December 2022 Newsletter

Dear Friends of Endeavor,

What a whirlwind year it has been both locally and globally — as we draft this, we are unsure who our president will be here in South Africa, and globally the war in Ukraine continues indefinitely as does the on-off Covid-19 situation in China.

There is a not a lot that we can do about the macro-environments we find ourselves in, but we’d like to wrap up the year with a focus on the Endeavor wins for the year that are, for the majority, self-determined. We are also pleased to share our solid trajectory of growth, and with that, a clear message that our mission at Endeavor to support high-growth entrepreneurs remains stronger than ever.

1) High growth entrepreneurs in the Endeavor network are powerful and inclusive job creators

• In the first six months of 2022 alone, 61 companies created 2,390 new jobs. This grew to 3,984 by year end, growing at simple average of 53% from 2021 to 2022 and is on track to reach a total employment of 20,667 by the year end.
• 80% of the new jobs created by Endeavor’s cohort of high-growth entrepreneurs will be occupied by local youth (defined as less-than 35 years) and >75% by black South Africans.

2) Endeavor partners with other organisations to create jobs, innovate and drive revenue growth across the ecosystem

• We now actively support 111 SA founded teams, up from 87 in 2021, and none of this would be possible without the pro-bono mentoring donated through our network. A very big thank you to all our mentors — and a specific shout-out to these 8 mentors in our local network who donated over 10hrs in 2022: Daniel Berman, Lisa Klein, Sarah Rice, Triya Govender, Llewellyn Watson, Melvyn Lubega, Herman Bosman & Isaac Shongwe
• There are 29 Endeavor Entrepreneurs in Endeavor South Africa. These businesses are founder-led, typically with annual revenue >R50m and growing at +30% p.a., they have passed both the Endeavor local and international selection panels and are scaling globally.
• Our partnership with the SA SME Fund supports the Local Scale Up, a cohort of a further 32 tech start-ups (annual revenue >R2m growing +50% p.a) assisting them with access to markets, mentors and capital through Endeavor’s local and global network.
• Endeavor has also partnered with FMO to form the Endeavor African Agri-tech Scale Up Program, initiated in early 2022 and provides 10 of the most promising early stage African Agri-Tech businesses access to Global thought leaders, curated mentorship, and investor networking.
• A partnership with the JSE on the JSE Accelerator has seen another 10 South African growth firms partake in this program over the past 12mths. These 10 businesses collectively delivered revenue growth of 29%, job creation of 23% totalling at end of 2022 R1.7bn revenue and headcount of 2638.
• Endeavor partners with Allan Gray E-Squared to extend the mentoring and Endeavor-led events to the earlier stage firms in E-Squared’s portfolio, exposing them to successful growth entrepreneurs

3) Endeavor provides access to capital via the Global Catalyst Fund and the local Harvest Fund as well as a feedback loop of reinvestment back into the ecosystem

• The Global Catalyst Fund IV had a final close in May 2022 at $280m
• The Harvest Fund II closed in April 2022 at R190m
• Harvest Fund III, launching now, is a R500m fund with an increased remit to include Africa, and a target 1st close April 2023
• All funds are rules-based, co-investment funds, reinvesting 100% of the GP’s carry back into the ecosystem.

4) Locally, we’re having encouraging discussions with SA government on Start-Up policy reforms

All environments are impacted by their specific governing legislation, which aims to provide useful handrails to enable the sector to thrive

• Together with SiMODiSA, SAVCA, SA SME Fund, Digital Collective Africa amongst others, Endeavor is engaging with government ministries to motivate for the amendment of key policies related to Start-Ups, specifically to simplify and reduce the cost of transferring a Start-Up’s IP internationally as well as establishing of a Start-Up’s global HQ (a pre-requisite for global VC’s) and to defer Capital Gains Tax associated with setting up an off-shore HQ to the future liquidity event, aiming to bring these three areas in line with “global Start-Up policy norms”.
• Conversations are now happening in the right corners to make this important act become a reality

5) Endeavor’s global orientation gives local entrepreneurs a bigger stage

• Our global footprint, with Endeavor’s HQ in New York, extends to over 40 offices, +500 global investor partners, +5000 global mentors and +2200 entrepreneurs ensures exposure of Endeavor SA entrepreneurs to both mentorship and funding at a global scale
• +75% of the entrepreneurs in our portfolio are scaling globally, fast-tracked by Endeavor’s network

With uncertainty all around, our mantra at Endeavor is to “play the ball in front of you”. We are proud of what we have managed to achieve in 2022 and look forward to another year of working with some of the most exceptional people, entrepreneurs, mentors, and partners, all focused on the Endeavor vision of dreaming big, scaling up and paying it forward — this starts where we are. That’s empowering.

Thank for you for sharing this year with us. A safe and happy festive season to all,

Kind regards,
Alison Collier
Managing Director: Endeavor South Africa