South African Section 12J venture capital firm Kalon Ventures Partners has announced a better-than-expected capital raise that means each of its funds have in excess of ZAR100 million (US$6.85 million) each.
An investor in the likes of Ozow, FinChatBot, Flow and Mobiz, Kalon in February concluded a successful capital raise bringing its total Assets Under Management to over ZAR200 million (US$13.7 million).
The Section 12J tax breaks for investors, which offered rebates to South Africans if they made investments through approved venture-capital companies, was introduced in 2008 to encourage investments in startups and SMEs, riskier investments that nonetheless could help to create jobs and stimulate economic growth.
It was set to expire on June 30 of this year, and though it had been expected to be renewed, South Africa’s Treasury announced in its Budget 2021 statement that its objectives had not been “sufficiently” achieved, and that the scheme would be scrapped. This means June 2021 is the last opportunity to invest in such a fund, with prior investments not affected.
This seems to have created somewhat of a rush, and Kalon has confirmed it is planning its final Section 12J raise between now and the end of June.
