As a promoter of economic growth, infrastructure and human skills development, it is once again our pleasure to be part of this project. The results of this year’s research clearly show that private equity investment plays an important role in the development of businesses. There are several favorable outcomes from private equity and venture capital investment besides providing access to capital, these companies bring dynamism, a depth of operational experience, huge financial acumen, contacts, strategic partners and foresight.
For over half of the respondents (56%) of our survey this was about speeding up the pace of growth; for another sizable group (46%), private equity capital was instrumental in keeping the business afloat; and for one fifth (20%) of respondents, private equity firms facilitated the introduction of Economic Empowerment standards.
It is important to emphasize that the benefits of private equity and venture capital transactions are not confined to start ups. They affect the broader economy. As we face several economic challenges, including exceptionally high and persistent unemployment. It is rewarding to note the effect this type of investment has on job creation.
Only 11% of respondents in the current sample indicated that raising private equity capital had resulted in no discernible positive impact. This is the same percentage as the first study five years ago, and the fact that this has not risen despite the very different trading environment during the latest research period suggests that the private equity community has been effective in maintaining growth and operational improvement.
To mention just one statistic from the many positive observations, companies with private equity and venture capital investors clearly do create employment, and those in our survey indicated they have grown their staff by around 40% in the two-year period. The businesses we examined were also able to showcase the progress they have made in economic empowerment ratings with the assistance of private equity investors and venture capitalists like Shockproof Capital Partners.
Additionally with the introduction of private investor funding, some well-considered and carefully directed risk-taking becomes possible. New products and enhanced customer offerings become a reality. Untapped markets open up for investors. Revenues can grow, and translate directly into enhanced profitability.
Several years and one global financial crisis further on, that assertion remains true. The findings of this latest survey, based on in-depth contact with 60 private equity backed businesses, provide strong evidence that private equity firms continue to create both employment and value in the domestic and international markets. The statistics also show that private equity investors tend to be forward-thinkers, keen to finance the present and future needs of the companies that they are backing through significant capital expenditure and investment in R&D. Their focus on helping start ups to install corporate governance structures also represents a major contribution to the growing sophistication, quality and robustness of these companies.
Businesses do develop society in other ways as well. They improve governance structures and standards and become more responsible corporate citizens, with a social conscience. When experienced investors and entrepreneurial start ups combine their goals, vision and innovation, some inspirational stories can emerge.
For more information please visit: www.shockproof.capital
Company Name: Shockproof Capital Partners
Contact Person: Media Relations
Address:82 Maude Street
Country: South Africa