Finance applications worth R10-billion will be presented to a plethora of funders as part of a provincial funding fair orchestrated through a public–private partnership between the KwaZulu-Natal (KZN) government and professional services company Deloitte.

Representatives from Deloitte, the province’s Department of Economic Develop- ment and Tourism and the provincial treasury shortlisted 40 applicants out of a total of 100. These projects will be presented to a panel of potential funders using a Dragon’s Den-type format during a two-day event that will be held in Durban from April 17 to 19.

Panelists will include venture capital and private-equity investors, development and commercial banks and government agencies.

Speaking at a media briefing in Durban earlier this month, KZN MEC for Finance Ina Cronjé said the funding fair, which is expected to become a yearly event, was born out of a disturbing disconnect between those supplying and those seeking finance. She said there was a perception that there was little funding available when there actually were funders who were frustrated because they could not find suitable projects.

Greenfield and Brownfield Ventures

Shortlisted projects include both greenfield and brownfield ventures that cover agribusiness, biotechnology, construction, boat building, the cultural and creative industries, the tourism and hospitality sectors, plastics and chemicals, telecommunica- tions and transport and logistics, as well as a few municipal and provincial development projects. They are located in both urban and rural areas.

“We focused on bigger projects that can have a significant effect on business and employment growth in KZN,” said Deloitte corporate finance advisory leader André Pottas. He added that the partners had set a benchmark of R10-million to ensure the viability of projects.

Funders

Pottas said many projects presented to the partners that had been rejected had not been ready for presentation to funders. Issues that created problems included resistance to the concept of equity partnerships, a lack of technical expertise and failure to conduct adequate market research and put in place appropriate offtake agreements, as well as poor financial models.

KZN Treasury Infrastructure Manage- ment and Economic Services GM Clive Coetzee said that, because this was the inaugural event, organisers had been especially careful to select projects that would make it worthwhile for funders to attend the fair at their own expense. He said there would be two other ele- ments to the fair – educational workshops that would assist emerging businesses with the practicalities of righting many of the shortcomings identified during the application process, and an exhibition where funders could market their services.

The fair could accommodate 400 delegates who could apply to attend through the province’s business chambers.

“This is not a theoretical talk shop. It is about providing practical, real-world advice on key issues. “We wish to create a platform for funders and applicants to come together. Our involvement ends once the two parties get together. The actual signing of a deal will be between them,” said Deloitte KZN managing partner Guy Brazier.

Although representatives agreed that it was difficult to estimate how many projects would be approved for finance during the fair, a conservative estimate was five, with other deals expected to take place following the conclusion of the event.

The KZN Growth Coalition, a body comprising the provincial government and the private sector, originally raised funding concerns last year.

Deloitte won the tender to research sources of funding available to businesses in the region and compile a database, as well as put in place services to support businesses and entrepreneurs through the funding application process.

The research identified more than 100 government-supported funding sources in addition to the more well-known sources such as commercial banks, private-equity investors and venture capital investors.

The Funding Fair was a natural progression from this research, Pottas said.