Dubbed the SA SME fund, it is one of the undertakings being spearheaded by the CEO Initiative and has the support of nearly three quarters of the JSE’s top 40 companies and other listed and non-listed private sector businesses.

The fund was created to help alleviate some of the major obstacles stifling entrepreneurship in the country, namely the lack of equity funding for start-ups, insufficient risk appetite for venture capital funding and access to high level mentorship.

READ MORE: Seda launches tool to help SMEs access funding

“SMEs are of a few entities that can create jobs at the quantum required. Yet almost 75% of small businesses fail. This fund will not only provide high-potential entrepreneurs and SMEs with access to capital, but it will also seek to connect entrepreneurs to a network of critical business and technical skills required to scale their businesses,” Discovery CEO and fund chairman Adrian Gore said.

Some of the participating businesses include Adcock Ingram, Standard Bank, the Public Investment Corporation (PIC), Sasol, MTN, Vodacom, Investec, Old Mutual, Telkom, Bidvest and Steinhoff.

READ MORE: Business Partners ups the stakes with R1,2 billion SME funding pledge

The fund’s management team, to be led by interim CEO Lisa Klein, will facilitate an accreditation process for private equity and investment funds – who will invest the money on the fund’s behalf – during the last quarter of the year with the first batch of money set to be released in the first quarter of next year.

“This is ultimately about creating the next generation of national champions. Entrepreneurs and businesses create jobs and by assisting them, we are building the future,” said PIC CEO Dan Matjila.

The rest of the board will be made up of well-respected CEOs and entrepreneurs, including Brian Joffee, Jabu Mabuza, Christo Wiese, Dolly Mokgatle, Judy Dlamini, Nigel Payne, Matjila and National Treasury director general Lungisa Fuzile.

READ MORE: What challenges do SMEs face?

“This is positive for South Africa. It shows that despite the political debate, business continues to focus on stimulating economic growth. SMEs will be the key driver of job creation and this fund is an important initiative in this space,” Mabuza said.