• Apply for Funding Here

  • Apply

Directory: Funding Options for Small Businesses in South Africa

Posted on Jan 17th, 2022
Articles Funding Funding Advice slideshow

alternative funding for small businesses

For entrepreneurs looking to launch businesses this year, here is a list of funding options for small businesses, including business loans, crowdfunding and venture capital investors that back startups.

Bootstrapping

Fund your business through your salary from a 9 – 5 or by generating an additional income stream from a side hustle.

Read this:

Business Loans and Financing

Traditional banks are no longer the only ones offering business loans and financing; there are many fintech companies that offer finance instruments to help increase the working capital in your business. Short-term loans can be used to finance a business’s everyday operations. Each finance instrument has its own benefits and criteria.  An example of a type of specialist financing is purchase order funding which can be used to service an approved tender or purchase order.

Find the right finance product for your business – Compare the top lenders for the following:

Competitions

Business competitions or contests can get you in front of potential investors and have you win large amounts of prize money for your business. Depending on the competition, you might be asked to pitch your business idea and/ or to provide a prototype.

Read this:

Crowdfunding

This alternative funding option is good way for small business owners to raise capital as it offers a low barrier to entry. You can choose a crowdfunding platform to set up a campaign and raise capital in exchange for rewards, equity based, or debt.

What to read:

Enterprise Supplier Development (ESD) programme

These types of programmes offers small business owners both financial and non-financial support. The Masisizane Fund by Old Mutual is an example of an ESD programme, it has a specific focus on black-owned businesses.

Read this:

Grants

Grants provide both financial and non-financial business development support. The majority grants are industry-specific and/ or focuses on a particular group of people such as women, youth, disabled, Black business owners, or co-operatives.

During the COVID-19 pandemic there were also opportunities for small business owners to apply for relief funding.

What to read:

Government Funding (South Africa)

The different types of government funding include cost-sharing grants, incentives, tax incentives and equity funding.

What to read:

Venture Capital and Angel Investment

There are many venture capital funds and private investors like angel investors from both abroad and locally that invest in South African startups. It is important to do your research on an investor prior to applying for funding as each investor has their own requirements– some may only make investments for specific industries and/ or have a focus on women-owned businesses, youth-owned startups, or Black-owned businesses.

What to read: