SOUTH AFRICA – Black-owned venture capital firm Empowerment Capital Investment Partners (Pty) Ltd, has appointed Bongumusa Makhathini as its first Chief Executive Officer.
The Harvard Business School graduate and current chairman of the SABC Board has held several directorships, including at South African Breweries as Director of Corporate Affairs & Transformation, British American Tobacco as Director of Legal & External Affairs and African Commercial Diplomacy Consulting as managing director.
During the 2020/21 financial year, the South African venture capital firm, Empowerment Capital Investment Partners (Pty) Ltd has placed more than US$14 million into more than 20 South African start-ups through its three investment funds – Andzani Ventures, Imvelo Ventures and Thuthuka Nathi Ventures which are backed by South African corporates Sappi, Shoprite Checkers and Capitec Bank.
Started in 2015 by Anton Baumann and Mark Fitzjohn, Empowerment Capital is seeking aggressive growth as it enters the next phase of its business to raise funding with institutional investors for further support of the SMME sector.
Its focus for the next 24-month growth phase is a second raise of third-party institutional and international investment into a portfolio of de-risked investment assets backed by strong listed corporate partners that both value financial returns and which naturally meet social upliftment and transformation objectives.
“Our next phase of growth requires a visionary leader with an exceptional track record, an extensive network and an understanding of the South African business landscape. Bongumusa more than meets these requirements but, most importantly, shares our vision for implementing investments that can catalyse sustainable transformation in South Africa. We are delighted to welcome him on board,” says Anton Baumann, Executive Director at Empowerment Capital.
Empowerment Capital executive directors Anton Baumann and Mark Fitzjohn believe they have built a solid foundation for the business and with the board’s backing, they have put systems, processes and qualified resources into place to support the company’s long-term growth and contribution to the SMME sector.
As it embarks on aggressive fundraising over the next 24 months, the company believes there is ample opportunity for investment in South Africa with promising start-ups regularly being introduced to the market.
“Our next phase of growth requires a visionary leader with an exceptional track record, an extensive network and an understanding of the South African business landscape”Anton Baumann – Executive Director, Empowerment Capital
Just like other venture capital investors, Empowerment Capital faces the challenge of how to raise capital from the right investors and place the capital with the right entrepreneurs even though the support offered by Empowerment Capital’s corporate partners helps to mitigate the risk of investment and market access.
“The Empowerment Capital portfolio has grown, and I will leverage the current portfolio and network for further growth. In addition, I plan to drive the vision of transformation and bridging inequality while looking at transformation not just in terms of colour but also in creating jobs for those who need jobs. I am bringing collaboration, vigour and discipline to stay true to the original vision, so not much will change in terms of the business fundamentals, but I envision that my role will support a significant scaling of this operation to further solve the problems faced by society,” says Makhathini.
“Successful businesses and their owners require different forms of support as they evolve from concept to start-up to that of a sustainable and profitable company. The South African environment is dominated by large and established market players. We provide support to SMMEs at various stages of their growth path while ensuring that the capital invested goes to supporting sustainable growth. We are hugely excited to be working with Bongumusa Makhathini because he has time after time put his values ahead of his personal best interests. Bongumusa leads by example and shares the characteristics of a great entrepreneur in his own right,” says Fitzjohn.
“What attracted me to Empowerment Capital is its unique business model which is a solution to many real South African problems It is obvious to see the potential of the business model to generate financial returns for investors, but more importantly, to solve the issue of youth unemployment and to drive meaningful transformation and economic upliftment by backing strong and visionary entrepreneurs. At the same time, Empowerment Capital is eradicating the mindset that BEE compliance is an expense to companies by creating investment engines that support existing suppliers in a commercial manner,” says Makhathini.
The deals closed, span a range of sectors including agriculture, food and beverage, but with a bias towards a variety of technology platforms and marketplaces which all provide their corporate investors with strong transformation prowess, a promising model for attractive returns on their investment while also addressing their transformation objectives that most often go beyond black economic empowerment scorecard requirements.
Empowerment Capital has invested in companies such as Acumen Software, Quench Delivery, Zulzi On Demand, Bizzamm, ForGood, Moneyworks Financial Services, Kinektek, Ice Media Group, Cliqtech, Xago Technologies and Lipa Payments.
“If you are aligned to long term growth of our economy and nation building, there should be no question on your ability to generate substantial returns on your capital. I believe that the venture capital market in South Africa will be led by corporates offering market access in an all-inclusive manner thereby achieving a combination of commercial returns and social impact which is the purpose of Empowerment Capital. I am excited about playing my part in achieving this vision”, says Makhathini.
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