SPONSORED | Kisby Fund chairman Mark Barnes mark_barnes56 explains how he plans to help SA’s SMEs secure the funding they need to kick-start their contribution to the economy:
The Covid-19 lockdown has had a catastrophic impact on SA’s small to medium-sized enterprises . Businesses are desperately trying to stay afloat under restrictive conditions or have lost their revenue entirely. As many as 75% of SMEs could be pushed to permanent closure by the end of the lockdown, with a projected 500,000 jobs lost.
“An unemployed person is a liability who has to be supported by the state. If we are to address economic issues on the ground, we need to go into the lifeblood of the economy and move away from established mature capital markets and into SMEs.” Using fintech to assess the growth stage of a business, Kisby tailors a mixture of equity and debt instruments to offer appropriate and affordable funding for that business.Crippling credit Emery said there had been a significant shift in SME funding, as investors realised they needed to take institutional capital from companies “in the Sandton Towers”.
“Perhaps the business owner has factored a 20% margin on the invoice but now has to sacrifice 6% of his profit,” said Emery. “Over 12 months, that’s an average of 36%. No SME should ever be that desperate to sacrifice so much of its profitability for short-term financing.”
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