
  • Educate yourself: Get to know the equity finance terminology and what to expect during the various stages of the deal process.
  • Develop an exit strategy: This is a common question and an important issue for funders.
  • Consider alternative funding: Can your expansion be funded with alternative or cheaper sources of finance that do not require giving up shares? Keep in mind, though, that the right investors bring more than money. They provide expertise and access to networks that can expedite your expansion plans.

Lastly, while you don’t always get the luxury of choice, do your best to partner with people you will enjoy working with, it can be a long marriage.

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