A new private equity partnership has been launched to focus on the technology, media and telecommunications (TMT) sectors.
Treacle Venture Partners was established by Christoff Botha (formerly head of private equity at Gensec Bank), Konrad Fleischhauer (formerly at Archway Venture Partners), and Rudolf Pretorius (previously a director of Rand Merchant Bank and who launched Origin, the private client banking arm of First Rand).
It will provide equity capital, strategic marketing input, general business guidance and financial and structuring advice to inventors of new technologies, entrepreneurs needing capital to establish a new business, and entrepreneurs and management teams needing capital to grow emerging businesses in the IT, media and telecommunications industries.
The firm`s first fund, Treacle 1, has attracted funding of R245 million, with R100 million each invested by Nedcor Limited and Nedcor Investment Bank. Other investors are Hannover Re (R15 million), Primedia (R15 million), management (R8 million) and Decillion (R7 million).
Treacle says it will invest in TMT businesses which use technology to improve businesses` functionality rather than in "blue-sky" futuristic technological developments.
"At Treacle we believe that in industry, as in sport, there are those who are extremely successful and those who remain average," says Botha. "The winners are those who have identified and understand the `sweet spot` in their industry, and make use of it consistently.
"We believe that those entrepreneurs who are going to be extremely successful are the same ones who grasp the specific intricacies and nuances - the sweet spots - of their particular industry better than anyone else, hence the name `Treacle`.
"We will provide capital only to those entrepreneurs who have the ability to hit the sweet spot, more consistently and regularly than their competitors."
Fleischhauer says management and the investors are not put off by the "tech wreck" of the past 18 months.
"While we are looking to invest in businesses in the TMT sectors, we are also going to be discerning as to precisely where we invest. We will concentrate in areas such as electronic and interactive commerce, interactive media and interactive technologies.
"We are prepared to invest at any stage of a business`s lifecycle - from start up to expansion provided the business has a solid revenue model. We are seeking out entrepreneurs who have vision and potential, and whom we can nurture to become champions."
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