Foreign donors invest R43,5 million in SA Small Businesses

South African business plans has become extremely popular amongst foreign investors in recent months. In addition to the article in the South African Venture Capital blog which earlier reposrted a boost from foreign Venture Capital funds investing in SA Small businesses. Small businesses with viable business plans in South Africa has already gained more than R43,5 million from foreign donors according to the South African Times


South African small businesses competed against other emerging countries for foreign investment, with foreign donors investing R43,5 million in the country's small businesses this year, an increase of 89 percent from last year, the Small Enterprise Development Agency said on Wednesday. 

The agency said this increase was due to its improved financial management and stable leadership, adding it also meant there was confidence in the agency's role to develop and support small enterprises, chairman Linda Mngomezulu said at its annual stakeholders' meeting. 

The Global Entrepreneurship Monitor report published in May showed that one in eight people started a business in emerging nations such as India, Chile and Brazil, whereas in SA the figure was one in 13 
While the agency could not identify the foreign investors that were supporting local small businesses, SAB Miller, Sasol and Bidvest were examples of local companies which had put significant funds into training programmes and enterprise development. 

Mngomezulu said the agency would 'further roll out plans' to make it a 'centre of excellence for business development'. 

However, according to a survey released by Finscope earlier this month, the growth of small businesses is still slow in SA, with only four percent of entrepreneurs aware of the services offered by the agency. 

Agency CEO Hlonela Lupuwana said the organisation would respond to these challenges by 'strengthening partnerships with provincial and local government agencies and developing a client journey model which prioritises interventions in small businesses'. 

The agency's l earning academy trained 750 people this year, with 70 percent of those starting their own businesses, she said. 

Lupuwana said, however, that the agency did not want to focus only on the number of businesses assisted, but also on producing quality businesses that would have a real effect on economic growth. 

The global economic crisis had proved 'devastating to the vulnerable small enterprise community' but it was at such times that the value of the agency ' was best revealed as creating an environment which prevented the recession from dampening the country's entrepreneurial spirit'. 

She acknowledged that the agency needed to raise awareness about its services. Consequently, the agency intended to develop high-profile visible projects, hire more staff at branches around the country and bump up delivery of its products and services.


SEDA who on a regular basis fund a wide range of business plans and ideas in SA is encouraged by the support from foreign investors.