Barloworld launches R30m fund for social entrepreneurs
Johannesburg - Barloworld Limited said on Thursday that it wants to bridge the gap for start-up social enterprises across South Africa and do things differently with a R30 million fund for most innovative business ideas that actively solve local challenges.
The industrial conglomerate on Wednesday launched Barloworld Mbewu, a next generation approach to corporate social development geared towards scaling up social enterprises. Mbewu means seed.
In an interview at Barloworld headquarters, Noluvo Ngcwabe, head of corporate social investments (CSI), said that the company's research has found that there was a gap in the market to fund social enterprise ventures in South Africa.
Even though there is no consensus on the precise definition of social enterprises, they can be thought of as those business ideas and initiatives that look at providing solutions to existing problems and challenges within a particular community, such as how to recycle water during a drought.
"What we want to do with this initiative is to bridge a gap in terms of social entrepreneurship. We are starting to see a lot of young people who are solving community problems, however they don't want to be labelled as non-profit. And they would want to be compensated for the solutions they are providing, but the mission is not driven by profits," Ngcwabe said.
"Whilst they are in this journey, no one is listening to them from the corporate point of view because they are neither CSI nor fully-fledged entrepreneurs. And that is how Mbewu was germinated. The business has set aside R30 million for the next three years."
Ngcwabe said the funds in the R30 million available through Barloworld Mbewu can also be used by approved social enterprises as collateral to "unlock" finance when they apply to financial institutions for further funding.
She said Barloworld Mbewu will be building a network of key stakeholders to support capacity building and incubation, and ensure measurable growth of players in the social economy space.
"The old CSI models, depending on who you are, create dependency. Entrepreneurs literally depend year-on-year on getting funding. Traditional CSIs ensure the cycle of continuously applying [for funding]. From a corporate South Africa point of view, we are saying let us collaborate so that we can make an impact because silo CSI is not helping anyone," Ngcwabe said.
"We are looking at sustainable ways...so that you are not dependent on annual grants, but you run a business that generates profits and those profits are reinvested back in the business so that you can keep running every year even when you don't get funding."
Barloworld Mbewu is a three-year initiative in which selected social entrepreneurs will provide financial and non-financial support to promising social enterprises.
The programme is only open to South African social entrepreneurs that have a track record of at least 12 months. It will focus on social enterprises that empower children, the disabled, youth and women and which operate in education, agriculture, environments and green economy, the automotive value chain and social innovations.
Applications opened online from Wednesday and Barloworld Mbewu will stage events in all nine provinces to explain the programme and help prospective applicants.
The application portal closes at midnight on 31 July, after which approved social enterprises will be invited to The Big Pitch. This is where they will meet the Barloworld Mbewu adjudicators who will decide the level of support social enterprises will receive over the three year incubation period.
African News Agency/ANA