HOW TO BIG LEAGUES

Finweek English Edition - - COVER STORY - THE IDC VEN­TURE

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.

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