Black startups to get boost from fund

Startup businesses struggling to secure funding to take their operations to the next level have been flourishing thanks to millions of rand in investment funding from the South African Breweries (SAB) Foundation.

The SAB Foundation launched the Tholoana Fund three years ago; it seeks to benefit historically disadvantaged individuals and communities through entrepreneurial development in South Africa.

Tholoana Fund is a seed grant programme and provides grants between R50 000 and R250 000 to qualifying businesses, depending on their needs.

It is a beneficiary of SAB’s broad-based black economic empowerment investment scheme, SAB Zenzele.

Boipelo Nkadimeng, the head of community partnerships and enterprise development at SAB, says the fund was started to assist small businesses in South Africa that struggle to secure capital owing to a lack of collateral and a poor business track record.

Nkadimeng says the fund has invested a total amount of R14.2 million in 136 businesses since its inception in 2011.

Maloti Mothobi, owner of the clothing manufacturing company Strato Concept Store, was one such business owner who secured investment funding. She says she needed the money to buy machinery and office equipment as well as employ more staff and acquire marketing and promotional items.

Mothobi was awardedR247 000 in funding, which she says has dramatically improved her business.

“I was able to employ an additional designer, and could purchase sufficient stock to see us through our peak periods and for our soon-to-be-launched online store.”

She believes her application for funding was successful because she had all her business documents in place.

While the Tholoana Fund is open to black-owned and black-managed businesses in all sectors, the business must be a startup in initial stages of operation. For instance, the business must be operational for at least six months and must be under three years old. Applications must demonstrate an enterprise’s commercial viability and job creation potential. The business also needs to be compliant with tax laws and any other applicable regulations such as the Companies Act.

The owner must also be involved in the day-to-day running of the business.

Preference will be given to businesses run by women, young people, people with disabilities and people living in rural areas.

Applications will be assessed according to eligibility criteria. An on-site due diligence will then be performed to verify the information supplied by applicants and to further assess the enterprise’s viability.

Application cycles are staggered between January and September. The next two rounds of application are from 30 April to 30 May 2014 and from 1 August to 12 September 2014.

Boipelo Nkadimeng, Maloti Mothobi, , SAB, SABZenzele

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