The State of the Nation Address cemented the importance of small to medium-sized enterprises (SMEs) in South Africa’s economic recovery. In order to survive, SMEs need a combination of both funding and the right skills and talent to help them adapt post-pandemic. Yet many top-performing graduates are snapped up by large corporates or move overseas, resulting in SMEs being unable to tap into the talent pool required to grow their business.
“With the current economic climate and high youth unemployment rates, the best and brightest graduates often leave South Africa to work for international companies. In doing so, our local ecosystem loses out on this talent,” says Yusuf Shaikh, Operator-Investor at Secha Capital, an early-stage private equity fund. “In order to ensure that we are able to retain the talent that SMEs need to grow, investments need to extend to skills transfer for management as well.”
In a step to create jobs for unemployed graduates and help SMEs find the talent they require to increase profits, Secha Capital has launched its Junior Operator-Investor Network (JOIN), which aims to onboard fifty young people within the next year. Each junior operator-investor will learn the skills needed to run a business, as well as be introduced to the impact investing space through mentorship and guidance from its team.
“The most effective way to gain experience is by learning new skills on the job,” says Shaikh. “By joining an SME as a member of the team, you are able to gain insight into how the business works, grow with the company and learn valuable new skills through problem solving.”
The network does not just offer opportunities for graduates, but SMEs as well. In 2020, a third of small businesses stated that they were being left behind due to the latest developments in technology. “Young people bring a fresh perspective and creative ideas, which can help small businesses expand and adopt new digital solutions to innovate and increase profits,” says Shaikh.
With a focus on providing patient capital to established SMEs in the “missing middle”, Secha Capital’s model is unique to the private equity and impact investing space in Africa. Through joining the SME team, they aim to address the management gap and help the business reach their full potential through a twelve-month accelerator toolkit. Their newest investments include Cultura Fresh, a hydroponic vegetable producer, and iG3N, an innovative energy solutions provider.
For more information, visit their website www.sechacapital.com.