ZIMELE Presentation to: SME s and Technology Transfer Alugumi Dzebu Senior Investment Manager: Partnership Funds 20 May 2015
PRESENTATION OUTLINE Background on Zimele Funds Performance Hub network Competitive advantage Partnership projects Sebenza Fund Godisa Supplier Development Fund Lessons learnt from Partnership Projects Conclusion 2
FUNDS (PRODUCTS AND SERVICES) Anglo Operations Funds ZIMELE Partnership Funds Supply Chain Fund (1989) Community Fund (2008) Green Fund (2011) Anglo American Sefa Mining Fund (2003) Sebenza Fund (2013) Godisa Supplier Development Fund (2014) Supply chain investments Entrepreneurs around Anglo American s mines, labour sending and poverty nodes Environmentally sustainable projects/ enterprises Junior scale mining JV with gov. entity Jobs focused JV with gov. (Jobs Fund) ED/SD in Transnet JV with gov. entity Support (Corporate Governance) Minority equity and/or loans Support (Mentorship) Loans Support (Mentorship) Minority equity and /or loans Support (Corporate Governance) Minority equity and/or loans Support (Mentorship) Minority equity and/or loans Support (Mentorship) Minority equity and/or loans Max R5m/deal Max R2m/deal Max R10m/deal Max R30m/deal Flexible Max R5m/deal Loans @ Prime % p.a. Loans @ 6% p.a. Loans @ Prime % p.a. Loans @ Prime % p.a. Loans @ 6% p.a. Loans @ Prime % p.a. Fund size: R200m Fund size: R500m Fund size: R100m Fund size: R200m Fund size: R500m Fund size: R165m (12%) (30%) (6%) (12%) (30%) (10%) Total fund size - R1.7b 3
ZIMELE - PERFORMANCE 2008 to December 2014 Number of transactions 2,765 Total People employed 38,296 Turnover Rm 6,094 Funding - Rm 1,359 Female entrepreneurs supported 42% Youth supported 38% Companies 1885 Repeat transactions with the same companies Total 2,765 Cost per job - R 35,487 881 4
ANGLO AMERICAN HUBS Kumba Iron Ore Anglo Platinum Thermal Coal De Beers Corporate Centre Hitachi Kathu Western Kumba Iron Limb Ore Eastern Limb emalahleni Kimberley J'burg Lephalale Kuruman Rustenburg Mining Mokopane Middelburg Voorspoed (Kroonstad) Philippi Kusile Postmasburg Rustenburg Process Atok Secunda Elementsix (Springs) Petra Diamonds Saldanha Bay Thabazimbi Burgersfort Vaal Venetia (Musina) Daniëlskuil Bushbuckridge Kleinzee Cullinan Phola (Ogies) Debmarine (Cape Town) Koffiefontein Existing Hubs 28 Proposed/approved new hubs - 2 Dennilton 5
ANGLO AMERICAN / PARTNERSHIP HUBS Northern and Western Cape Eastern Cape North West KwaZulu- Natal Limpopo Gauteng Mpumalanga and Free State Cape Town CBD Mthatha Kumba Iron Ore Vryburg/ Taung Durban Lephalale Ekurhuleni Mbombela George Queenstown Kokstad Tzaneen Mogale City Mangaung Dingleton King Williams Town Newcastle Johannesburg Upington Nelson Mandela Bay Pretoria Existing Hubs 15 Proposed/Approved New Hubs - 5 6
ZIMELE S COMPETITIVE EDGE 26 years of enterprise development with strong links to Anglo American s Supply Chain Strong public/private partnerships Extensive hub network extending to poverty and mining labour-sending areas Developmental pricing Post-investment management and extensive non-financial support Quick turn-around time One of a few institutions that has a Fund dedicated to early stage mining Emphasis on start-ups with a large proportion of SMEs funded being early stage start-up ventures, and Strong focus on female entrepreneurs 42% of businesses funded since 2008 are female-led 7
SHANDUKA BLACK UMBRELLAS SEBENZA FUND Sebenza Fund multi-purpose business hub partnership at Lephalale with Shanduka Black Umbrellas, including Hitachi 118 new permanent jobs created to date with 21 SMEs 3 year contract with Exxaro for supplier development of 30 SMEs SME businesses funded: sanitation services, property consulting, general consulting, material and maintenance, transportation, oil filtration, etc. 8
AURIK BUSINESS INCUBATOR SEBENZA FUND Sebenza Fund partnership with Aurik Business Incubator and Anglo American Supply Chain to develop 6 start-up SMEs and 22 existing early stage SMEs 147 new permanent jobs created to date 18 month development programme which includes marketing to Anglo American Supply Chain SME businesses: energy solutions, prop shafts, building supplies, lubricants, electrical solutions, biofuels, financial services, mining supplies, plant maintenance, wireless connections, healthcare, transportation, etc. 9
TECHNOSERVE SEBENZA FUND Focus on agriculture a strategic area due its labour intensity and broadbased Community Trust structures Sebenza Fund partnership with Technoserve for technical skills transfer and project management Currently implementing 2 projects in the Eastern Cape: Livestock and wool production (27 new jobs) Massmart offtake Maize and bean production (400 new jobs) Massmart and Farmwise Grains offtake 10
GODISA SUPPLIER DEVELOPMENT FUND Partnership between Zimele, sefa and Transnet Aims to nurture black-owned SME s that are Transnet s current and potential suppliers To create sustainable enterprises through financial and non-financial assistance Contribute towards government s job creation and BEE programmes and initiatives Enable Transnet suppliers to consistently meet their contractual obligations and grow their businesses sustainably 11
GODISA SUPPLIER DEVELOPMENT FUND CONT.. Business loans at prime linked rate Equity financing for Empowerment deals Average funding size of up to R5 million per transaction Business development support based on the needs of the business, including mentorship and training 12
LESSONS LEARNT FROM PARTNERSHIP PROJECTS Breaking SMEs high barriers to entry for market access difficult to achieve in the SA context Jointly addressing challenges faced by SMEs in understanding market dynamics, business principles, capacity building, training and skills development Synergies created by combining partners strength and efforts for the benefit of SMEs, providing a holistic approach to SME development Pooling of resources achieving results quicker and better 13
CONCLUSION Access to markets remains a key problem as most start-ups do not always have firm contracts to secure long term commitments Job creation in SMEs occurs over a period of time Synergies created by combining partners strength and efforts for the benefit of SMEs, providing a holistic approach to SME development Entrepreneur selection and profile is a critical element in determining the correct fit and success of the business 14
Thank you www.angloamerican.co.za zimele@angloamerican.co.za 0860 ZIMELE 15