Investment vehicle, the SA SME Fund has partnered with nonprofit funding entity Masisizane Fund to create a R70-million fund – the Masisizane Franchise Fund – to invest in black-owned fuel station dealerships.
The fund is expected to create long-term wealth and economic opportunities for black entrepreneurs, spark much-needed economic stimulation in townships, rural and peri-urban areas and help oil companies accelerate their transformation commitments and goals.
SA SME Fund contributed R50-million and Masisizane Fund R20-million in funding.
The Masisizane Franchise Fund will not only provide funding for entrepreneurs to buy and expand a fuel station franchise, but will also offer business support in the form of mentorship and business advisory services.
It is aimed at enhancing the participation of previously disadvantaged individuals, especially women and the youth, in the fuel retail industry.
“Our vision is that the fund will encourage economic activity and job creation in areas of our country that need it most. Our purpose is to create jobs and to provide the right opportunities for black entrepreneurs to build inter-generational wealth, while achieving attractive returns for the fund.
"The fund invests in what we believe is a sweet spot; an ever-present demand for fuel, the availability of large tracts of prime, unused land in townships and rural areas, and oil companies’ desire to transform. This creates a perfect opportunity for success,” comments Masisizane Fund CEO Zizipho Nyanga.
“We are delighted to partner with Masisizane on this very important initiative. We believe that this fund will go far in creating and establishing real wealth for black entrepreneurs, in an industry that has been resilient despite the subdued economic environment.
"Masisizane has a solid record of providing entrepreneurs with the perfect mix of financial and business support, so we look forward to their future successes,” SA SME Fund CEO Ketso Gordhan adds.
The SA SME Fund was established in 2016 by big business to support entrepreneurs.
Masisizane Fund was established by financial services firm Old Mutual in 2007 and provides development finance and business support to small, medium-sized and microenterprises.