USD 37.4 Mn Investment Announced For South African SMEs

By  |  February 6, 2019

Silicon Valley-based techprenuer Vinny Lingham’s Newtown Partners and Lion Pride investment holdings have made known their plans to raise USD 37.4Mn for a co-managed Section 12J technology investment fund.

Vinny Lingham and Llew Claasen, the co-founders of Newton Partners revealed that the funds will be invested in emerging technologies.

Lion Pride Investment holdings CEO, Deven Govender expounded that the fund uses the section 12J tax incentive to enable investors to use their investment as a taxable deduction against other income.

The LionPride Agility VCC Fund is a single technology fund with a choice of two share classes providing the opportunity for a compelling risk-weighted return,” said Govender.

SMEs that fall within fintech, agri-tech, on-demand services, business process outsourcing, renewables, healthcare, 4IR and ed-Ttch will be the focus of the LionPride Agility VCC Fund.

The Lion Pride CEO further explains that the structure makes it possible for venture capitalists to invest in one of two capital pools co-managed by LionPride and Newtown Partners at the same time gain balanced exposure to early-stage South African technology businesses or concentrated exposure into a selected theme according to their desired risk allocation.

“We believe that we’re taking a bold approach that will catapult economic transformation in South Africa. The tax deductible ‘discount’ that a section 12J Fund provides is a great incentive for investors to invest in projects of a developmental nature that can positively impact employment in South Africa,” said Govender.

In a video published on YouTube, Lingham said the fund has enormous potential to build globally successful technology businesses from South Africa.

“I’m looking forward to giving many more South Africans the opportunity to really make a dent in the global technology markets through this fund. We’re also excited about the opportunity to positively impact economic empowerment in South Africa, and the LionPride Agility fund is an important tool to achieve that,” added Lingham.

The major advantage of a section 12J investment fund is that investors can deduct 100 percent of their investment from their taxable incomes in the tax year in which the investments are made.

Govender, the head of the Lion Pride Agility Fund, expressed confidence in the board and the fund management team of LionPride Agility Fund. He envisions that the team will perform exceptionally well for both its investors and for South African technology entrepreneurs.

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