The Jobs Fund is a government initiative that seeks to help create jobs by supporting initiatives that generate employment in innovative ways.
Well-known examples of local businesses that have received funding from the Jobs Fund include SweepSouth and Nova Pioneer.
SweepSouth, the on-demand home cleaning services company received funding from the Jobs Fund in 2014. Since then, SweepSouth has gone on to create thousands of job opportunities for women, the vast majority of whom were previously unemployed. In October 2019, Sweepsouth revealed to Business Insider that they had created over 15,000 domestic worker jobs since their launch in 2014.
Nova Pioneer is an independent school network. They received a R15-million debt investment from the Jobs Fund through the Vumela fund in 2017. The group is helping to address the growing demand for private schools as the public education system continues to face challenges. The expected impact of this investment was the creation of over 500 direct new permanent jobs and capacity for 15,000 learners over the next five years.
[Update: The Jobs Fund does not provide grant funding directly to startups or small businesses, but rather provides grant funding to successful intermediaries which implement projects aimed at assisting small, medium and micro enterprises (SMEs) across the country.
The intermediary an SME would approach would depend on the type of assistance required (funding, incubation etc.), the model/requirements of the project as well as the sector the project operates in.
A list of most of the Jobs Fund enterprise development partners is available here.
Two examples of intermediaries are the Women’s Development Bank and the Small and Growing Business (SGB) Fund.
The Women’s Development Bank (WDB) Growth Fund
The WDB Growth Fund Enterprise and Supplier Development Programme saw the Jobs Fund approve a seed grant of R 40 million, in turn leveraging additional private funding of approximately R 60 million from WDB Growth Fund Pty (Ltd) in partnership with Seed Academy and WDB Investment Holding. Other investors included the Small Enterprise Finance Agency, SIOC Community Development Trust and Standard Bank.
The combined R100 million fund, known as the WDB Growth Fund (The Fund), is supporting 20 SMEs through equity investment, pre-investment, tailored and sector mentorship, and post-investment. The Fund is targeting SMEs in the retail, services, manufacturing, tourism, ICT, motor repairs, hospitality, secondary agriculture, fuel and textile sectors, assisting these SMEs with relevant market access.
The Small and Growing Business (SGB) Fund
In a similar on-lending programme, the Jobs Fund provided GroFin South Africa (Pty) Ltd, a 100% subsidiary of GroFin Managers, seed grant of approximately R 104 million. GroFin will use this grant to leverage approximately R 156 million in matched funding – composed of R 127 million from GroFin’s Small and Growing Business (SGB) Fund, R 18 million in GroFin’s own matched funds, and R 11 million in in-kind contributions.
The bulk of the finances will be used to provide loan financing to 42 SMEs.]
Below are answers to some of the biggest Jobs Fund’s biggest FAQs.
1. Application process
The Jobs Fund considers proposals from municipalities, government departments, private sector and not-for-profit organisations. The Fund looks for innovative, scalable solutions for job creation.
The Jobs Fund has a two-stage online application process: the Concept Application Stage and Full Business Application Stage. The application process begins when the Fund opens a funding round and issues a call for proposals. Applications are competitively assessed.
The decision to allocate grant funding is made by an independent investment committee.
According to the website:
– Applicants must demonstrate the ability to secure matched funding at a minimum matched funding ratio of 1:1. Projects that offer a higher matched funding ratio will receive preference;
– Projects will be given a maximum of three years (36 months) to implement and deliver the direct jobs promised;
– Applicants must be in full compliance with administrative requirements (including a valid tax clearance certificate or if expired the expiry date must not be older than six months);
– Applicants (contracting party) must be solvent, have been operating for more than two years, and have complete annual financial statements for the previous two financial years (these criteria apply specifically to the lead applicant);
– Implementers must have a verifiable track record of at least three years technical experience in the area of interest.
See also: A Guide to Government Funding for SMEs
2. Requirements entities must meet to qualify
All applications are reviewed against a set of eligibility and impact criteria. Grant funding is allocated on a competitive basis and organisations that have the ability to crowd in ecosystem support and leverage funding are assessed favourably.
The funding criteria is announced when a call for proposals is made, these include:
- Ability to secure matched funding
- Value for money
- Sustainability
- Innovation
- Industry experience
- Capacity to implement
3. Funding amounts
4. Additional benefits of the funding
• Jobs Fund as a catalytic agent in the market:
• Jobs Fund playing a capacity-building role in the market:
• Jobs Fund as an accelerator of labour market transitions:
– The facilitation of skills development and transfer has been achieved by the grant bridging the skills gap between unemployed youth in South Africa and the skills demand from employers in the market. Through its support for demand-led interventions, the Jobs Fund has supported skills development and matching to vacant jobs, accelerating the transition from education to employment.
