With sufficient action a win-win scenario may be found and real business growth be achieved

With sufficient action a win-win scenario may be found and real business growth be achieved

Private Equity may provide attractive solutions for well-differentiated firmsPicture1

  • Commercial Funds – e.g. Vumela, Corvest
  • Private Equity Funds, e.g. Spinnaker


In the short term black ownership itself is a differentiation, and for most businesses the only sensible approach is a broad based ownership scheme

  • Allows achievement of triple bottom line
  • Avoids the risk of failed partnerships
  • Through the application of the modified flow-through principle, minimises the amount of equity to be parted with (although minimum remains ~26%)


The longer term strategy needs to consider redomiciling outside of South Africa

  • The hard reality facing South African Entrepreneurs is that the majority of their growth prospects lies outside of the formal economy in South AfricaPicture3
  • South African Entrepreneurs must plan their growth inside South Africa with a reality that in the future they will likely grow outside of South Africa
  • There are increasing case studies of growth opportunities North of the Limpopo and elsewhere globally
  • Real growth is always driven from the core, consequently the South African landscape still provides opportunities to maximise the core transplant this growth elsewhere
  • In many scenarios, it makes sense to unbundle organisations and keep entities below a R50m revenue per annum mark
  • In some scenarios, it already makes sense to move certain commercial activities to e.g. Mauritius or Botswana or other multi-domicile friendly destinations


In general, a challenge is presented to non-majority black owned businesses to focus on differentiation and draw on business networks to safeguard commercial spend

  • In the long run, technological differentiation / intellectual property / though leadership is the only sustainable way to ensure relevance in an environment where you cannot majority own your own business
  • Networks allows set-asides and alternative solutions to optimise inter-business spend and optimise overall TMPS

ieBEE is about empowering businesses negatively affected by the Codes to Grow.