Sourcefin Gets $8.2M to Boost SME Financing in South Africa
TLDR
- Sourcefin raised ZAR150 million (US$8.2 million) from Futuregrowth Asset Management
- Founded in 2020, Sourcefin addresses working capital challenges for SMMEs, particularly those fulfilling public and private sector purchase orders
- The funding will enable Sourcefin to expand its alternative financing and supply chain support for small and medium-sized enterprises (SMMEs)
South African fintech Sourcefin has raised ZAR150 million (US$8.2 million) from Futuregrowth Asset Management's High Growth Developmental Equity Fund (HGDEF).
The funding will enable Sourcefin to expand its alternative financing and supply chain support for small and medium-sized enterprises (SMMEs), a sector often underserved by traditional financiers.
Founded in 2020, Sourcefin addresses working capital challenges for SMMEs, particularly those fulfilling public and private sector purchase orders. CEO Joshua Kadish stated that the full funding amount will be reinvested into South Africa’s SMME sector, which he described as the “backbone of our economy.”
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Key Takeaways
Sourcefin’s $8.2 million funding underscores the critical role of SMMEs in South Africa’s economy and the need for innovative financing solutions. Traditional lenders often fail to meet the sector's unique needs, particularly in addressing cash flow gaps for government and private-sector contracts. With backing from Futuregrowth, Sourcefin aims to scale its offerings and empower more businesses to overcome financial barriers. The investment reflects a broader trend of targeting high-growth, impact-driven companies in South Africa, including other Futuregrowth-backed firms like Yoco and Ozow. Efforts like these are pivotal in fostering economic growth, job creation, and the resilience of SMMEs in challenging market conditions.
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