Vunani Capital has bought a majority stake in Jala Group, in its bid to create an investment holding company with stakes in about 30 smaller ICT firms.
Vunani bought a 51% stake in the ICT-focused investment firm for an undisclosed amount. Management will retain the balance of the holding in Jala.
The merged entity will be re-named Vunani Technology Ventures and is a platform for investments into technology companies. It will offer ICT advisory and investment banking to high-growth, mid-market ICT software entrepreneurs.
Jala was established by JB Maree and Graeme McKellar to aid entrepreneurs in the IT market. It works with entrepreneurs and business owners in the mid-sized software market, which typically have revenue of between R20 million and R100 million.
Vunani is a black-owned and managed diversified financial services company that operates through its financial services and investments services divisions. It was formed through a management buyout from African Harvest in 2004, and was listed on the JSE's AltX exchange in 2007.
Investment boost
Vunani Technology Ventures CEO JB Maree says the new company will blend an understanding of the ICT market with a corporate finance model to invest into mid-market ICT organisations.
network of relationships in key growth areas such as the private sector.
Maree says the “ICT sector is often viewed as something of an enigma, yet it is one of the key drivers of development in Africa. For IT entrepreneurs, their relationship with investment bankers and corporate advisors can be fraught with misunderstanding.”
Vunani Technology Ventures aims to bridge the gap, providing niche IT specialist knowledge with investment experience and savvy. “Our vision is to become a supportive growth force for entrepreneurship and IT business in SA,” says Maree.
Vunani Technology Ventures will focus on those mid-market software entrepreneurs who demonstrate the potential to become major players in the ICT industry. It says it will provide them with the necessary high-impact advice to facilitate the next level of growth.
Big plans
In the next few years, the venture company will focus on establishing a track record and bolstering its client list and projects. Maree says, in the next five to seven years, it wants to have funds under management that it can use to move up the value chain as it will be a larger company.
Vunani Technology Ventures' focus is to aid companies that focus on mobile applications and solutions on the continent, says Maree.
It will not only provide cash in return for an equity stake, but also business assistance, he adds. “Innovation doesn't always just need capital.”
In seven years' time, it aims to have investments in 20 to 30 mid-size ICT firms, notes Maree.
“The mid-sized software market is particularly interesting with its challenges in terms of expansion and empowerment,” says Vunani CEO Ethan Dube. “As an innovative platform, Vunani Technology Ventures will create linkages providing the impetus for expansion and growth.”
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