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Attention Black Entrepreneurs: Start-Up Funding From Government Grants & Funds

Government grants and funding are a great source of finances when you’re trying to get your business off the ground or expand to new horizons.

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Government Grants and Funding in South Africa

A small business can on average employ 12 people. The drop in entrepreneurial activity over the past five years is equal to 2.3 million possible job opportunities lost. Small and micro business sectors are the main source of real employment in the economy.

South Africa’s economy needs to inspire entrepreneurship in order for it to grow. By creating an environment that is friendlier to small businesses and actively encouraging the sector, the country is in a better position to create jobs.

Two simple measures that would go a long way to support and develop entrepreneurs is access to finance and improvement of logistics.

Content in this guide

  1. National Empowerment Fund (NEF)
  2. Industrial Development Corporation (IDC) Funding
  3. Small Enterprise Finance Agency (SEFA)
  4. The Isivande Women’s Fund (IWF)
  5. Khula SME Fund
  6. Black Business Supplier Development Programme (BBSDP)
  7. Incubation Support Programme (ISP)
  8. National Youth Development Agency (NYDA)
  9. PDF Download

Government Funds

The government created government funding to extend finances to previously disadvantaged South African’s in order to develop black economic development. Your much needed capital investment could come from government funding opportunities.

Financing a small business, whether you’re starting-up or trying to expand, is a challenge all entrepreneurs go through. Here are a few examples of government funding that focuses on black entrepreneurs:

National Empowerment Fund (NEF)

National Empowerment Fund

National Empowerment Fund

The NEF is, a part of the government’s development mandate to encourage black participation in business and entrepreneurship. It helps to assist black entrepreneurs in achieving funding. This fund aims to assist black youth, women and men, communities and businesses to achieve sustainable success.

Types of NEF Funding

The NEF has four main channels of funding that consist of subdivisions. These are:

1. iMbewu Fund:

  • This consists of subdivision is entrepreneur finance, procurement finance and franchise finance.
  • This fund supports black entrepreneurs who are starting up a new business or expanding an existing one.
  • This contribution takes the form of offering debt counselling, quasi-equity and equity finance products.
  • The funds contribution ranges from R250 000 to a maximum of R10 million

2. uMnotho Fund:

  • This NEF funding has subdivisions in finance, new venture finance, expansion capital, capital markets, and liquidity and warehousing.
  • This fund is available to black entrepreneurs who manage or own businesses, new ventures, expanding existing business. It is also available to black entrepreneurs who want to buy a share of equity in black and white owned businesses.
  • The contributions from this fund range from R2 million to R75 million.

3. Rural and Community Development Fund:

  • This NEF fund has subdivisions in acquisition, new venture capital, expansion capital and start-up/green categories.
  • The creation of this government fund is to promote sustainable change in social and economic relations along with supporting and developing the rural economy by financing sustainable enterprises and co-operatives.
  • This NEF funding ranges from R1 million to R50 million.

3. Strategic Projects:

  • This NEF fund has subdivisions of empowerment objectives.
  • The aim of the government fund is to increase black participation in early-stage projects.
  • These projects need to have economic merit and the ability to deliver on the government’s development mandate.

How Can You Apply for NEF Funding?

NEF funding is available for start-up and existing businesses. It will conduct the following processes when evaluating your business:

  1. It will conduct a, self-needs analysis to determine how the NEF funding can assist your businesses needs and which offer is best suited.
  2. You will need to provide an application form and a comprehensive proposal with evidence that supports the commercial viability and financial position of your business.
  3. After you’ve submitted your application to the NEF, it will assess your information for final approval and receiving of funds.
  4. The NEF website offers the following checklist to ensure you include everything needed when applying for funding.
  5. You’ll need to meet all the requirements or your application won’t be successfully considered.
  6. This process can take up to six weeks.
  7. If your application is successful, it could take up to three to four months to receive NEF funding.

Contact Details for NEF Funding

  • For more information about the NEF fund, visit www.nefcorp.co.za.
  • Email general enquiries to info@nefcorp.co.za
  • Or call the following numbers +27 (0)11 305 8000 or 0861 843 633 (call centre).

Read more on NEF Funding here.

Industrial Development Corporation (IDC) Funding

Industrial-Development-Corporation-logo

Industrial Development Corporation

IDC funding is available to those who have an existing business or wish to start a new one; those that have the visions of job creation along with serving previously disadvantaged communities.

The IDC achieves its goals by providing finance for industrial projects, promoting partnerships between and across industries within SA and internationally. It focuses on projects that finance and facilitate, that lead to the creation and innovation of new industries. It also focuses on diverse expertise to drive growth in priority sectors and to take on higher-risk funding projects.

The IDC supports B-BBEE and actively boosts and promotes black-owned and managed business along with those with employment equity. It aims at developing the skills of black employees and business owners, by supporting local, regional, provincial and national government projects.

The Different Types of IDC Funding

1. Development Funds.

  • These funds aim at supporting projects that will have high long-term impacts on the economy through growth.
  • Its aim is to bring projects out of the informal sector and into the economic mainstream.
  • Please find more information on these funds and links to the online application process here.

2. Agro-Processing Competitiveness Fund

  • This government fund provides support and helps businesses to achieve increased competitiveness, business growth, job creation and development in the agro-processing and beverages industries.
  • For further information and a link for the online application process please visit here.

3. Product Process Development Scheme (PPD)

  • The aim of this fund is to provide financial support to micro and small enterprises where the total assets are below R5 million, annual turnover is less than R13 million, and the business employs less than 50 people.
  • The fund intends to promote innovation and technology development with financial support.
  • This enables the development of new products and/or processes.
  • For more information on the PPD Scheme continue to the website here, to apply for funding, please visit their website http://www.idc.co.za/, click on “Online Funding” and follow the prompts.

4. Risk Capital Facility Programme

  • IDC Funding aimed at providing risk finance to businesses owned by previously disadvantaged individuals that offer substantial job creation potential.
  • For more information on the Risk Capital Facility Programme continue to the website here, to apply for funding please visit their website http://www.idc.co.za/, click on “Online Funding” and follow the prompts.

This programme provides three channels of funding:

  1. Direct channel operating alongside IDC’s mainstream business
  2. Through a niche fund channel
  3. Third party channel.

5. Transformation and Entrepreneurship Scheme

  • This fund finances marginalised groups of South Africans such as women and the disabled.
  • The aim of the fund is to gain access to finance that will help to develop and grow your business as a start-up or through expansions or acquisitions.
  • This IDC funding also offers mentorship and non-financial support including business planning, training and mentorship.
  • For more information on the Transformation and Entrepreneurship Scheme continue to the website here, to apply for funding please visit their website http://www.idc.co.za/, click on “Online Funding” and follow the prompts.

6. Green Energy Efficiency Fund

  • The fund aims at improving energy efficiency and helping South Africa become a low-carbon economy.
  • It aims to drive down energy related costs, improve production capacity, operational effectiveness and competitiveness, which would aid in job creation.
  • For more information on the Green Energy Efficiency Fund continue to the website here, to apply for funding please visit their website http://www.idc.co.za/, click on “Online Funding” and follow the prompts.

How Can You Apply for IDC Funding?

The IDC government funds aims are: Job creation potential, rural development, urban renewal and poverty alleviation, the employment of women and youth as well as up-skilling of employees. All of the projects that the IDC funds, need to show economic viability and sustainability and should target previously disadvantaged groups, women, people with disabilities, low income working groups and marginalised communities.

Contact the IDC for funding

  • For more information on any of the funds visit www.idc.co.za, click on “Online Funding” and follow the prompts.
  • You can also phone the IDC call centre on 0860 69 38 88
  • Or email callcentre@idc.co.za.

Read more on IDC funding here.

Small Enterprise Finance Agency (SEFA)

Small-Enterprise-Finance-Agency-logo

Small Enterprise Finance Agency

Do you have an existing small business or want to start one? SEFA are piloting direct finance to entrepreneurs wanting to start or grow a business.

Types of SEFA Funding

SEFA provides direct funding to business in loans between R50 000 and R3 million in three different ways: Directly to business owners, via retail finance intermediaries, and through banks using credit guarantee schemes including Khula.

1. Bridging loans

  • These are short-term loans, which provide working capital.
  • The types of working capital offered by this government fund include stock purchases and operating overheads. This loan is offered for only one year.

2. Term loans

  • This government fund is a loan of a specific amount and has a specified repayment schedule, amount and interest rate.
  • This type of SEFA funding is normally used to finance your assets that have a medium to long-term lifespan, for example machinery, vehicles, office equipment.
  • Term loans can be used to expand your business or for acquisitions.
  • This loan has a repayment range of one to five years.

3. Structured finance

  • Use this SEFA facility for funding that falls outside the parameters of the term and bridge loans.
  • Provided by a debt facility, it can be repaid over a period of five years and tailored to your unique requirements.
  • The following businesses can’t apply from the benefits of this fund: Liquor, tobacco, gambling, sex trade, armaments, speculative real estate, leveraged buy-out funds, and illegal trade.
  • This includes any business activity that would tarnish SEFA’s reputation, political organisation, entrepreneurs under debt review, insolvent business owners and business.

How to Apply for SEFA Funding?

Your start-up and existing survivalist, micro, small and medium business must meet these criteria:

  1. Submit a completed application form
  2. Submit a completed comprehensive business plan that meet SEFA’s application requirements. Include initial and supporting documentation.
  3. Demonstrated ability to repay loans
  4. Personal and business credit references
  5. The applicant must be an owner manager
  6. The applicant must be a South African citizen with ID documents or a valid permanent residence. Alternatively, the business can be in the control of a South African citizen.
  7. The business must be legally constituted including sole traders with a fixed physical address
  8. Must have contractual capacity
  9. All operations including projects, programmes activities etc. must be within South Africa
  10. The enterprise must be compliant with accepted corporate governance practices
  11. A trust that has within the trust deed the power to borrow money and pledge assets as security and to give surety for borrowing.

Contact SEFA for funding

  • Visit www.sefa.org.za for more information on regional branches, how to apply, exclusion criteria, products and services available. To contact head office, call 0860 00 73 32.
  • To apply for Sefa Funding visit their website http://www.sefa.org.za/, you can either submit your application online or you can print it out and submit to their physical offices. You can see the contact information for both online and physical submissions for all their funds here.

Read more on SEFA here.

How to Apply for Enterprise Funding

The Isivande Women’s Fund (IWF)

Isivande-Womens-Fund

The Isivande Women’s Fund

This government fund aims at accelerating women’s economic empowerment by supplying cost effective, user friendly and responsive, available finance. The IWF offers support services to improve the success of your business.

It targets business that are starting up, expanding, rehabilitating, franchising and those that need bridging finance. The aim of the fund is to create self-sustaining black and women owned businesses by offering you primary financial and non-financial support.

How to Apply for IWF Funding

The women owned companies need to meet the following criteria to be eligible:

  1. Operational for 6 months.
  2. Needs early stage capital for expansions and growth.
  3. 50% plus one share owned and managed by women.
  4. Have potential growth and commercial sustainability.
  5. Improving social impact with employment creation.

Contact IWF for funding

  • Businesses that are eligible and need funding between R30 000 and R2 million can submit their application.
  • Apply to the IWF through the IDF website or call +27 (11) 772 7910.
  • Download the application form here www.idf.co.za.

Khula SME Fund

Khula-SME-Fund-logo

Khula SME Fund

Offered by Khula Enterprise Finance Ltd, this government funds aim is to grow and increase sustainability of small businesses.

The purpose of the fund is to:

  • Offers SME’s early-stage and expansion capital.
  • Offer early-stage debt funding to business that meet the criteria.
  • Support SME’s in rural and peri-urban areas.
  • Improve the business owners access to finance.
  • Grow businesses so they can create new jobs.
  • Encourage meaningful economic involvement of black South Africans.
  • Foster entrepreneurship for men and women within the SME sector.

How to Apply for Khula Funding?

The following are the requirements for business wanting to apply for Khula government fund:

  • South African SME who have a majority share in their company and who are seeking to start and/or grow their company.
  • South African SME’s who have a majority share in their business that is in rural areas.

Contact Khula for funding

  • Business that are eligible and need funding can contact Khula at: +27 (0)11 807 8464.
  • To apply for Khula funding, visit the SEFA website http://www.sefa.org.za/, you can either submit your application online or you can print it out and submit to their physical offices. You can see the contact information for both online and physical submissions for the Khula Fund here.

Read more on the Khula SME Fund here.

Black Business Supplier Development Programme (BBSDP)

Black Business Supplier Development Programme

Black Business Supplier Development Programme

The Black Business Supplier Development Programme (BBSDP) is a cost-sharing grant that offers black-owned businesses improve their competitiveness and sustainability.

This government grant does not support start-ups, only the expansions of existing business.

The aim of this government grant is to fast-track small and micro-enterprises, encourage links between black-owned businesses, corporates and public sector as well as to complement affirmative procurement and outsourcing.

It provides black entrepreneurs with a grant to a maximum of R1 million.

Do You Qualify for the BBSDP government grant?

  • Your business must be a CIPC Registered company or corporation
  • 50.1% black owned (Black, Indian or Coloured) or more
  • Management team 50% Black
  • Trading for at least one year and have financial statements to prove turnover.
  • Turnover must be between R250k and R35m per annum
  • Valid SARS tax clearance and Vat registered if turnover is greater than R1 000 000.

How to apply for the BBSDP government grant

The following are the documentation that you need to apply for the BBSDP grant:

  • CIPC Company registration documents (proof of ownership and shareholding)
  • Certified ID of all Directors/ members
  • Certified ID of all managers/ staff training (if applicable)
  • Certified financial statements for latest financial year (three years if available)
  • Management accounts for current year
  • Valid SARS tax clearance (with 3 months to expiry or get a new one)
  • VAT registration document (where applicable)
  • 3 Months bank statements
  • 3 Quotations (comparable) for every intervention
  • Declaration appointing Graphit as the consultant.
  • Company diagnostic questionnaire and application typed on template supplied by Graphit. Please send back as a Word Document
  • Domicillium form
  • Bank confirmation of your 50% contribution (Will you be able to get finance for your 50% or 20% contribution.) (Clear credit record)

To apply you will need to email all your documentation, all your documents need to be in a PDF format except your application form, which needs to be in word format. Please send them as individual documents.

To apply for the BBSDP government grant, send your documents to alan@bbsdp.co.za. For further information visit the BBSDP government grant website here.

Incubation Support Programme (ISP)

Incubation Support Programme

Incubation Support Programme

Designed to create and develop successful enterprises. These are enterprises with the ability to revitalise communities and local economies.

Do You Qualify for the Incubation Support Programme?

In order to qualify for the Incubation Support Programme you need to be:

  • A registered legal entity in South Africa
  • A registered higher or further education institution
  • A licensed and/or registered science council.

This programme is also available to applicants who want to establish their own incubators or wan t to grow and expand existing ones. The incubator may either offer physical and/or virtual incubation support services. The incubator may be a:

  • Corporate incubator
  • A private investor’s incubator
  • An academic or research institution incubator in partnership with industry

The incubator must be focused on establishing and/or growing enterprises that will graduate to sustainable enterprises.

How To Apply for the Incubation Support Programme

  1. Applicants can contact the DTI directly or appointed support agencies.
  2. They can assist you with the application process.
  3. You need to submit a completed application form to the DTI.
  4. This must outline the objectives of the project and demonstrate how the incubator would function and be sustainable.
  5. Submit your applications to the Incubation Support Programme Secretariat at the DTI.

Contact Incubation Support Programme

Application enquiries: appisp@thedti.gov.za

Claims enquiries: claimisp@thedti.gov.za

National Youth Development Agency (NYDA)

National Youth Development Agency

National Youth Development Agency

This government grant is moving away from grants for youth and shifting towards mentorship and development programmes. Grants are however, still available for youth entrepreneurs.

Types of NYDA Funding

NYDA awards individual grants to formal and informal businesses that are in the start-up or development phase of their business. These government grants get awarded to co-operatives, which is an autonomous association of people united to meet common economic and social goals through a jointly owned and democratically controlled enterprise. Additionally, another option is community development and facilitation projects.

Do You Qualify for NYDA funding?

  • You need to be eighteen years old at the time of application
  • Need the grant for business start-up or growth
  • You need to be between the ages of 18-35 years with necessary skills, experience or with the potential skill appropriate for the enterprise
  • South African citizens and resident within the borders of South Africa
  • Are involved in the day-to-day operation and management of the business
  • Require grant from NYDA of not less than R1 000 and not more than R100 000.

Upon approval of the grant, if you are employed full time, you could be required to resign from employment and provide grant officer with proof of resignation. This is a requirement so that you can focus an appropriate amount of time on your venture.

How to apply for NYDA funding

NYDA government grants are available to entrepreneurs or co-operatives that meet the following criteria:

  1. Applicants must be a youth (18 to 35 years old). They must have the necessary skills and experience or show the potential of skills for the business and industry in which they wish to operate.
  2. Applicants must be South African citizens with ID documents and operate their business within South Africa.
  3. The applicant must need the grant to start or grow their business i.e. no other source of capital.
  4. Applicants must involve themselves in the operation and management of the business on a day to day basis and must work on a full-time basis.
  5. The business may be formal or informal and categorised as a micro-enterprise.
  6. The enterprise must show, or have potential to be commercially viable and sustainable
  7. Applicants should be sole traders or in the case of groups have a minimum of five people.

Contact details for NYDA funding

For more information on the NYDA government grant visit www.nyda.gov.za or contact the call centre on 0800 52 52 52.

Learn from entrepreneurs who started in the same place as you and have made it to the big time: 10 Dynamic Black Entrepreneurs

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Alternative Finance – Filling The Gap

Alternative Finance is finance beyond the traditional – it is defined by the financiers’ area of specialisation – by what they specialise in, whom they serve, and how they provide their funding.

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Alternative Finance is finance beyond the traditional – it is defined by the financiers’ area of specialisation – by what they specialise in, whom they serve, and how they provide their funding. It does not replace traditional finance but rather functions as a complementary and additional form of funding.

Alternative financers are specialists – they focus on a particular need and on a specific audience. As a result their ‘how’ is customised to deal with their chosen target market and for this targets unique needs. This applies to the funder’s processes and to their level of flexibility around things such as collateral. An example of this is that a SME may have an existing R1 million overdraft (their traditional finance) secured by R 1.5 million collateral but suddenly they need R5 million for some kind of contract or bridging finance – they need it fast and don’t have that extent of collateral.

The traditional funder cannot provide what they need, their process is too long and their flexibility is too low. An alternative financier providing bridging finance and specialising in SMEs is ideally positioned to fill this gap.

Related: 5 Key Questions To Answer For Raising Funding

One of the most significant differences between a traditional funder and an alternative financier is in their process. In the case of the alternative financier, they have often chosen to deal exclusively with a particular customer base, for example SMEs. As a result, this funder has both an affinity and contextually relevant empathy in working with SMEs.

Not only do they speak the same language the funder also has an appreciation for the time and material constraints of the SME and has developed their processes to cater to this market. This applies most notably to the turnaround time of the funding need and to the assessment aspect – where flexibility around things such as collateral is vital in making the finance happen for the SME.

A traditional funder is unable to meet the deadline of a bridging finance need, submitted on an urgent basis, where the finance is needed as soon as 2-3 days from time of application. A specialised or alternative funder is able to do exactly this. A traditional funder is also unable to find creative methods in solving the SMEs lack of high-value collateral in applying for finance.

This SME has generally already used their high-value collateral for traditional credit facilities but now needs funding for growth or resolution of a temporary cash flow challenge. An alternative financier is able to look at such an application in a different way, and has most likely already established alternative ways to make this happen for the SME.

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How to Guides

CrowdFunding As E-commerce In South Africa

Crowdfunding is the new bank loan, without the pressures of repayments. This is why you should look into crowdfunding your ecommerce business in South Africa – from our experts.

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Nicholas Dilley

“Crowdfunding is the new bank loan, without the pressures of repayments. Crowdfunding is an online method of fundraising that allows people all over the world to put their ideas or pitches onto a digital platform. These pitches are then available for people worldwide to see, and to decide whether or not they would like to support the campaign. There are four main types of crowdfunding: Rewards-based, donation-based, equity-based, and debt-based, each with its own unique purpose,” says Nicholas Dilley of South African crowdfunding platform Thundafund.

“In South Africa, crowdfunding is still a relatively new concept and with many South Africans sceptical about making online transactions, it’s very much a rising industry. Rewards-based crowdfunding has become a growing force. Thundafund is the brainchild of entrepreneur Patrick Schofield, who founded the company in 2013. The way that rewards-based crowdfunding differs from any other form, is that in exchange for the money raised, the project creator is expected to give something back to the backer in the form of a reward. These rewards can vary, anything from a thank you card to a tangible product. However, when selecting rewards for your campaign, it is important that you keep your project and potential backer in mind.”

Related: Kickstart Your Business Through Crowdfunding

In 2017 alone, Thundafund raised more than R8 million, which was almost equivalent to the previous four years combined.

“In South Africa, we say that, realistically, you can expect a maximum of R150 000 in crowdfunding. However, we are constantly being surprised. It really comes down to how amazing your project is, how big the network is, and if the rewards are what people want. There is no reason to believe that any start-up couldn’t raise over  R1 million if founders put the work in and justify how the money will be spent,” says Nicholas.

The rising of Sugarbird Gin

rob-heyns-sugarbird-gin

One of Thundafund’s biggest recent success stories was Sugarbird Gin, which managed to raise R1 086 973. The gin is an idea conceived of by a four-person company called Steel Cut Spirits.

“As a company, we care about crafted products that have a story and an ability to excite, inspire and bring people together. We also have a proudly South African desire to put our produce on the global map, and an interest in great local gins that can use fynbos to create amazing flavours,” says Steel Cut Spirits CEO, Rob Heyns.

Despite having already had success in the industry, Rob and his co-founders identified crowdfunding as one of the best ways to bring Sugarbird Gin to the market.

“All FMCG products face the three-part challenge of competition, barriers to scale and working capital constraints. The model of rewards-based crowdfunding addresses all three of these challenges at the same time,” says Rob.

“By launching via a crowdfunding campaign, we were able to stand out from many other products on the market, and involve our new friends and fans in our ongoing mission at the same time.

“We were able to operate at scale from day one by consolidating these first orders and thus produce great gins at a better price by working with the volumes of more established gin companies. We were also able to access funds upfront before producing batches, which provided the cash flow needed to grow quickly. There are very few better ways than crowdfunding to test a concept, solve cash flow issues, scale to proper production from day one and stand out from the competition. When I decided to go ahead, I studied crowdfunding thoroughly for two months while ensuring that our team had the required skillset to be able to execute.”

Related: How Stokvels Allow You To Make Smart Purchases Through Group Buying Power

With the crowdfunding of Sugarbird Gin, Steel Cut Sprits decided to treat the campaign like the online selling of a product.

“Rewards-based crowdfunding is essentially a form of e-commerce, as you are selling products or services, so we approached it from the angle of an e-commerce campaign. Your product and marketing thus need to be spot on. We employed an evolving product strategy of refining our offers based on sales feedback before and during the campaign. We also applied a plethora of online marketing strategies, including audio-visual, digital marketing, social media, PR and even direct selling to large potential backers,” says Rob.

Nicholas agrees that crowdfunding needs to be approached in a professional manner. Most people will judge your business purely on your crowdfunding campaign and its funding page.

“Businesses and start-ups must have campaigns that appear very professional. The campaign should also be viewed as a marketing exercise that will allow the entrepreneur to test his or her product in the real world and receive feedback. Doing fun activations, like launch parties and events can also be a great way to get the word out there about your project and brand.”

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SAB Transforms Supply Chains

Supplier Development Programmes grow black-owned suppliers and create jobs.

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The South African Breweries (SAB) has invested more than R200 million into creating an inclusive supply chain that incorporates black-owned and black women-owned SMEs through its supplier development programmes, SAB Accelerator and SAB Thrive. In addition, more than 100 jobs have been created through these efforts.

SAB Accelerator and SAB Thrive aim to create a diversified and inclusive supply chain by supporting the growth of black-owned suppliers through business development support and funding. The programmes are two of four entrepreneurship development programmes run by SAB to help create 10 000 jobs in South Africa by 2022 — SAB KickStart, SAB Foundation, SAB Accelerator and SAB Thrive.

SAB’s agriculture programmes also contribute towards the aim to create jobs by growing emerging farmers.     

Related: SAB-Commissioned Research Shows SA Poised To Reap Entrepreneurship Rewards

“From rural entrepreneurs to big business, SAB has laid the foundation to support entrepreneurs and to contribute towards government’s efforts to grow the economy and reduce unemployment in the country,” says Ricardo Tadeu, Zone President, SAB and AB InBev Africa.

“We recognise that one of the major hurdles for SMEs in South Africa is the ability to gain entry into big business and form part of their supply chains. This requires a symbiotic relationship with big business working alongside smaller suppliers.”

SAB Accelerator and SAB Thrive cohesively solve the challenges of creating a healthy pipeline of suppliers that represent the demographics of the country. SAB Accelerator has piloted ten businesses that have created 29 permanent and 79 part-time jobs in a period of just six months, and is currently incubating 24 businesses as part of the official post-pilot intake. SAB Thrive has invested R100 million in seven businesses, which have created 46 new jobs. In addition, the programme has contributed R140 million in new B-BBEE preferential spend.

The SAB Accelerator is an in-house programme dedicated to developing black-owned and black women-owned suppliers. Geared towards fast-tracking participants’ growth, the programme employs ten highly experienced business coaches and ten engineers, offering both tailored business and deep technical coaching to the participants.

It has a three-phased approach consisting of:

  1. Diagnostic: Screening the business’s current situation and systematically identifying gaps and opportunities for growth.
  2. Catalyst: Proposing an intensive three-month coaching intervention addressing key business functional and technical areas of improvement or growth.
  3. Amplify: Providing additional business development to support graduates of the Catalyst Programme.

The SAB Accelerator strongly focuses on enhancing market visibility and access of its participants.

Eligibility criteria:

  • Existing black-owned or black woman-owned suppliers currently servicing SAB’s supply chain at the time of application.
  • Existing black-owned or black women-owned businesses that have potential to join the SAB supply chain based on their product or service.

The SAB Thrive fund is an enterprise and supplier development (E&SD) fund set up to transform the company’s supplier base. The fund was established in partnership with the Awethu Project, a black private equity fund manager and SME investment company. The aim is to invest in and transform SAB suppliers to represent our country’s demographics. SAB Thrive investees benefit from 100% black equity capital and business support.

Related: 6 SAB Entreprenurship Programmes That Provide Business Management And Support

The fund invests growth equity capital into SAB’s existing high-growth black-owned suppliers, furthering their profitable expansion into the SAB supply chain without diluting the black-ownership of these businesses.

Existing white-owned suppliers are provided equity capital to support the enhancement of their black ownership, while facilitating the introduction of black entrepreneurs to their business. The intention is to apprentice the individual to take over the business in the near future.

Eligibility criteria:

  • Black-owned suppliers in the SAB supply chain that want to grow their business through access to black-owned growth equity capital.
  • Existing white-owned suppliers in the SAB supply chain that want to transform their B-BBEE ownership.

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