South African investment firm WDB Investment Holdings (WDB), owned and run by women for women, has acquired a 30% shareholding in ICT accelerators Seed Engine, which equips entrepreneurs with the skills they need to create, grow and build their businesses. By Staff Writer
WDB is keen to increase its shareholding in the business to a controlling 51% in the future.
“Our investment is likely to increase to 51% and as a women’s company, we have an appropriate bias towards empowering female entrepreneurs and being a meaningful active investor. The partnership serves both the business and social agenda of WDB.” Faith Khanyile, CEO of WDB, said in a statement.
“We liked Seed Engine’s emphasis on black women and youth-owned businesses. We were impressed that their programmes have trained 600 entrepreneurs, created and supported 300 enterprises and an average of three jobs per enterprise. Seed Engine has touch points at every step of the way of the business life-cycle from startup through to sustainable SMEs and successful suppliers.”
She added that the WDB’s 25-year track record is aligned with the future vision of Seed Engine.
Meanwhile Grovest – a South African venture capital company, also bought a 27,5% stake in Seed Engine, which incorporates Seed Academy.
Both WDB and Grovest didn’t disclose the amount they paid for the 57.5 stake in Seed Engine.
Jeff Miller, CEO of Grovest, said that his organisation brings an in-depth understanding of the entrepreneur and venture capital ecosystems, a solid track record of successful investments and over 100 years combined management experience in capital raising, listings, MBOs and trade sales.
Seed Academy turned three on July 1 and has been focusing on transforming the South African economy through entrepreneurship.
Faith Khanyile, CEO of WDB, said in a statement that its investment brings together a common concern that these organisations are working to address, the transformation of South Africa’s economy by developing sustainable entrepreneurial businesses.
“We needed a strategic partner that would instantly allow us to scale up our efforts around entrepreneurship in SA, especially amongst women. Seed Engine was one of the first ICT accelerators in this country, and this dynamic for-profit social enterprise is now supporting the entire entrepreneurial ecosystem from startup through to supplier.”
Seed Academy was founded in Johannesburg in 2013 with a core offering of training and business development for startup entrepreneurs. Its offering has expanded to include impactful interventions for each stage of an entrepreneur’s development, thereby addressing the needs of socio-economic, skills development, enterprise and supplier development programmes. Its Cape Town office opened in January 2015, and a KwaZulu-Natal office will be opening soon.
Donna Rachelson, CEO of Seed Engine and Seed Academy, said entrepreneurs are the job creators of the future and these investments have created strategic partnerships that will amplify our training, support and funding mechanisms at every stage of the entrepreneurial lifecycle.
“The BEE deals of the past are no longer relevant. We want to create genuine mechanisms to expand SA’s ‘missing middle’. A key focus of our work is to make sure that startups progress steadily into enterprises and become registered vendors that provide reliable products and services to the supply chains of public and private South African companies.”
Rachelson added that Seed Engine was impressed that some 180 000 rural women had benefited from WDB Trust loans worth more than R400-million, 3000 women had received literacy and basic business skills training, and over 300 permanent jobs had been created by the WDB Group since inception.
“Many people in South Africa were not raised in an entrepreneurial environment in which they were encouraged to take an idea and grow a business,” says Khanyile. “More than ever before, there is an urgency for young South Africans and female entrepreneurs in particular to be assisted in taking their ideas forward and build businesses. Our young people need jobs, and we need to help them create jobs for themselves, their families, and their communities.”