Johannesburg, 5 October 2023 – Sanari Capital, a women-led and majority Black- and women-owned South African private equity firm, has successfully raised R1.25 billion (about $65 million) for its growth fund. The fund is poised to play a pivotal role in fuelling employment opportunities and fostering economic growth in South Africa and across the African continent.
Completing the second closing for the Sanari 3S Growth Fund brings the firm closer to its goal of securing a final close equivalent of up to $100 million.
Financial powerhouses join the investor base
New investors in this closing include the Public Investment Corporation (PIC), the largest asset manager on the African continent, and Alexforbes Investments, South Africa’s leading and largest provider of multi-manager investment portfolios and related investment services in Southern Africa, with R450 billion in assets under management and administration. The PIC manages capital for the Government Employees Pension Fund (GEPF), which is the largest pension fund in Africa.
Sanari Capital’s founder and CEO, Samantha Pokroy, says: “We are delighted to have raised capital from such highly regarded financial institutions, both of which share our commitment to achieving a balance between financial and socio-economic benefits. This funding will play a pivotal role in addressing structural economic imbalances, promoting transformation, fostering economic growth, creating jobs, and delivering both environmental and financial returns.”
The addition of PIC and Alexforbes complements Sanari Capital’s existing investor base, which includes the 27four Black Business Growth Fund, Telkom Retirement Fund and the Motor Industry Retirement Funds through the RisCura Manager Development Programme, and National Fund for Municipal Workers (NFMW). Pokroy adds, “We are grateful for our investors’ continued support and the additional top-up allocation provided by NFMW, which underscores their confidence in our portfolio and pipeline.”
Transformative potential unleashed
Moushmi Patel, co-founder, Partner and Investment Director at Sanari, highlights the transformative power of this fund, stating, “This fund equips us with the financial muscle to invest in larger businesses than before, extending the reach of our investment strategy focused on founder-run, owner-managed and family-owned businesses across the mid-market segment. Furthermore, it enables us to support our investee companies throughout their expansion and scaling journey. For instance, we anticipate continuing our support for Edulife Group, an affordable quality independent schools group in South Africa, where we’ve already expanded the learner base from 1,000 to 3,000 students, with a pipeline to double the business in the near term.”
Investing in the future of South Africa and Africa
Sanari Capital invests between R50 million and R250 million in well-established businesses at an inflection point and poised for growth through technology, innovation, thematic drivers, and entry into new markets. Ofentse Pelle, Partner and Investment Director, emphasised, “We prioritise digital and human enablement to unlock business potential and focus on sectors with growth prospects de-linked from local economic growth, all while steadfastly supporting local employers.”
Aligned with the dynamic global landscape, Sanari’s investment philosophy emphasises themes such as technology, a more interconnected digital world, IoT, data, and services. Furthermore, in line with the rising global consciousness of social responsibility, Sanari strategically invests in sectors vital to human well-being, including education, healthcare, food security, and eco-friendly solutions. Sihle Gumede, Partner and Investment Director, states, “We encourage our businesses to broaden their horizons, fostering a ‘local to regional, Africa to the world’ perspective.”
Promoting diversity and responsibility
The capital invested by the fund qualifies as 100% black ownership in underlying portfolio companies, offering benefits over and above the firm’s growth capital and value-adding support. Samantha Watermeyer, Partner and Operations Director, says, “This aligns seamlessly with Sanari Capital’s commitment to diversity and its role as a relevant player in both the African and global markets.” Additionally, the fund aligns with the criteria for the 2X Challenge, a global initiative mobilising resources to advance women’s participation in international economic development and leadership.
Championing a prosperous and inclusive future
Sanari Capital’s latest funding success represents a significant stride towards enhancing employment opportunities and catalysing economic growth in South Africa and across the African continent. As the fund embarks on the next phase of its journey, it promises to reshape the business landscape and contribute to a more prosperous and inclusive future for all.