A Comprehensive List Of Angel Investors That Fund South African Start-Ups

An angel investor is usually a high net-worth individual or group that provides capital to start-ups. They are referred to as angels because they are willing to invest their personal funds into a struggling higher risk business, when no one else will. Just like funds and incubators, some angel investors will focus on a specific industries.

What is an angel investor?

“Angel investors got their name 100 years ago in New York City when struggling playwrights – with limited financial means – had theatrical productions funded by a wealthy and visionary individual usually at the last minute,” explains David Newton, professor of entrepreneurial finance and head of the entrepreneurship programme, Westmont College, California.

He says that this generosity was associated to angels floating down from heaven with money so the show could go on. However, these angels were astute investors with keen eyes for investments that would achieve high profits. Angels fund a business to get in on the ground floor of an opportunity for financial gain.

The difference between an angel investor and a venture capitalist

Venture capital funding usually comes from a firm with people selected to help your business develop. Venture capital firms are comprised of professional investors. The capital is generated from a variety of sources such as corporations and individuals, private and public pension funds, and foundations.

A venture capital firm is looking for businesses with high growth potential. They will then buy shares and have a say in the future of a business, in exchange they expect a high return on investment.

The pros and cons of choosing an angel investor

The funding an angel investor can bring to the table could make all the difference in getting your start-up off the ground, but there are a few trade-offs you need to be aware off:

The pros

  • Angel investors are usually entrepreneurs themselves, who understand the level of risk involved in investing with you, and so they won’t require you to jump through as many hoops as with a typical business loan.
  • An angel investor will offer you capital in exchange for an ownership stake, which means you won’t have to repay their investment.
  • Angel investors bring years of expertise and already understand the challenges your business will need to overcome before reaching success.

The cons

  • The cons of an angel investor taking on high risk start-ups is they usually have high expectations. It isn’t unusual for an angel investor to expect a rate of return 10 times their original investment within the first 5-7 years.
  • Offering up a portion of ownership to the angel investor can limit your start-up’s capability of realising a profit, if you don’t carefully assess the terms.
  • The angel will want to take an active part in making decisions, or they’ll want you to explain the reasons behind some of your decisions.

Here is our comprehensive list of 43 angel investors interested in South African start-ups:

  1. Ernst Hertzog
  2. Brett Mason
  3. Avi Eyal
  4. Joel Gascoigne
  5. Brett Dawson
  6. Michael Leeman
  7. Lawrence T Levine
  8. Saul Klein
  9. Mohamed Nanabhay
  10. Sean Emery
  11. Vinny Lingham
  12. Bukola Jejeloye
  13. Kresten Buch
  14. Abu Cassim
  15. Pardon Makumbe
  16. Charles Lorenceau
  17. Justin Stanford
  18. Zachariah George
  19. Daniel Guasco
  20. Craig Raw
  21. Rob Stokes
  22. Mark Levitt
  23. Alvin Singh
  24. Dean Cannell
  25. Llew Claasen
  26. Ari Lustbader
  27. Tommy Chia
  28. Mark Pretorius
  29. Henk Kleynhans
  30. Michael Jordaan
  31. Dotun Olowoporoku
  32. Abrar Ahmad
  33. Michael Greve
  34. Wayne Gosling
  35. Jordan Wainer
  36. Paul Brown
  37. Dan Stephenson
  38. Malcolm Gray
  39. Richard Rose
  40. Mark Forrester
  41. Shlomi Podgaetz
  42. Jesse Hemson-Struthers
  43. Cassian Coquelle and Hendrik du Preez and Andre Bottger
  44. Angel Investor Networks

Source: Entrepreneur Magazine

‘Stay focused, keep on moving, and find some cheerleaders in your life’

It’s an unusual combination of skill sets to have in business: the ability to hyper-focus with steely determination on your business goal, and simultaneously look around for someone other than yourself to inspire and support you. Clearly this talent for managing the hard issues side-by-side with the so-called ‘soft’ issues in the financial business space has worked well for Alida De Swardt, CEO of RMI Investment Managers.

It might have something to do with the fact that while exhibiting all of this single-minded goal orientation early on in her career, she was offered a position in her dream company, RMB, by a woman who became – and remained – De Swardt’s mentor for the entirety of her own tenure as Head of Treasury at RMB. So De Swardt speaks from first-hand experience when she emphasises the importance of mentors and cheerleaders.

In fact, whatever subject she’s discussing, she seems to always be balancing the hard-core business aspects with liberal doses of emotional intelligence. So while she has this unshakeable belief in putting your goals front and centre of everything you do, she also believes that the universe gives you what you put out there.

In this Quick Insight, extracted from a full length interview, De Swardt addresses these concepts from the perspective of young entrepreneurs and professionals who are starting their careers.

Watch the full length interview here.

Moneyweb, in partnership with FNB, presents this bespoke leadership video series with top business people. The interview draws on the person’s life, failures and the lessons they have learnt on their journey to the successful leadership positions they hold today.

Source: Money Web (in collaberation with FNB)

Six common cash flow issues and how to avoid them

By Simon Paterson, Partner at Surrey accountants, RJP LLP

Managing cash flow is one of the biggest challenges a small business owner has to overcome. It is the reason why many sound businesses often fail. They have a fantastic product or service, but cash flow problems and an inability to raise the finance they need in the short term can mean they cannot meet their liabilities and hence they fail. According to recent US research, it is the reason why 82% of small companies fail.

Understanding how to manage cash flow effectively and keep things running smoothly is absolutely essential for every business owner, whether you are a sole trader, partnership or limited company. Here are 6 common challenges a company can face when it comes to managing their cash flow with practical advice on how to overcome them.

  1. Paying staff salaries on a weekly basis

In some industries, it is considered the norm to pay staff on a weekly or fortnightly basis. This is common in the construction and hospitality industries but the downside is it results in cash having to be found on a weekly basis, which means a constant drain to cash flow levels. It is especially problematic when staff are being paid weekly and yet customers are on 30 days or more payment terms. Moving staff to monthly payments will ease the cash flow burden.

  1. Poor credit control function results in customers paying too slowly

Customers paying too slowly is a big reason why businesses can struggle with cash flow. Having a good credit control function in place, which ensures that income is received on a regular basis and within credit terms, is absolutely essential. Consider having a dedicated person to take care of credit control or outsource it to a specialist.

Start off by making sure the customer gets the invoice in the first place, so there are no excuses. Then follow up again just before the invoice due date, to ensure that if there are potentially going to be delays, you can plan ahead for them. In the majority of cases, if customers know you expect prompt payment as the norm, they will get into good habits from the outset.

  1. Over trading of the company

Whilst increasing turnover is important, it should not be to the detriment of cash flow. In many instances a business will chase turnover but if the business is incurring costs up front and payment is not received until a significant period after then the bigger the turnover gets then the bigger the cash flow deficit will become. Where possible try and get out of pocket expenses paid at the start of a project.

When growing a business you need to plan ahead and ensure you have access to cash flow boosting facilities such as a bank overdraft. Another good option is to use invoice discounting facilities, which allows you to draw down on revenues due to you in advance of being paid by the customer.

If you need to hold stock within your business then you make look to a stock finance facility which again can improve the cash position of the business whilst at the same time holding the stock.

  1. Buying capital equipment outright unnecessarily

It can be tempting to buy assets outright if you happen to have the funds available at the time. However, it is not always wise and may be more beneficial to use a funding facility such as hire purchase or bank loan. For instance, if you are looking to buy computer equipment for your business it can be a hefty one off outlay. Spreading the payments over 2-3 years will greatly assist the cash position of the company.

  1. Minimise expenses and overheads

Where possible, try and keep fixed overheads to a minimum. This then gives you flexibility as you grow and means you can adapt to a changing market. For example use outsourced services for HR, accounting etc. rather than having dedicated staff which is then a fixed cost you are committed to. Having costs which are of a more variable nature means you can dip in and out of them as you need them.

  1. Under-pricing for your products and services

When you first start out in business or in order to attract a client, it can be tempting to under price for a job or service. Short term, it might be helpful to secure some business but this creates problems in the longer term. For starters, it means your client will get used to paying less and it makes it harder to increase prices later on. It also devalues what you do, the client may be less likely to really appreciate the work because they see you as a ‘cheap supplier’, and it can create resentment in the long term.

It is far better to price yourself accurately and if the customer is unwilling to pay, walk away. If you quote a fair price it is probable they won’t get better elsewhere and are likely to realise this and return. And from a cash flow point of view, under-pricing means lower profits and the lower the levels of cash you will ultimately generate.

Cash flow is the lifeblood of a business but it is a balancing act. The trick to managing cash flow well is to take a multi-pronged approach and seek improvements to a range of different things. Work on the principle of marginal gains. Small improvements made consistently will result in a big improvement over time, and you won’t look back.

www.rjp.co.uk

Source: SME Web

How to effectively market your small business

By David Grimes, CEO of My Parcel Delivery

Developing a sound business plan and ensuring a successful product launch can be a time-consuming and, at times, daunting process. It takes a lot of hard work and determination but it’s seriously rewarding when everything comes to fruition.

Once up and running, you may feel a sense of relief, but the hard work has only just begun. All your meticulous prepping could go to waste unless you have a strong marketing strategy in place to support business growth.

The vast majority of new businesses struggle in the first year, and in order to survive you need to ensure that you are visible and in front of your target audience.

An effective marketing strategy will play a key role in attracting new customers, as well as keeping existing ones happy. But, for small businesses working with tighter budgets, the challenge is to keep spending down, so you’ll have to be savvy with promotional methods.

To give you a kick-start, here are my five top tips. These should prove useful for any small business owner looking to step up their marketing efforts.

1) Identifying a target audience and tone

As a starting point, identify exactly who your target audience is and how the products or services you’re offering are an attractive option. Are there any customer ‘pain points’ that you can tap into with your promotion? Addressing these will likely get people interested in the business. It’s also beneficial to research the competition to gauge how you can differentiate yourself from what is currently on the market. This prior planning will lay the foundations for a well-targeted marketing strategy.

Finding your unique selling point (USP) in a noisy and digitally-dominated business world requires some serious thought, but it’s certainly achievable. Think about the tone you’d like to take with your brand, and the language you’d prefer to use; will you be marketing yourself as a playful and fun brand, or take a more serious tone? Establishing these things beforehand will allow you to stay consistent with promotions across all platforms and marketing channels.

2) Building brand reputation

Getting your name out there no longer needs to be limited to the traditional methods of advertising via billboards or bus shelters (although these are useful). Social media has changed the game – particularly for businesses operating on smaller budgets. Platforms like Facebook and Instagram allow business owners to reach users worldwide, often with minimal expenditure.

Maximising the potential of these channels requires you to invest time into developing profiles and scheduling regular posts for each day. You could use a scheduling platform, such as Hootsuite, to do this for you automatically, and map out a week’s social media posts in advance. If your budget will stretch, you could also consider paying for social media advertising or targeted posts. These are relatively inexpensive ways of raising your profile and getting new eyes on the company page.

3) Designing an appealing website

Think of your website as your digital shop window. An impressive and well-designed website can be a big driver of sales; turning a casual browser into a paying customer. If the buyer has a smooth browsing experience, they will be less likely to leave your website in a hurry.

An online site needs to be attractive, easy to navigate and should take the user no more than a few clicks to reach checkout. So, try not to clutter it with too much information. Instead, opt for a clean design that draws attention to key products or promotions. Make sure any product information you do include is accurate, and that all related products are grouped together for ease of purchase.

4) Creating relevant content

One of the cornerstones to any good marketing strategy is content creation. Writing blogs or articles on topics that are relevant to your industry can establish you as a thought leader and go-to voice on a particular subject. But, as any good blogger would tell you, consistently uploading quality content is key. A content section needs to be updated regularly – the last thing you want is for a blog to go stale with old, outdated articles.

Tied into content marketing, is the impact it can have on your brand awareness online. Writing good quality content, which offers value to the reader, will make a difference to your search rankings over time. This should, in turn, increase the likelihood of them wanting to visit your site to find out more about you and – although not a direct result – ultimately encourage some form of purchase.

5) Using customer feedback wisely

Customer feedback is a powerful tool, as positive reviews can have a huge influence on sales. Encouraging those who have purchased from you previously to review their experience can build up your reputation as a trusted brand. To make the most of this feedback, you could choose to include a testimonials section on your website, or use a social media page as a place for interaction and comment.

Constructive use of critical feedback also involves direct communication with customers. If they have any queries, or raise any issues about your service, then be sure to answer these promptly. This is your chance to prove that you can handle criticism effectively, and use feedback to improve service in the future. Set yourself apart as a business that really cares about its customers.

While there’s no silver bullet to attracting new customers and driving sales, the marketing steps I’ve mentioned above should guide you in the right direction. Setting aside some time to map out your strategy will set you up for success now and in the future.

Source: SME News

YES Community Hub launches in Gauteng

DURBAN – The first Community Hub from the Youth Employment Service (YES) was launched yesterday.

The hub is an infrastructure solution that is targeted at addressing the unemployment challenges in South Africa.
The YES initiative which was launched by President Cyril Ramaphosa this year is a social impact initiative that will see government, business and labour work together to give one million youth one million opportunities over the next few years.
The launch is the first step towards the goal of establishing 100 Community Hubs across the country. The hubs will give rural areas and business communities business infrastructure.
The hubs are a part of the Development SMME Development Strategy from the YES initiative and house three focus areas.
The three focus areas are:
1. Business development
2. Route to market
3. Skills training
More than 60% of the unemployed people in South Africa are from the townships. Through the hubs small businesses will be able to use idle youth labour while starting up local economies and boosting domestic markets.
The hub is fitted with modern technology and staff that are skilled. The hub has been created as an inclusive and engaging platform through which both existing and aspiring businesses can enhance their business or ideas.
The Community Hub which is located in Tembisa has been made possible through investments from companies like Sanlam, Investec and Unilever.
The CEO of YES Tashmia Ismail-Saville said that the launch of the first hub is a visible demonstration brought to life, that is a true collaboration between government, corporates and the community.

YES and MTN

This past April, MTN announced that they will be creating 1000 jobs to support the YES initiative.
According to MTN, they will be creating the jobs across their South African business and Group head offices that will be both operational and functional roles.
Rob Shuter the MTN Group President and CEO said,”YES is an innovative social partnership that has the potential to be a significant catalyst for economic growth and development.”
Other companies have also joined the initiative including Absa, Sasol, Shoprite and Spar.

Source: IOL

Seed Capital: How It Can Help Your Small or Medium Business

Access to early stage development funding for up-and-coming businesses in South Africa remains a key hindrance standing in the way of entrepreneurial development.

There are, however, numerous strategies to finance your business’s launch, or early stage development. One of these tactics is to secure seed finance or seed capital investment.

Seed Capital: How It Can Help Your Small or Medium Business

The money you need to launch your business (or conduct any early stage development of a product or service) can come from a bank, an angel investor, or friends and family. But these money lenders can be tough to secure when you don’t really have a track record or much profitability to show yet.

This is where seed capital funding can help you.

According to Investopedia, seed funding lives up its namesake –  in that it’s the capital needed to ‘seed’ a business.

A portion of your seed funding could come from family members, friends, banks, or angel investors, but there are also a rising number of specialist firms out there that can provide you with specific capital or business finance to ‘seed’ your business.

The Difference Between Seed Capital and Venture Capital

The key thing to remember with seed funding is that investments usually range in the tens of thousands to hundreds of thousands. Other forms of investment, such as venture capital investments, can range into millions of rands. So, if you are an entrepreneur looking to fund a new idea with seed money, expect to receive smaller investments when compared to venture capital.

Sage Advice on Early Stage Funding from A Seed Funder

Geoff Ralston is a partner at YC, a seed funding organisation based in Mountain View, California, in the United States. More than two decades ago, he founded Four11, where he built RocketMail, one of the world-wide-web’s first web mail services.

In 1997, RocketMail became Yahoo Mail. Ralston has worked in engineering, then ran a business unit at Yahoo, and went on to become Chief Product Officer. After Yahoo, Ralston became CEO of Lala, which was acquired by Apple in 2009.

He says the ecosystem for seed (early) financing is far more complex now than it was even five years ago: “There are many new VC firms, sometimes called ‘super-angels’, or micro-VC’s, which explicitly target brand new, very early stage companies. There are also several traditional VCs that will invest in seed rounds.”

The Pros and Cons of Early Stage or Seed Funding for A Business

PROS: Seed funders can invest much needed capital and they can provide expertise and back-end assistance, which could be helpful in the early stages of business. If you are seed-funded, you also earn credibility in the marketplace should you wish to take a loan or seek further investment at a later stage. Ultimately, any seed funders you take on could open up proverbial doors to a vast network of like-minded entrepreneurs and future business partners or investors.

CONS: Seed funders require a return on investment, like any other investor. Some might be more focused on the money (returns) and could push you to take necessary steps to see a return on their investment – including ousting you from your own company, according to Under30CEO magazine.
A seed funder could potentially steer your business in a direction that you don’t agree with, but this could be because of their experience in the game.

If you are ready to take the step and talk to firms about seed funding for your company, here’s a list of organisations that can help you kickstart your business operations with early stage capital investment:

  1. 4Di Capital
  2. Technology Innovation Agency
  3. Cyril Ramaphosa Foundation
  4. Grovest
  5. Business Partners
  6. Seed Engine
  7. Edge Growth
  8. Kalon Venture Partners

Fashion incubator for fashionable entrepreneurs

DURBAN – Truworths and Startup Hatchery have collaborated on a fashion incubator called the Truworths Fashion Incubator and it will benefit aspiring and existing fashion entrepreneurs.

The Fashion Incubator will mainly focus on the developing the business skills of fashion entrepreneurs. The incubator was developed by Startup Hatchery to immerse designers and entrepreneurs in a community designed to equip and propel upcoming fashion businesses.
Startup Hatchery is a virtual business incubator for entrepreneurs and they provide a hands-on learning experience through online entrepreneurship, training, mentorship and business support that can be accessed anywhere and at any time.
The entrepreneurs that will be a part of the incubator will go through a 12-week structured online entrepreneurship training programme. After 12 weeks the entrepreneurs will then have the opportunity to pitch their businesses.
If they complete the pitching process they will move on to the second phase of the programme where they will be mentored by industry experts.
In terms of funding, he/she will receive R20 000 worth of Business Development Support if they complete a one-year programme. The entrepreneurs will also have the chance to pitch to investors for funding.
For membership into this exclusive programme individuals must meet the following criteria:
1. Applicants must have fashion business idea or an existing fashion that has not been in operation for more than 12 months.
2. Applicants must be in their final year of studies or completed their studies.
3. Applicants must submit the online form which will then be reviewed.
Applicants who have made it through will be notified in writing and will be invited to a pitching event at the end if the month.
Source: IOL

7 tactics you can implement right now to grow your startup

As a first-time founder or entrepreneur, knowing where to start when it comes to scaling your business can be extremely overwhelming. With an overabundance of resources telling you the right way to grow your startup, focusing on the wrong thing before having the basics down pat could spell disaster.

With the TNW Conference in Amsterdam fast approaching, we’re lucky enough to have experts behind the growth of some of the world’s most successful companies at our fingertips. To find out what really matters when it comes to growing your startup, we asked the experts scheduled to speak at the Growth Quarters stage at the conference one question:

What is one tactic first-time founders or entrepreneurs should adopt tomorrow to start driving business growth?

Here are their seven best pieces of advice:

1. You are the people you surround yourself with

“It’s all about the people you surround yourself with. At Techstars, we look for “team, team, team, market, traction, idea” when we’re choosing which companies to invest in. A successful startup journey will take 10 years — so, make sure that you’re accompanied by amazing people.”
Max Kelly, Managing DirectorTechstars

2. Measure what matters

“Data is meaningless if you don’t have a North Star and ask the right questions to drive impact. Measure what matters even if it means putting customer success over business success. There may be features that delight and build trust that are more important than building traffic. Beware of vanity metrics!”
Clarissa Shen, COO, Udacity

3. Prepare to go international from the start

“Think about international expansion from day one. If launching into several different markets is a necessity for your business to win, start planning for it from the start. Even though it might take you years from inception until you have the product market fit that you need to be comfortable to launch your first international markets, preparing for it from the beginning is key.”
Axel Bard Bringéus, International Expansion PartnerEQT Ventures

4. Put all your energy into one thing

“Focus. There are so many things you could be doing in the early stages of starting a company but time is your most precious resource. Find the one thing that will drive your company forward and focus all your energy on being incredible at that one thing.”
David Goldberg, Co-founder & CEOFounders Pledge

5. Do something small every single day

“Identify one small thing you can do today and make it happen. It could be reaching out to someone, learning something new or building on your product or service further. One small thing each day leads to progress and growth.”
Nicole Mills, Director Technology Talent Development, Booking.com

6. Make sure your business model is sustainable

“It’s important for a company — from day one — to integrate a sustainable economic model into its product. Many startups manage to be famous and to amass a significant number of users, however, only a few of them manage to be profitable.” 
Didier Rappaport, Founder & CEOHappn

7. Listen to your customers

“Listen. Learn from what you hear. Capture the insights so you can organize and categorize them. What customers say about their experiences is incredibly valuable.”
Adrian McDermott, President of ProductsZendesk

We interviewed experts behind the growth of some of the world’s most successful companies to give you a taste of what to expect at the Growth Quarters track at the TNW Conference this week, hosted byGoogle for Entrepreneurs and TQ

This article was originally published on TQ Stories.

 

Source: The Next Web

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