New private fund-raising platform for firms introduced
Enacy Mapakame, Harare Bureau
THE Financial Securities Exchange Limited (FINSEC) is introducing the FINSEC Private Markets, a private funding marketplace catering for businesses at every stage of its development.
This follows overwhelming demand for private debt and private equity funding on the GEM (Growth Enterprise Market) Portal, which was launched in 2019.
Despite the increase in demand for funding on the GEM Portal, designed to assist Small enterprises to raise capital, it emerged some of the applicants preferred not to immediately go public by listing, and instead opt to be privately funded while undergoing incubation ahead of eventual listing.
“In response to this demand for private debt and private equity funding, FINSEC is introducing the FINSEC Private Markets, an innovation tailor-made for the demands of growth enterprises and emerging local brands,” said FINSEC general manager Garikayi Munema in a statement.
“FINSEC Private Markets is a unit wholly owned and operated by the exchange and is a private funding marketplace for businesses at every stage of development including those in start-up; growth, maturity, and declining phases.
“The platform provides enterprises with value discovery; exit options; pre-IPO (initial public offering); IPO and listing pathways.
“FINSEC Private Markets is available to qualified institutional investors (QII); high networth individuals (HNIs), Development Finance Institutions (DFIs); and local or international private investors looking for alternative investment opportunities with growth potential,” he said.
FINSEC launched the GEM Portal in 2019, an online digital platform connecting the demand and supply side of capital through securities exchange infrastructure.
According to FINSEC, the GEM Portal received a lot of support from financiers and potential investors including the United National Capital Development Fund (UNCDF) who provided financial and technical support to set up the platform and in carrying out preliminary research into the demand for capital by growth enterprises.
To-date more than one-hundred and fifty applications have been received through the GEM Portal. One commercial bank, seven financial advisory firms and four institutional investors have registered as participants.
Now the introduction of the FINSEC Private Markets is the panacea for enterprises seeking patient capital.
“On the other end, investors enjoy access to screened and de-risked investment opportunities utilising exchange infrastructure.
“The FINSEC Private Markets will also bring together and avail expertise in the capital raising and investments value chain. These include, financial advisors, investment analysts, and legal advisors to provide support to capital raising by enterprises,” said Mr Munema.