South African fintech and alternative funding provider, Sourcefin, has successfully secured ZAR150 million (approximately US$8.2 million) in funding from Futuregrowth Asset Management. This significant investment will bolster Sourcefin’s mission to provide essential financial access and specialized supply chain support to small and medium-sized enterprises (SMMEs).
Established in 2020, Sourcefin has positioned itself as a crucial enabler for often-overlooked SMMEs. The company addresses the critical gap in financing for these enterprises, empowering them to overcome working capital challenges and effectively fulfill both public and private sector purchase orders.
The ZAR150 million investment comes from Futuregrowth’s High Growth Developmental Equity Fund (HGDEF). This fund is dedicated to supporting high-growth businesses, and its investment in Sourcefin aligns with its strategy of backing promising enterprises. Other notable companies supported by HGDEF include hearX, Yoco, Pineapple, Retail Capital, Ozow, and Cash Connect.
Joshua Kadish, Co-Founder, Director, and CEO of Sourcefin, emphasized the impact of this investment, stating;
There is no doubt about the massive impact that well-supported SMMEs can have on our country. With the support from Futuregrowth, Sourcefin’s ability to scale investment into the SMME sector significantly increases, and it is our commitment that all R150 million will be deployed as a reinvestment into the backbone of our economy.
Amrish Narrandes, head of private equity and venture capital at Futuregrowth, highlighted the importance of the SMME sector for South Africa’s economic growth;
The SMME sector is vital for South Africa’s economic growth, yet traditional financing solutions often fail to meet their unique needs, particularly in government-issued orders. Sourcefin’s technology-first approach, coupled with their expertise in procurement and project management, has created a truly transformative solution. Their proven ability to support tender fulfillment while maintaining strong financial performance made this a compelling investment opportunity.
This strategic partnership between Sourcefin and Futuregrowth is poised to significantly enhance the financial landscape for SMMEs in South Africa, driving economic growth and fostering innovation within the sector.
