Emerging and Growth Markets | September 27, 2023

Secha Capital inks $15.8 million to back South Africa’s growing businesses

Jessica Pothering
ImpactAlpha Editor

Jessica Pothering

ImpactAlpha, September 27 – Unemployment in South Africa, the worst in the world, remains stubbornly high. Secha Capital is working to strengthen the country’s key jobs creator: small businesses. The firm operates as a holding company, taking equity stakes in companies and providing operational support for their growth.

“We’ve identified a gap in the market,” said Secha’s Rushil Vallabh. “We invest in companies at an inflection point in their growth trajectory.”

Secha has raised 300 million rand ($15.8 million) for its second fund, which has a 650 million rand target. The venture arm of Rand Merchant Bank, 27four Investment Managers and Caleo Capital invested alongside SA SME Fund, a jobs-focused fund of funds that backed Secha for its “track record of job creation, transformation, growth and exits,” said SA SME Fund’s Claudia Manning.

Job creation

Secha has invested in 10 companies that now collectively employ 500 people. The four portfolio companies in Secha’s second fund have created 200 jobs. Secha’s Brendan Mullen told ImpactAlpha the firm intends to make 10 more investments to support the creation of 1,000 jobs in the next five years.