HOW TO BIG LEAGUES
Capital SBU is always on the lookout for exciting new products and business ventures. While the company is always open to new ideas, Fourie advises applicants to familiarise themselves with the SBU’s investment mandate and criteria before attempting an application.
“The first step is to understand who you’re approaching. When you’re speaking to an investor [like the IDC Venture Capital SBU], you have to understand that the investor wants to know how the investment will make him or her money. The IDC has a pre-investment centre that can help you draw up a business plan and will even go as far as appointing business support consultants for that purpose,” he says.
“When you do finally submit a business plan, don’t submit a novel,” he says. “You have to be able to convince me to invest in your business in 10 pages or less. A good executive summary of two pages is even better. Remember, we read hundreds of business plans a year. You have to be able to describe your technology, the need for your technology in the market, how you’ll make your money and the team you have at your disposal succinctly.”
De Beer agrees and adds that entrepreneurs often get so excited by their idea that they don’t stop to think why anyone would want to buy the product. “Sometimes the idea is brilliant, but nobody wants it. You have to be able to differentiate between the two,” he advises.
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The IDC Venture Capital SBU can invest anything between R1m and R40m in the final development and commercialisation of globally unique technologies of South African origin. The SBU prefers to remain a significant minority shareholder of between 26% and 49%, although it is a majority shareholder in three companies that required major intervention – Lodox among them.