Small and medium-sized enterprises (SMEs) are internationally acknowledged as vital to socio-economic growth and stability. In South Africa, they account for about half of the country’s annual gross domestic product and for the majority of new jobs currently being created in the country.
“Independent enterprise is a meaningful vehicle of empowerment. And now more than ever, the doors to entrepreneurship are open for every-one with vision, a viable business plan and appropriate skills,” says Business Partners MD Jo Schwenke.
He adds that access to finance for SMEs is easier than it has ever been. Obstacles and challenges that previously seemed insurmountable are being tackled by government through initiatives such as the Accelerated and Shared Growth Initiative for South Africa and tax amnesty to create a friendly environment for small and medium-sized entrepreneurs to operate in.
“Large infrastructure projects are one of the most important drivers of entrepreneurial development and South Africa is making major investments in energy, transport and communications,” says Schwenke.
Eskom is set to spend just about R100-billion on infrastructure expansion over the next three years, Telkom is upgrading and developing high-speed national and international broadband capacity, and the Gautrain, Moloto and Klipfontein rail projects are already under way.
Business Partners, in particular, has focused its attention on increasing accessibility to investment financing for all categories of entrepreneurs in recent years.
During the 2005/6 financial year, the company approved 633 investments to the value of R740-million.
“The most important thing we consider is the vision, drive, skills and experience of the entrepreneur and the viability of his or her business plan.”
Business Partners’ investment model, does not require that applicants are able to provide security or invest capital, although it will make a difference in the structuring of the deal. If a business plan is considered viable, Business Partners customises an investment and services package for the business, taking into account whether or not the entrepreneur has an own contribution to make.
“This model ensures that an existing or potential entrepreneur with a good business plan and the right skills and experience for the job obtains the necessary investment for the venture. “And each investment is supported by the appropriate mentorship, consulting, property broking and property management services to ensure the greatest chance of long-term success,” he concludes.