Jeff Miller, CEO and Co-Founder, Grovest
Starting a venture capital or private equity fund, no matter how experienced you are, can be a very daunting task.
We understand that dealing with third party funds requires a stringent compliance and governance framework as set out in the Financial Sector Conduct Authority (FSCA). Not only do all registered funds require specific licencing, a regulatory risk plan and bespoke policies, but also an experienced and compliant Key Individual, a licenced Compliance Officer, and company representatives. To navigate all these governance and skillset requirements can be a very expensive and time-consuming exercise.
From our frequent interaction with first-time and emerging fund managers, compliance and administration are not the only challenges they face when setting up a fund. Their seeming lack of credibility, support and access to networks and working capital facilities places an even bigger burden on their shoulders.
In the last year or so, we’ve also observed that South Africa has a shortage of black fund managers and women fund managers, creating a talent deficit in the private markets space.
All these reasons, plus our commitment to continually innovate and overcome challenges, led to the Rencell Concept.
Rencell is well positioned to provide fund managers with the opportunity to hit the ground running.
Benefitting from years of experience in navigating the requirements for setting up registered funds with the FSCA, Rencell offers fund managers an affordable, fully licenced, and compliant private equity and venture capital structure which they are able to utilise to get their fund up and running in little as two weeks.
Historically, private equity and venture capital were predominantly supported by pension and provident funds, insurance companies, retail and investment banks, sovereign funds, and large family offices. The Section 12J tax incentive, albeit short lived, provided retail investors with access to this attractive asset class for the first time, where it is estimated that retail investors invested approximately R12.5 billion into small cap venture capital and private equity funds.
Rencell is empowering the next generation of South African fund managers with an innovative, affordable, and compliant structure that optimises fund success..
Rencell offers fund managers (“Share Class Manager”) a ring-fenced share class in a registered Cat I venture capital and private equity public unlisted company. The allocated share class is managed by the Share Class Manager who is responsible for capital raising and capital deployment. Rencell will handle all compliance matters.
The directors of Rencell, being experienced corporate financiers, work with the Share Class Managers to manage secretarial, financial reporting and communications to investors.
Rencell is administered by Grovest, the largest small cap fund administrator in South Africa. Grovest currently has funds under administration in excess of R3.5 billion and administers 30+ Funds. Grovest is well known as the pioneers of Section 12J. They pride themselves on being a professional, solutions-driven boutique corporate finance house.
Rencell is now open for investments in Fund II, having closed Fund I with R85 million.
The fund structure is a key consideration when setting up a fund. I, therefore, encourage any new or emerging fund manager to consider the Rencell fund structure. It’s efficient and affordable, enabling you to get your fund started with the least amount of stress.
