CASE IN POINT // SEFA
By: Valdi Pereira
Entrepreneurial Friendly Approach
A quick conversation with any budding entrepreneur will reveal one of the most daunting challenges they face is securing funding. Often they find themselves dealing with organisations that are not attuned to the needs of entrepreneurs or for that matter, even understanding of their business aspirations.
“One of the most important things I have learned in my role as CEO of the Small Enterprise Finance Agency (sefa), is that you need humility and sensitivity when dealing with entrepreneurs,” reveals Thakhani Makhuvha. “We deal with so much more than business plans. Each one of the funding proposals we are asked to consider, carries within it, the hopes and aspirations of people who are dreaming of a brighter future.”
sefa was established in April 2012 when the South African Micro-Finance Apex Fund, Khula Enterprise Finance and business activities of the Industrial Development Corporation (IDC) merged. As the newly appointed CEO, Thakhani spent the first part of his tenure bedding down the merged entity and dealing with the challenges that are inherent to any corporate activity.
“The merger process taught me that there is no such thing as ‘too much communication’. Team members have the right to know what the future holds for them and how actions the organisation is taking will affect them,” he notes.
The lessons he learnt in terms of the power of ongoing engagement have been put to good use in his dealings with finance applicants. He does not shirk contact with them and is always willing to engage directly if they want to talk to him.
“At sefa we place a high premium on corporate governance and ethical behaviour. However, I am always willing to deal directly with applicants and listen to their challenges and hopefully learn how we can offer a better service. It’s important to adapt to the environmental challenges entrepreneurs are experiencing and I can only do this if I am open to engaging with them.”
With a keen focus on remaining flexible and attuned to market needs it is no surprise to learn then that in 2013 sefa teamed up with the National Youth Development Agency (NYDA) and the IDC to support one of the New Growth Path goals to create 5 million new jobs by 2020.
In terms of the agreement the entities work together to fund young entrepreneurs. The IDC contributed R1bn to the fund and sefa committed R1,7bn. The NYDA plays an important supporting role in screening and recommending young entrepreneurs to the finance offered by the entities.
“During the past two years, we have distributed about R450mil to young people,” shares Thakhani. “We focused intensely on making young entrepreneurs aware of the funding opportunity that has been created.”
While working with youthful entrepreneurs is a tremendous source of inspiration for him. He notes that challenges do exist. “We see a lot of good ideas, but often young entrepreneurs are vexed by challenges of scalability. They are not always sure how to take the next step with their product or service and how to work towards a long-term vision for their business.”
He believes that with guidance and support from experienced institutions and mentors, these challenges can be overcome: “Young entrepreneurs are committed to achieving success. If we give them our support, I am confident we will see the positive results.”