South Africa’s Womvest, a network of women in the investment ecosystem creating shared value for one another through collaboration and mentorship, has launched Womvest Ventures, an investment vehicle that seeks to provide purpose-driven and flexible finance for women-owned and led businesses.
Founded last year, Womvest aims to enable and support the participation of women in the investment ecosystem, be they professionals, entrepreneurs, or investors, by providing access and visibility to talented and ambitious women. The Womvest Mentorship Matching Program is run bi-annually, and it also curates networking events for its members.
Now, for its debut investment opportunity, Womvest Ventures has partnered with Secha Capital, a South Africa-based private equity impact fund, to launch its impact-linked loan facility. The facility provides short-term and impact-linked finance to women-led small and growing businesses (SGBs) within Secha’s portfolio that are struggling to access working capital finance at affordable rates and on appropriate terms.
The instrument’s impact-linked mechanism rewards the business for on-time repayment, as opposed to penalties, and financially incentivises the achievement of pre-determined social impact milestones.
“How investment capital is structured directly affects behaviours and outcomes – it can reinforce existing negative behaviours or incentivise positive behaviours for all stakeholders. This facility has been designed to provide impact-linked capital that works for the women it supports whilst delivering a competitive financial return to investors,” said Maya Burney, founder of Womvest.
The facility has been seeded by a group of women investors in the Womvest network. Brendan Mullen, managing director of Secha Capital, said his firm embraced new ways of supporting its portfolio companies along their growth journey.
“We have seen first-hand the struggle in accessing affordable short-term capital for SGBs. This facility directly addresses a gap in the market whilst embedding specific impact outcomes,” he said.