Venture Capital

Objective

The main objective of the Venture Capital SBU is to facilitate the development and commercialization
of technology-rich South African Intellectual Property
that is unique from a global perspective
(uniqueness must be in the product being developed, not in the business model)

Investment Mandate

The IDC’s Venture Capital SBU provides equity funding
of between R1m and R30m per project (maximum first round funding of R15m with the right, but not obligation, to provide follow-on funding up to maximum of R30m)
for a significant minority equity stake (between 25% and 50%)
to entrepreneurs / SMEs in their seed and start-up (pre-revenue) stages
for the development & commercialization
of globally unique technology-rich products
aimed at high margin, high growth market segments

Investment Criteria

Intellectual Property (IP) must be owned by the company that we invest in
- We do not fund commercialization of technologies that are licensed in
Development of IP must be done in-house,
- We will consider situations where IP has been acquired and then further developed in-house.
IP should preferably be patentable,
- If not patentable, should provide some form of sustainable competitive advantage
Management teams must include people with all the required key competencies
- If all competencies are not on board then clear plans need to be in place to bring them on board at the appropriate time
Key founding shareholders should be involved in the business on a full-time basis
Business should display good prospects of being economically viable

Nature & terms of funding

Funding is in the form of equity (ordinary shares and shareholder loans).
No defined investment period
Prospect of exit opportunities within a reasonable time-frame should exist
Will exit investment when we believe we can realize a return in excess of a 30% real after tax IRR
We require the right to exit to a mutually agreed upon BEE party
Equity stake will entitle us to proportional board representation
We also require the right to attend monthly management meetings with the view to providing strategic support, guidance and advice where necessary

How to apply for finance

Click here for more information on the application process and funding criteria.

Who to contact

For more information on the Venture Capital Strategic Business Unit, please click here to contact us or call us on 086 069 3888 or + 2711 269 3731 . Alternatively, email our call centre at callcentre@idc.co.za