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Social Enterprise Masterclass Challenges Delegates to Build Sustainable Organisations

The concept of social enterprise has gone mainstream over the past few years, reflecting a desire for new ways to create economic value in a manner that delivers measurable social impact. This year’s Global Entrepreneurship Week kicked off on 10 November at the continent’s largest start-up campus, 22 on Sloane in Bryanston. On Wednesday 15 November, the venue hosted masterclasses on various aspects of entrepreneurship such as social entrepreneurship, funding strategies for small business, purpose-driven enterprise, as well as inclusive growth.

The first session, Social Enterprise and Impact Investment, kicked off with Mbali Zamisa, enterprise Programme Coordinator of the South African Breweries Foundation talking about various SAB Foundation enterprises that seek to fund various small businesses. These include the Tholana Enterprise, which seeks to empower marginalised groups such as women, youth and rural business.

The room comprised mostly of determined and engaged entrepreneurs whose business’ life span ranged from one to five years old. Rudzani Mulaudzi from Grades Match and Nneile Nkholise from Likoebe Innovation Consultants spoke about impact investment and measurement.

No let-down was The Disruptors author Kerryn Krige’s talk on the complexities and contradictions of social entrepreneurship and especially what it really is. Her talk featured many salient questions and statements that served as food for thought for entrepreneurs:

  • How am I going build stability in this organization?
  • Legitimacy and authenticity are inextricably linked
  • Funding social value in a sustainable way
  • Social enterprise blends income methods which enables you to have control over the types of income you bring in
  • It’s not about how much money you get!

 

Other important take-aways were about were remembering that ‘‘your story is more important than your numbers but use numbers to back up your stories (“finance people aren’t as stupid as they look!”), and the importance of doing homework on your investor, needing your investor to offer more than just money, and enhancing your own ‘‘investability’’.

The Future of Sustainable Job Creation talk with Managing Director Zanele Luvuno of Transcend Talent Management explored the ways in which policy creation can aid job creation and exposed challenges with implementing BEE legislation. The objective was to invite professionals to see beyond corporate life and tap into research and business development facilities to pursue small business development.

The last session on Integrating the Township and Informal economy by Sifiso Moyo was a dialogical sitting that had all delegates debating on the ways in which the township could benefit more from entrepreneurial ventures. Moyo asked critical questions that involved historical facts, relevant statistics and real-life case studies to observe and analyse successes and failures of a few entrepreneurial ventures in the township. The theme of the Township Renaissance was an indispensable topic that pushed the entrepreneurs, many who are from the township, to shift mentality and think of innovative ways of serving their communities with the intention of creating a strong township eco-system in which the rand would circulate numerous times and not only once in a context where R2.2 billion rand is generated out of township economy annually. This challenge presented the opportunity for township entrepreneurs to become real and legitimate competitors with big competitors and franchises.

Global Entrepreneurship Week endeavours to host more events in which more entrepreneurs will actively and consciously engage with like-minded peers who have succeeded such as Vusi Thembekwayo, who graced this week’s first event. The Masterclasses were informative, thought-provoking, and mostly motivating to the passionate and driven young youth who came to learn from the best in the business.

Written by: Gabaza Tiba (Makhaya Advisory)

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inspiration Investment management mzansipreneur

How private equity takes business to the next level

Author: Southern African Venture Capital and Private Equity Association (SAVCA)

In Southern Africa, the impact and value created through private equity extends far beyond just that of a specific deal’s allocated investment, it is also about positively influencing businesses, the communities connected to these businesses, and their broader economic environment. This is according to the recently launched SAVCA 2017 Case Study Compendium (see here) which highlights how private equity investment is resulting in more sustainable business practices and positive community outcomes.

The publication – comprising of sixteen case studies showcasing successful private equity and venture capital partnerships between fund managers and the businesses in which they invest – underscores the long-term nature of these collaborations and confirms the value add offered to both start-up and established businesses.

Tanya van Lill, CEO of the Southern African Venture Capital and Private Equity Association (SAVCA), says that these case studies confirm that partnerships of this nature represent a great deal more than just monetary investment. “Private equity plays a vital role in corporate governance, job creation, employment equity initiatives, skills programmes, and social upliftment, thus rendering the portfolio company more resilient, more efficient, with healthier governance structures and with an expanded footprint.”

Technology is a recurring theme from the SAVCA 2017 Case Study Compendium, adds van Lill. “Some of these companies have introduced systems to manage their operations more efficiently, while others have introduced new technology to the market. An example of this is seen in the Emfuleni Voerkrale case study, where the sheep feedlot company was backed by IDF Managers in 2015 to acquire a state-of-the-art electronic scale to weigh animals. This allows management to easily access and analyse data on each animal, which has enabled faster and more efficient decision-making.”

Categories
beneficiation competition industrial inputs Investment political economy

ARCELORMITTAL TO PAY R1.5 BILLION FINE FOR CARTEL BEHAVIOUR, COMMITS TO PRICING REMEDY

Media release from the Competition Commission: 

The Competition Commission (Commission) has reached a settlement agreement with ArcelorMittal South Africa Limited (AMSA), finalising all pending investigations and prosecutions against AMSA. In terms of the agreement, AMSA admits having been involved in the long steel and scrap metal cartels, and agrees to pay an administrative penalty of R1.5 billion (one billion five hundred million rand). Furthermore, AMSA has agreed to remedies relating to complaints against its pricing conduct without admitting that its pricing conduct constituted a contravention of the Competition Act. In this regard, AMSA has undertaken that for a period of five years it will limit its EBIT (earnings before interest and tax) margin to a cap of 10% for flat steel products sold in South Africa. In addition, AMSA has committed to a R4.6 capital expenditure over the next five years. The Commission has, in turn, agreed that the settlement will cover all pending cases against AMSA including those that are still under investigation.

Today, 22 August 2016, the Commission filed an application with the Competition Tribunal (Tribunal) for confirmation of this settlement agreement as an order of the Tribunal. The agreement relates to various cases that the Commission has investigated against AMSA, some of which were subsequently referred to the Tribunal for adjudication. The following is a summary of the cases and the Commission’s findings.

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Investment Notices

Abraaj Group beds down deal with Nigerian mattress manufacturer Mouka

Announcement from the company:

Lagos, Nigeria, 7 July 2015: The Abraaj Group, a leading investor operating in global growth markets, today announced the acquisition, through one of its Funds, of a majority stake in Mouka Limited, a leading mattress manufacturer in Nigeria. In partnership with the Moukarim Family, Abraaj acquired its stake from previous shareholders, Actis and the founding family, with the latter retaining a minority stake in the Company.

Moukarim Metalwood Factory Limited, the precursor of Mouka Limited, was established in Kano, Nigeria in 1959, producing furniture and allied metal products for the bedding industry. In 1972, it started supplying raw materials to the industry and built a foam manufacturing plant in Lagos. The Company acquired an additional foaming plant in Benin in 2005 and built a third plant in Kaduna, Nigeria in 2009.

Today, Mouka is a household brand name in Nigeria and a leading manufacturer in the Nigerian foam and bedding space. The Company has an extensive distribution network across the country, partnering with over 500 distributors who operate through more than 1,000 outlets. Abraaj, in partnership with the Moukarim family, will draw on its significant regional investment expertise to consolidate Mouka’s leadership position in Nigeria, and will look to expand the business further into the West African market.

Abraaj and the Moukarim family will focus on enhancing Mouka’s product offering, customer service, as well as its sales and distribution strategy by increasing its market penetration across the region. Abraaj, which invests with a rigorous approach to sustainability, plans to further strengthen the corporate governance structures already in place within the Company, and optimize the health and safety standards at Mouka’s production facilities, including key areas pertaining to fire safety and chemical storage, amongst others.

Mustafa Abdel-Wadood, Partner at The Abraaj Group, said: “Abraaj is one of the most active investors on the African continent, with a particularly strong track record in Nigeria… We’ve long been interested in the mattress-manufacturing space, and have carefully reviewed a number of opportunities in the past. The market opportunity for high quality sleeping products offers good potential for growth, and we believe Mouka is very well positioned to capitalize on this.”

Zahi El Khatib, Managing Director at The Abraaj Group, commented: “Mouka has long established itself as a household name in the Nigerian sleep products industry through its dedication to high quality manufacturing standards. Its products have come to represent quality, comfort and durability, and Abraaj together with the founding family intend to build on the strong legacy of the Mouka brand to consolidate its leadership position. We look forward to expanding the Company’s product line into adjacent categories within the bedding space, and growing the product offering to cater for different commercial and industrial applications of foam.”

Hasib Moukarim, non-executive Director of Mouka, added: “The Moukarim family recognized the Abraaj team’s deep local experience and the Group’s successful track record of developing businesses in growth markets globally. We are confident that Abraaj is the ideal investor to carry Mouka into its next phase of growth and look forward to our partnership.”

Earlier this year, Abraaj invested in Turkey’s leading mattress and sleep products manufacturer, exporter and retailer, BRN Sleep Products. In Sub-Saharan Africa, Abraaj has over a decade of investing experience, and its portfolio in Nigeria includes Fan Milk Nigeria, AOS Orwell, C&I Leasing, Custodian & Allied Insurance, Computer Warehouse Group, The Bridge Clinic & PathCare, and Lily Hospitals.

Related coverage

Abraaj profile

Categories
economic policy Investment Video

SAVCA panel discussion on Growth, Policy and Deal-Making Context

From SAVCA:

Dear Southern African Venture Capital and Private Equity Association members and friends

Earlier this year SAVCA hosted a panel discussion, moderated by independent economist Trudi Makhaya, which examined South Africa’s policy, growth and deal-making context.

The guests were Nick Binedell (GIBS), Colin Coleman (Goldman Sachs), Garth Towell (formerly of Kimberly Clark SA), Grant Pattison (formerly of Massmart), Mzi Mjekevu (Barclays) and Ryan Wood-Collier (AfrAsia Bank).

Our guests’ frank views are captured in this video collage:

YouTube video here: http://youtu.be/eJSyfFshDHs

SAVCA website: http://www.savca.co.za/