GroFin, a multi-national specialist SME finance and development-company, has joined forces with CDC, UK's development finance institution, and the Shell Foundation to highlight the potential of 'growth finance' to become a multi-billion dollar industry within the next decade. The growth finance sector provides access to capital and business development support for small and medium size enterprises (SMEs) in developing countries.
At a recent briefing held at the Cass Business School in London, industry experts met to discuss the challenges of attracting investors into the growth finance sector. Growth finance provides much needed support to SMEs who are unable to attract capital because they are too big for microfinance and too small for commercial banks and private equity. In attempting to plug this gap, growth finance provides SMEs with access to risk finance, typically involving sums of between $100 000 and $1million, as well as business development support. This approach encourages sustainable economic growth and job creation.
Richard Laing, Chief Executive: CDC, said:
“The growth finance sector has huge, untapped potential. In the coming decade its impact could be bigger than that of microfinance. 106 million of the world's poorest families received a microloan in 2007 – growth finance has the potential to reach many, many more.”
Chris West, Director of the Shell Foundation, said:
“The Shell Foundation and GroFin act as venture capitalists in the development space. The problem is not a shortage of entrepreneurs in Africa; it has been to give these people the necessary investment and support to help their business grow. We provide a return on investment by helping SMEs to succeed using an enterprise-based approach. Growth finance has massive potential”
GroFin, established in 2003, assists SMEs in Africa achieve sustainable profitability, and they believe that growth in this sector is vital for socio-economic development in emerging markets. They support SMEs that are entrepreneurial in spirit that wish to start and grow a viable business and require access to risk finance. Operating in 8 countries, they have provided finance totalling U$52,238m to 146 businesses and assisted in developing the entrepreneurs' business skills and knowledge. This has led to 2 603 jobs being maintained and the creation of a further 1 732 jobs. They currently have assets of $250m under management.
Managing Director of GroFin, Jurie Willemse, said:
“The growth finance industry holds the promise of developing into a thriving and powerful global industry that provides relevant financial services to SMEs on a sustainable basis. Through our partnerships, with the likes of CDC and Shell Foundation, GroFin remains committed to growing the SME finance sector and contributing to economic growth and social development, and assisting SMEs in maximising their profit, creating job opportunities and sustaining wealth”
For further information please contact:
Kirk Ridgway, Marketing Manager: Tel: +27 (12) 998 8280
Matthew Boadu Adjei, General Manager, GroFin Ghana: Tel: +233 21 774 777
Rhyddid Carter, Communications Manager: Tel: +44 (0)207 9634741
Enda Joyce or Emily Lacey: Tel: +44 (0)20 7400 4480