Yesterday, South Africans celebrated #YouthDay. During this special day, Vusi Thembekwayo who is an investor, author, business speaker, and global entrepreneur hosted “How to access funding, what every Entrepreneur should know” masterclass in Sandton, Johannesburg. This masterclass was conducted in an unorthodox manner, with the majority of the attendees being young entrepreneurs in need of new knowledge on what investors want, seeking funds for their businesses, as well as gaining techniques of assessing business ideas. Based on statistics from Stats SA, the unemployment rate among the South African Youth is at 26.7%, and the youth population is discouraged by the labor market. As a result, they are left with the entrepreneurship option, which is the main economic driving force in development and job creation across the country.
However, key challenges are facing South African entrepreneurs; the main one being lack of access to funding. In the masterclass, Thembekwayo emphasized that a business is supposed to solve problems and it is essential to back up every business information with researched facts instead of assumptions and suppositions. Therefore, in this masterclass, new entrepreneurs had the chance to discuss their business ideas as the businesses in growth phase were given direction on developing their plans further. In this symposium, business ideas were assessed in real time hence ascertaining their viability in the current market and economy.
From investors’ perspective in South Africa, private equity has a partiality towards similar types of business, which come from a select few investors. Consequently, venture funding has not flourished across South Africa considering that only 2% of the GDP originates from venture capital investments. Thembekwayo emphasized that investors look for due diligence as they tend to fund business with cash flow attached to it. Additionally, it is crucial for entrepreneurs to learn how to access funding as it is a pivotal skill for their prosperity.