In what is a first for a Big Five professional services firm in SA, Deloitte & Touche and Datacentrix Holdings Ltd today launched the largest e-Business-specific, venture capital fund to date in South Africa.
With an initial facility of R150m over three years, this e-Business incubator and accelerator fund known as eCentrix aims to provide additional advantages to e-Business start-ups in the form of a broad range of professional services.
"The nature of e-Business ventures requires a different approach to private equity since entrepreneurs may have limited business resources and time-to-market is critical. We firmly believe that this alliance can offer e-Business companies a competitive edge, since we will be providing IT, venture capital and professional services expertise to ensure that these initiatives flourish. This is a unique combination in the SA market place," says Vassi Naidoo, Chief Executive of Deloitte & Touche SA.
Gerhard Uys, Managing Director of Datacentrix adds: "By creating this fund, we are allowing good e-Business ideas to be nurtured while ensuring that they do not distract us from focussing on our core business. Should any of the investments from the fund fit Datacentrix`s core business, we will bid for them on an open market basis."
Naidoo maintains that in spite of the move to the new economy, old economy fundamentals are still essential in the operation of a business and hence the fund aims to provide capital to e-Business specific opportunities that meet the old economy investment criteria.
"Entrepreneurs require more than capital and IT backing. By bringing our extended services including strategy consulting, capital raising, financial planning and support, tax, HR, legal, compliance and corporate governance to the table, an e-Business start-up has every opportunity to succeed. Moreover, the firm`s involvement in over 750 e-Business engagements from dot com start-ups to established global firms, including the implementation of Merrill Lynch`s global online trading strategy and the development of Charles Schwab`s e-Business strategy, ensure that we have a great pool of resources to draw from when it comes to providing e-business strategy and services."
"Deloitte & Touche is again taking a lead in terms of being the first Big 5 firm to set up such a fund. The establishment of this fund is part of a global initiative by Deloitte & Touche, which has seen similar funds set up in Australia (known as ePark) and the USA," says Naidoo.
Commenting on the alliance between the two firms, Uys says "Partnering is the cornerstone of the Datacentrix philosophy of creating shareholder value through partnerships with those with core expertise in particular areas. Deloitte & Touche has the e-Business experience and intellectual capital to make start-ups succeed."
As part of the deal, Deloitte & Touche will be transferring their existing e-Business investments, such as FruitOnline, to eCentrix.
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