Secha Capital
Investing in African companies

Investment Criteria

What Secha Capital looks for to invest in SMEs

  • Ideal tick size: R1-10M

  • Typical % ownership: 10-30%

  • Sectors of interest: Agri, FMCG, business-enabling services

  • Investment theme: Niche, growth verticals; large, dormant markets that can be re-invigorated 

  • Minimum revenue: R5-50M revenue with positive gross margins

High Level

At Secha, we look for established South African SMEs (R5-R50M annual revenue, 5 to 75 employees) in the agribusiness and FMCG space that need both growth capital (~R2M - R10M) and management support to grow and reach full potential. We invest and provide support as equity partners to the SMEs.

We like large, fragmented, often "boring" sectors. These are often niche growth verticals adjacent to larger markets (e.g. our natural hair nativechild investment) or large, dormant markets that can be reinvigorated (e.g. our Stoffelberg Biltong investment).  This usually means 1) the SME has a proven business model and clear impact mission and 2) Secha can invest at an inflection point where growth capital can fuel revenue and profitability growth. 

Other Attributes

  • Founder-run, reliable team

  • Simple revenue model, stress margin over revenue

  • Expandable market not at risk of changes in imports/exports or government intervention

  • Ruthless focus on distribution

  • Segmented / prioritised, multi-tier sales channels

  • Clear product advantage: e.g. localised, bundled, an enabling service, it cultivates a customer peer group

  • High frequency use case designed to increase incremental purchases

  • Strong scale cost advantage with a reliable supply chain (low capital intensity)

  • Salient brand in both modern and traditional trade

The most concise way to describe what we do at Secha Capital: We provide patient capital to established African SMEs in the "missing middle"; address the management gap by joining the management team; reach full potential via our accelerator toolkit.