The Financial Securities Exchange Limited (FINSEC) has launched a private funding marketplace called FINSEC Private Markets. The platform comes in the wake of FINSEC’s other funding offering called the Growth Enterprise Market (GEM) Portal which was introduced back in 2020.
The GEM portal was designed to help small to medium enterprises find financial backing as well as explore the possibility of listing online. It underwent a pilot phase in January 2020 where 17 SMEs across various sectors; 2 leading fund managers, 4 nominated advisors, 2 commercial banks and 1 mobile money operator registered on the platform to play various respective roles in enabling identification and funding of deserving high growth SMEs.
After the trial phase, the GEM Portal made its way onto the market and didn’t look only at financial assistance but FINSEC wanted to incorporate incubator and accelerator services. Well, it appears the portal wasn’t exactly what all SME’s wanted especially the pathway to listing.
“In response to this demand for private debt and private equity funding, FINSEC is introducing the FINSEC Private Markets, an innovation tailor-made for the demands of growth enterprises and emerging local brands. FINSEC Private Markets is a unit wholly owned and operated by the exchange and is a private funding marketplace for businesses at every stage of development including those in start-up; growth, maturity, and declining phases.”
Garikayi Munema, FINSEC Manging Director (via The Chronicle)
“The platform provides enterprises with value discovery; exit options; pre-IPO (initial public offering); IPO and listing pathways. FINSEC Private Markets is available to qualified institutional investors (QH); high networth individuals (HNIs), Development Finance Institutions (DFIs); and local or international private investors looking for alternative investment opportunities with growth potential.”
FINSEC Private Markets has addressed that by offering SMEs an exit route if the IPO route isn’t in their immediate plans. This offers flexibility for startups because they can properly grow their products and services and list when suits their timeline.
On that note it doesn’t appear that FINSEC’s GEM Portal is going away, the platform has received more than 150 applications which include a commercial bank, seven financial advisory companies and four institutional investors.
“Investors enjoy access to screened and de-risked investment opportunities utilising exchange infrastructure. The FINSEC Private Markets will also bring together and avail expertise in the capital raising and investments value chain. These include, financial advisors, investment analysts, and legal advisors to provide support to capital raising by enterprises”Garikayi Munema, FINSEC Manging Director (via The Chronicle)