Company

RMB Ventures is a mid-market, South African private equity investor. As a subsidiary of FirstRand Limited we are an on-balance sheet provider of private equity capital and have invested in over 40 transactions since the mid-1990s. Our close association with Rand Merchant Bank (RMB) gives us access to the full suite of investment banking products.



History

In 1977, RMB was started by entrepreneurs: GT Ferreira, Laurie Dippenaar and Paul Harris, as a niche, structured-finance house — the beginnings of what is now the FirstRand Group. The founding members established their entrepreneurial enterprise on the foundation of Traditional values. Innovative ideas.

RMB Ventures was born in the mid-1990s, a child of the Corporate Finance business who saw the opportunity to invest in equity alongside RMB’s client base. The team has evolved into one of the largest, most successful private equity franchises in Southern Africa, with a total of eleven transactors — investing in more than 40 businesses over the past 15 years.



Offering

At RMB Ventures we invest predominantly in established South African businesses with demonstrated track records. We always partner with management and provide flexible equity and debt funding packages. Our offering includes:

  • Management and Leveraged buy-outs — We provide the financial and technical capability to enable management teams to buy their businesses from existing shareholders
  • Management buy-ins — We back individuals in the purchase of businesses in which they have the relevant expertise and a proven track record
  • Acquisition capital — We provide capital and bring significant M&A experience to the execution of add-on acquisitions
  • Growth capital — We provide capital for new plant and equipment, facilitating the development of new products and markets, including access to RMB relationships for expansion into Africa
  • BEE funding — We provide funding for BEE players to acquire stakes in companies, both as part of RMB-led management buy-outs and as stand-alone deals


Approach

At RMB Ventures we partner with management teams of companies that have a sound knowledge of their industry, are passionate about their business, and are unwavering in their dedication to creating shareholder and employee value. We also partner like-minded investors in businesses that display these characteristics. We are passionate about developing strong relationships with these management teams, while ensuring RMB Ventures’ interests are clearly aligned strategically, ethically and financially.

We apply the following investment criteria when looking to invest in new business:

  • Businesses should demonstrate recurring annual earnings before tax of at least ZAR40-m (unless exceptional growth opportunities can be clearly demonstrated)
  • Management must be competent, understand their business and industry intimately, and demonstrate enormous passion to succeed
  • Businesses should be well positioned in their respective markets, and management should be able to show a defendable business model
  • Businesses should have demonstrated the ability to generate good cash flows over a long period of time

We do not invest in:

  • Property
  • Primary mining activities (we will invest in mining services)
  • Agriculture
  • Venture capital, start-ups or angel funding


Our people and culture

At RMB Ventures we combine innovative thinking with solid technical skills to contribute to the greater vision of thinking that can change the world. Our Traditional values. Innovative ideas philosophy helps us to understand the needs of the entrepreneurs we back.

Our team has over 60 years’ combined private equity experience across a broad range of industries. We attract talent with a diverse skillset who are self-motivated, ambitious and entrepreneurial. We understand the dynamics and requirements around partnering with management teams to create value over the medium to long term. We have extensive experience in structuring buy-outs and buy-ins.

In line with our over-arching philosophy to back capable and aligned management teams, we do not get involved in the day-to-day operations of our portfolio companies. We are however able to add significant value to our investments through:

  • Optimisation of capital structure
  • Providing access to acquisition opportunities and assisting with the evaluation and structuring thereof
  • Providing access to both additional equity finance and debt finance through the FirstRand Group
  • Facilitating cross-selling opportunities among portfolio companies
  • Strengthening corporate governance structures
  • Working with management to develop a clear business strategy
  • Acting as a sounding board for management on key issues and providing access to our network of industry experts where necessary
  • Leveraging off our experience to maximise value for all shareholders on exit


Commitment to BEE

RMB Ventures is fully committed to supporting transformation in South Africa by partnering with Black Economic Empowerment (BEE) entities in almost every transaction. We have excellent relationships with BEE financial investors with established track records, and we will fund credible BEE parties who introduce viable opportunities to RMB Ventures.

Some of our current and past BEE relationships include: The Tiso Group, Kagiso Trust Investments (now merged as Kagiso-Tiso Holdings), Yard Capital, Sphere Private Equity, Pan-African Private Equity, Pan-African Capital Holdings and Phatsima Growth Fund.

We actively promote and drive transformation and skills development in all our portfolio companies through training and apprenticeship opportunities, procurement and creating a representative workforce.



Responsible investing

At RMB Ventures (through our portfolio of companies) we make decisions that can have an enormous impact on the employees and the operations of our portfolio companies, including the communities in which they operate. We therefore have an obligation to our stakeholders and to ourselves to act responsibly towards environmental, social, and ethical issues surrounding our investments.

One of the key strengths of our private equity governance model is that the alignment of interest between investors and company management teams is long-term. This allows management to pursue strategies that benefit the sustainability of an enterprise, its employees and stakeholders.