SAVCA Private Equity Conference 2025 recap: Day one was epic
This year marks the 17th edition of the annual event and once again brought together key industry players and thought leaders.
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By SAVCA
The first day of the 2025 SAVCA Private Equity (PE) Conference kicked off in the city of Cape Town with an LP Only Training programme on the 10 March 2025, then proceeded to the Century City Conference Centre on 11 March 2025.
This year marks the 17th edition of the annual event and once again brought together key industry players and thought leaders for a three-day gathering to explore the current state and outlook of the private equity sector.
Commencing the Conference day’s proceedings was esteemed MC and host, Nozipho Tshabalala, CEO at The Conversation Strategists. Nozipho used the platform to set the scene for the sector, highlighting key opportunities on the horizon. She welcomed SAVCA’s Chairperson – Vuyo Ntoi, who officially launched the day with an overview of private capital’s place in global and local portfolios, and the opportunity it holds as an asset class, for the South African economy and society at large. Vuyo shared the important work SAVCA has been doing over the past year in enhancing industry research and capacity building, as well as deepening its advocacy for private capital broadly, reflecting on the planning that went into crafting this year’s agenda covering the dynamism and agility of the Private Equity, Private Debt and Infrastructure asset classes. He also provided a brief overview of some of the noteworthy changes in the sector’s regulatory framework, such as the incoming COFI Bill, which was unpacked further later in the day.
Vuyo emphasised how this year’s theme, ‘Elevate with intent’ was all about growing with purpose, and bringing together minds, conversations and dialogues that will empower the sector, where collaboration was a key theme. He encouraged role players to think bigger, and act more decisively, together. Finally, before moving into the keynote presentation, Vuyo celebrated a key milestone, which related to the conference reaching over 600 participants for the first time since its inception. He took the opportunity to express his gratitude to the SAVCA team and CEO, Tshepiso Kobile, for all the hard (and often unseen) work that goes into planning this prestigious occasion.
Keynote address: The power of the economy
Renowned Economist and Professor, Adrian Saville thanked the SAVCA team for providing him with the platform to share his insights (and humour) on the South African economy, which he believes is made up of the three M’s: “Markets, Models and Mindsets”.
He touched on the challenges facing us and unpacked how we are caught in a “low-growth bind”, despite tailwinds that we have been able to leverage in recent history, such as lower and stable interest rates, as well as falling inflation. Despite the emergence of the GNU in last year’s pivotal elections, he commented that although we are in a materially stronger place as a country, both politically and economically than we were in March 2024, we are by no means strong, just yet.
He reflected on the role of capital allocators – highlighting the imperative need to discern news from the political noise that we are subjected to daily. He detailed six elements that need to be present to truly transform and empower an economy. These were: Savings and Investment, Demography, Policy and Institutions, Education, Health, and Openness.
A key portion of his address focused on how companies can maintain a competitive edge. This included the ability to be agile, which does not necessarily mean to be fast in your response – but rather, to choose the speed at which you respond. He expressed the importance of absorption, which relates not only to a business’ ability to ‘take punches’ and adapt to changes, but also to be able to throw those punches from time-to-time.
Debate: To consolidate, or not to consolidate – that is the question
For the first time ever, conference attendees were treated to a hearty, yet rigorous ‘debate’, about a key question that faces the industry – whether PE firms should, or should not, consolidate. While the session took the format of a debate, there were no winners or losers. Instead, the focus was to venture into this grey area and for attendees to walk away from the session with more insights on possible pathways for the growth of the PE sector.
Starting off the ‘against’ consolidation debate was Meta Mhlarhi, Co-founder and Executive Director of Mahlako a Phahla Group, partnering with Derrick Msibi, CEO at Stanlib. The argument was raised that having multiple independent asset managers allows for more diversity of skills, innovation, creativity, which is crucial in an emerging market like ours. Further, the duo highlighted the low success rates of consolidations and argued that investors do not seem to be in favour of this route. Despite popular belief, SA’s PE sector is already quite consolidated, they argued, with a few large firms dominating deal flow in the region. The point around the impact of consolidation on distribution channels was raised – and how too much consolidation was limiting the amount and potential for job creation, as well as for younger minds to enter the market.
In response to this, ‘for’ consolidation included insights from Sipho Makhubela, CEO at Harith General Partners and Isabella Mnisi, Sector Head for Asset Management and Funds at Rand Merchant Bank (RMB), who urged the audience to “be real and talk about the lived experience of emerging managers”. The main points raised were that the operational costs that small asset managers are required to keep up with, including heightened ESG reporting, are too high to tackle alone over a prolonged period. It was argued that consolidating would enable managers to make the financial burden lighter, as well as empower them to ‘wait out’ long lead times in fundraising, which are extremely common in PE deals. With smaller asset managers who sometimes only have specialised skills in one region, consolidating would enable managers to come together and share their geographical presence, skills and expertise – which would make them more attractive to prospective clients and investors.
Consolidating lowers the risk for emerging managers, who may succeed with reaching financial close on their first funds, then struggle with follow on funding to get to sustainable size, they argued. This in a context where there is low economic growth, low savings pool, low allocations to private markets and thus finite capital for private equity.
While the debate was indeed an in-depth and thought-provoking one, both sides conceded that for consolidation to be effective, it needs be done strategically and not to appease egos, and that ultimately it was not an either or discussion, as the South African market required diverse solutions to drive investment in companies. The audience, who started the conversation largely biased against Consolidation, was asked their thoughts on the debate via a poll, with 57% indicating that they were for consolidation, and the remaining 43% were against.
The evolution and opportunity of private credit in South Africa
Our first panel discussion looked at the growth of private credit in South Africa, and how a better understanding of its value proposition for investors, as well as the different strategies, risk profiles, contribution to broader portfolios and the ESG imperatives have become increasingly critical. The panel explored emerging trends and where South Africa is positioned in relation to developed credit markets.
Moderated by Reabetswe Kungwane, Investment Specialist at NinetyOne, who set the scene with a simple, yet important question – what is private credit? Sharing his response to this was Brent Blankfield, Head of Private Credit at Westbrooke Alternative Asset Management, who explained private credit as any loan that is not publicly listed, as well as lending by non-bank financial institutions into private companies. Brent emphasised that within this private credit market, there is significant scale to do business. Broadening the discussion on who the key stakeholders are in the space was Mokgome Mogoba, Founder and Managing Partner at Kholo Capital, who covered the broad spectrum of Stakeholders in the private credit market including investors, asset consultants, investment consultants, credit providers, private credit funds, life companies and government. “Borrowers, such as companies, from SMEs to large corporates, are also critical players in this space”, he explained.
Unpacking some of the key opportunities in the private capital sector was Vukile Themba-Mketo, Senior Portfolio Manager at Sanlam Investments, who shared that, “What we are seeing, is the banks are taking a risk-off approach since the 2008 crisis, not really wanting to be exposed to SME-specific risks. So, it begs the question, what happens then to the businesses that have identified the need for financing, but are not being serviced by the banks? We believe this is one of our biggest opportunities – to service the SME sector, to create a return for businesses and our investors, as well as to have a positive social impact.”
The general sentiment from this panel was the importance of private credit in plugging the funding gaps , complementing private equity on large acquisitions, and how any client or business that is either: (1) looking for funding and wants to deal with nimble and agile teams, and not slower, bureaucratic processes that often come about when dealing with banks, or; (2) requires sophisticated or tailored loans for their buyout transactions, are the ideal candidates for private capital investment. The panel concluded with various ‘war stories’ that panelists had navigated in their respective positions, which highlighted the resilience and adaptability of the private credit market, and its key players.
Understanding the COFI Bill, and a deep dive into key considerations for private equity funds
In this fireside chat, moderated by Kent Davis, Partner at Webber Wentzel, key insights were provided into the upcoming Conduct of Financial Institutions (COFI) Bill, as well as the considerations and implications for PE funds. Kickstarting the discussion was Vukile Davidson, Chief Director of Financial Markets and Stability at the National Treasury, who firstly highlighted the importance of Private Equity and Venture Capital roles in scaling up infrastructure funding and supporting early-stage firms. With the large movement of financial activity from intensely regulated parts to non-banking financial intermediary space, this called for a proportionate regulatory framework to help mitigate the risks that are specific to these sectors. He shared the benefits of the COFI Bill for the asset class: “There are a host of existing, fragmented regulatory policies that COFI will consolidate into a more concise, regulatory approach and framework. We firmly believe that when this is implemented, it will drive more effective, and transparent market outcomes. During the 2008 crisis and the years that followed.”
Providing further comment on the COFI Bill was Eugene du Toit, Head of Regulatory Frameworks at the Financial Sector Conduct Authority (FSCA). He addressed the misconception that COFI is retail focussed, emphasising that the focus is holistic conduct in the financial system. He shared insight into the impact of the Bill on small and emerging firms, highlighting that as this was a framework, a lot of detail would sit in the Standards set by the Regulator: “COFI adopts an outcomes – principles approach to regulation, which is different compared to previous financial laws, which had very detailed, non-negotiable requirements that businesses had to meet. With COFI’s principles-based approach, businesses are provided with the flexibility to structure controls in a way that makes sense for them.”
When sharing their parting thoughts, Vukile said they are “Excited about the implementation of a flexible and proportionate framework that will help alternative investment funds ‘unshackle’ and get more investments flowing into their operations. This Bill is more fit for purpose and will help funds to deploy capital in a way that helps the real economy, while also addressing some of the unique risks the sector faces.”
Further easing any fears or apprehension around the bill, Eugene asserted: “We are not talking about a Bill that is going to be implemented, and everything is going to change from day one. This will be rolled out in a phased approach, from licensing to frameworks, over a long period of time. We will provide a lot of clarity for businesses, and this asset class that will clearly outline what the implications are going to be.”
Overall, the sentiment of this fireside chat eased concerns and highlighted that the positives will far outweigh the ‘negatives’ for the asset class once COFI is implemented, with the next phases anticipated in the third and fourth quarters of this year. The audience, and industry at large, were encouraged to participate and engage with the COFI Bill consultation processes, so that any concerns can be raised and swiftly addressed.
Limited partnerships and permanent capital vehicles
In our next presentation, led by Shayne Krige, Head of Investment Funds at Werksmans, a key focus was placed on demystifying limited partnerships, also known as En Commandite Partnerships. In this session, Shayne explained some of the key differences between ordinary and limited partnerships.
Unpacking some common misconceptions around limited partnerships, he shared the following: “Some believe that the liability of a limited partner is limited to the capital they have invested – this is incorrect. Their liability is limited to their committed capital”. Another misconception that a limited partnership is the same as a silent partnership was also not the case. “A silent partnership is separate and what we call an extraordinary partnership. This means that the silent partner has no liability because they are undisclosed. However, the basis for the limitation of liability in a silent partnership is because the partner is unknown – whereas in a limited partnership, it’s not the same basis for the limitation of the liability.”
Another misconception related to the belief that limited partners lose their liability if they are disclosed. This too is not the case. If you are disclosed as a limited partner, creditors would not have relied on your investment, as you are not a general partner.
The presentation was concluded by an in-depth breakdown of the various types of funds, the benefits of permanent capital vehicles (PCVs), their fiduciary responsibilities, the need to address the issue around liquidity in PCVs, and finally – the role of legal structures.
Portfolio company showcase – The Courier Guy and LightWare LiDAR
During this portfolio company showcase, Tshegofatso Tshukudu, Investment Manager at Adenia Partners highlighted their journey with investee company – The Courier Guy, and some of the key successes of their partnership. The Courier Guy deal was the largest transaction Adenia has ever done, and he used the forum to highlight how co-investment is becoming a key priority for direct foreign investors (DFIs), and why it is attractive for limited partners. Tshegofatso also acknowledged some of the challenges they have experienced with co-investment deals, as well as what makes a good deal lead.
Next up, we heard from Samantha Pokroy, Founder and CEO at Sanari Capital and Nadia Nilsen, Co-founder and CEO at LightWare LiDAR. Here, the pair shared how their partnership enabled what was a bootstrapped company, to take its technology from South Africa to the world. LightWare are pioneers in LiDAR with compact, ultralight, and high-performing sensors that enable machines to perceive their surroundings. The partnership and collaboration with Sanari Capital enabled the business to establish a US-based subsidiary, quadruple production capacity and rapidly scale business operations and profitability.
How investors are driving responsible collaboration and investing
Our final fireside chat for the day was moderated by Mabatho Seeiso, Independent Trustee and TAF Director – who spoke to Thomas Mketelwa, Member of the AOFSA and Sonja Saunderson, Chief Investment Officer at the EPPF, on how investors are driving responsible collaboration and investing in the pension fund space.
In this discussion, the three unpacked the need for pension funds to be strategic and smart about where they invest, and the need to mobilise funds to contribute towards the real economy. The conversation linked to what asset owners need to do more of to increase their efficiency. Through the pooling of resources, expertise, capital and even collaboration on due diligence processes, the AOFSA platform allows institutional investors to ensure risk sharing, and create liquidity in investments such as infrastructure, which standalone funds may be unable to invest in. This was the asset owners’ way of elevating the status quo, by facilitating product innovation, enhancing returns and enhanced efficiencies.
As Sonja put it “For asset owners to be more effective and impactful in so far as creating financial inclusion in the industry, we need to embrace collaboration – which will enable us to share risks and costs with other asset owners. We can also look at sharing IP, and we can challenge each other to look for new investment ideas, and to have a soundboard about how other pension funds are assessing opportunities.”
About SAVCA
The Southern African Venture Capital and Private Equity Association (SAVCA) is a non-profit industry association, representing over 230 members in Southern Africa, who collectively manage in excess of R237bn in assets.
SAVCA promotes Southern African private equity, private debt, and venture capital by engaging with regulators and legislators on a range of matters affecting the industry; providing relevant and insightful thought leadership and research on aspects that impact the industry; offering training and capacity building opportunities to stakeholders in the ecosystem; and by creating meaningful networking opportunities for industry players, investors and capital seekers.