While the wheels of transformation are certainly turning, South Africa’s private equity industry still has a way to go in achieving a truly diverse workforce. This is according to the 2019 SAVCA industry survey, which revealed that the percentage of female and black (as defined in the B-BBEE Codes) professionals within the industry in 2018 increased to 29.6% and 56.9% respectively, up from 21.8% and 50.9% in 2017.
In an effort to ramp up greater momentum in this regard, the Southern African Private Equity and Venture Capital Association (SAVCA), in partnership with First National Bank (FNB) and the SA SME Fund as lead sponsors, has launched a Fund Manager Development Programme (FMDP) with the aim of increasing the number of female- and black-owned and managed fund managers.
Speaking at the programme’s official launch event, which took place recently in Johannesburg, the FMDP Programme Manager, Melanie de Nysschen, said that from the 50-plus applications received, 13 fund managers have now been selected to participate. “The calibre of the applications we received for the inaugural FMDP was extremely high, and selecting just 13 participants was no easy feat.”
The thirteen selected SAVCA FMDP participants comprise seven generalist private equity funds, four infrastructure funds, and two venture capital funds.
De Nysschen notes that an even split was obtained between aspirant and growth fund manager participants. “The programme caters to both aspirant fund managers – first time managers who have an investment thesis but are still in the process of setting up their fund – and growth fund managers who have already set up their fund, have investments under management, and are in the process of raising further capital and scaling their businesses. Given that the programme will cater to fund managers that are in different stages of development or growth, there will be customization of the programme to target relevant areas of development and support for the selected fund managers.
“The intention is not to flood the market with hundreds of new private equity and venture capital firms, but rather to assist the selected high-potential emerging fund managers who can contribute to the broadening of the overall industry,” she explains.
Through classroom-based teaching, one-on-one coaching, mentoring and support from industry stakeholders, the 12-month programme aims to address some of the challenges typically experienced by first-time emerging fund managers such as fundraising, access to networks and working capital facilities, and most importantly ensuring the fund team has the necessary support to successfully execute on their fund’s investment mandate.
“Having identified these challenges, it is critical that the learning content and support delivered through the programme is relevant and practicable in addressing these shortcomings,” notes Tanya van Lill, SAVCA CEO. “Participants will also receive the guidance of dedicated mentors and coaches, along with the added support of shortlisted preferred suppliers who are willing and able to deliver services into these fund managers at preferred rates.”
To ensure the practical relevance of the programme, van Lill says the final quarter is expected to culminate in capital raising presentations to both local and international investors. “The programme is therefore directly aligned to the outcome of participants being 100% prepared to put their best selves forward in the presentation of their funds to prospective investors.”
Through this flagship transformation initiative, van Lill says she hopes to see a substantial increase in the value of assets under management by black- and female-owned and managed funds. “SAVCA remains committed to accelerating the sustainable transformation of the industry by not only developing high-potential black and female fund managers, but also by attracting new talent into the industry,” she concludes.