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Fund Overview: June 2013
ENTERPRISE DEVELOPMENT FUND
Information Pack
May 2013
Introduction
The ASISA Enterprise Development Fund provides an
optimal solution to Enterprise Development for an industry
responsible for R4.64 trillion in savings and investments.
The objective of the ASISA Enterprise Development Fund is
to create sustainable value for all stakeholders through the
growth and development of small and medium sized
enterprises with a specific focus on enterprise development
and supplier development.
ASISA Chairman
Group CEO Sanlam
“Initiatives like these prove our industry is serious about
making a difference in this country, not just where profits are
to be made, but also in non-traditional areas where the only
gain is the long-term development and strengthening of the
social-economic fabric of our country.” Johan Van Zyl.
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What is the ASISA ED Fund?
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Invest in the
growth of
SMEs to
create
maximum
shared value
for investors,
investees and
society
Create
financial and
brand benefit
for investors
and industry
by delivering
high impact
ED success
stories.
Ensure the
growth and
sustainability
of investees
by providing
best practice
business
development
support.
Provide an
optimal BEE
compliance
solution for
investors that
marries the
spirit and
intent of the
code.
Align to
industry and
government
priorities
with regard
to leading
practice
Enterprise
Development.
The ASISA ED Fund creates sustainable shared value for South Africa and its Funders by managing an industry leading Enterprise
Development Fund that invests in the growth and development of Small and Medium sized Enterprises with a specific focus on
Enterprise Development, Supplier Development and Business Development Support.
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How does it work?
1.
Funding is received from investors in the form of an Investment,
Grant or Loan and ED points are received immediately. Loans
qualify for repayment following the loan term and Investments
qualify for fund ownership, capital preservation and ROI.
2.
The investment management process is based on industry best
practice and is supported by an experienced Fund Management
Team. Investments are identified and screened against the fund
mandate before undergoing thorough feasibility, due diligence
and professional Investment Committee approval.
3.
Ongoing post-investment business development support (BDS
incubation) is provided to the investee enterprises by the Fund
Manager to unlock value and maximise the growth, profitability
and job creation capacity of the investee enterprise.
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What is the key benefits?
IMMEDIATE ED POINTS
TEAM
Immediate and on-going access
to Enterprise Development (BEE)
points
Flexible, tailored turnkey ED
solution aligned to Funder and
SME’s unique needs
Experienced ED Fund
Management and Business
Development Support team
COST EFFICIENCY
MARKETING
Benefit multiplier of up to
1.5% for every Rand spent and
single upfront investment that
counts year on year
Access to investment success
stories for Marketing, PR &
Reputational benefit
INDUSTRY IMPACT
GOVERNANCE
Best practice governance
structure and standards
TURNKEY SOLUTION
RETURNS
Targeted ROI or Capital
Preservation on Fund
performance
Alignment to investor strategy,
Investee needs, industry and
government priorities
How is the Fund Structured?
Black Ownership
Investors
51%
49%
Board of Trustees
BEE Points
ASISA ED FUND
Capital
Capital Returns
Enterprise Development
BDS Incubation
Capital
Finance
FUND MANAGER
Debt
ED Portfolio
Equity
INVESTORS
Small & Medium Enterprises
(Investees)
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Detailed Benefits
1.
The fund qualifies as an Enterprise Development investment in terms of the BEE Codes, thereby
allowing companies in South Africa to secure their Enterprise Development points immediately on deposit.
2.
The fund is a Category A Enterprise Development Beneficiary with a benefit factor multiple of up to 1.
5, thus every Rand spent can be multiplied by 1.5 when establishing ED points for the BEE Codes.
Investors and Lenders retain their ED points year on year until the point at which their funds are returned.
3.
Investors qualify for ownership of the Fund as well as ROI (Return on Investment) on the Fund’s
performance. Lenders qualify for preservation of their loan capital, and all contributors are able to utilise
the investments of the Fund for public relations, marketing and reputational benefit.
4.
The fund is managed by a professional, independent and experienced Fund Management team, so
Funders are not required to pay fees nor dedicate their own human resources.
5.
The investment process and methodology is based on best practice and supported by an experienced
and qualified team.
6.
High ethical and governance standards which include: credible management team and professional
reporting. Detailed annual reports will be prepared for all funders.
7.
The Fund Manager provides post-investment, Business Development Support (BDS) to Investee
companies to enhance the growth of investments and reduce the risk of business failure. BDS may be
provided in conjunction with the ASISA Academy and Members as per the Investee’s needs.
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ASISA’s industry wide supplier database will be used as a primary source for targeting suppliers for
supplier development and investments for enterprise development.
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What do we invest in?
Our Service Offering:
The ASISA Enterprise Development Fund
invests in enterprises which, with the right
assistance, hold the potential to create far
reaching impact. We seek to find high
potential businesses with the required skills
and experience to succeed. We invest capital
and we complement management with
specialist expertise to unlock growth .
We seek to find high
potential businesses
with the required
skills and experience
to succeed.
Our intensive due diligence process identifies sound investments by assessing the
businesses team, market, economics, and customer value proposition and selecting only
those businesses for investment which have the ability to become commercially
sustainable. The ASISA ED Fund will then provide the enterprise with tailored business
development support to assist the growth of the business and resultant social impact.
The ASISA ED Fund aims to invest in enterprises with highly differentiated competitive advantage8/
strategic fundamentals and / or industry supply chain alignment.
Illustrative Investment
Criteria
Description
Funding Requirement
R2,000,000
Turnover
R2,000,000 p/a
Stage of business
Early Growth phase
Geography
Johannesburg
Supply Chain Alignment
Medium
Strategic Fundamentals
High
Growth potential
High
Social Impact
High: Job Creation & Enviro
BEE
Level 3 Contributor
Forecast Return
20% IRR
Winner of the London round of the Global social venture capital competition, Reel Gardening’s unique
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product range promises impact from job creation through to food security and water preservation.
Illustrative Investment
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Business Development Projects
Enterprise & Supplier Development Programs
Initiation &
Strategic
Alignment
Broker
Assessment &
Selection
Business Development Support
Measurement &
Evaluation
Monitoring, Tracking & Reporting
Program Management
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Governance Structure
The ASISA ED Fund is governed by an experienced Board of
Trustees, professional Investment Committee and specialist
Fund Manager in order to ensure:
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Optimal alignment to BEE Codes and Sector Charters;
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High ethical standards, audit and governance
methodologies;
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Leveraged partnerships with industry members and other
financial institutions;
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Professional Fund Administration and reporting standards
including detailed quarterly and annual reports;
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Experienced ED Fund Management and Business
Development Support
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Representation from Industry, Government, Investors, and
the ASISA Foundation as primary beneficiary set up as a BBOS in terms of the FSC.
The Board of the ASISA ED Fund represents leadership from Industry, Government and
ASISA to provide strategic, legal, financial & operational governance to the Fund12
THANK YOU
ASISA, Bridge House Boundary Terraces 1 Mariendahl Lane, Newlands, 7700
T: +27 (0)21.673.1620 F: +27 (0)21.673.1630 PO Box 23525, Claremont, 7735 South Africa