SA’s Hlayisani Growth Fund announces first close at $23.8m

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South Africa’s Hlayisani Growth Fund has announced its first close at ZAR350 million (US$23.8 million) to invest into high-growth, high-impact businesses, and revealed its first seven portfolio companies.

Private equity investment company Hlayisani Capital is focused on the SME ecosystem, tackling the existing funding gap between early-stage venture capital and more traditional private equity in South Africa. 

Its first fund offers strategic support and capital to high-growth, highly scalable SMEs with a proven track record, and specialises in growing these SMEs into large, successful enterprises that operate across multiple territories, create jobs and generate export revenue domestically.

The first close of ZAR350 million (US$23.8 million) was led by Standard Bank and prominent South African family offices. Investors were attracted to the Hlayisani team’s proven return on investment track record, with the previous venture capital fund returning more than 45 per cent IRR. The measurable social impact of the portfolio also played a role, while the sector offers a significant investment opportunity.

The Hlayisani Growth Fund has also announced its first seven investments, all made last year. They are Snapplify, GoMetro, Wyzetalk, LEAP, Opennetworks, Sudonum and Ikeja, who secured a combined ZAR200 million (US$13.6 million).

Investments are chosen for their sustainable growth and above-average returns potential, as well as their strong focus on delivering a positive socio-economic impact. These businesses are expanding globally and operating on six continents, and have since July 2019 more than doubled their number of employees.

Dr Reuel Khoza, Hlayisani Capital’s chairman, said in order to unlock much-needed economic growth in South Africa, investors must support and invest in entrepreneurs as well as small and medium enterprises. 

“With the successful first close of the Hlayisani Growth Fund, we are privileged to increase our capacity to do this,” he said.

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