South African citizens can now invest in rapidly growing start-ups for as little as R50 a month, contributing to what local venture builder and business incubator Aions Creative Technology calls the ‘democratising of wealth’ in the country.
The company recently launched a micro-investment platform which it said would create a unique offering to start-ups seeking funding as well as South Africans looking to build wealth. It said AEX will allow investors to own a fractional share in one of the businesses currently being mentored by Aions, and to share in the profits when the business is sold after three years. All companies listed on AEX are high growth start-ups, with an innovative and technologically advanced approach to real world problems.
Aions founder and CEO Mitchan Adams said the platform was born using a range of methodologies from crowdfunding, stock exchanges, traditional VC models and ICO (Initial Coin Offering). It aimed to guarantee a minimum return of 10% a year over the three-year period but said the real returns could be significantly higher if the companies’ growth targets are met.
Serial entrepreneur Adams, who previously co-founded instant EFT and online payments fintech Ozow, said AEX aimed to allow all South Africans to participate in the investment and growth of start-ups, and benefit from the wealth created in the process, without the barriers and limitations of traditional stock investment options.
“Investing in start-ups doesn’t have to be reserved for the rich. In fact, micro-investing is the future of entrepreneurship in South Africa. By pooling investments from the ordinary person in the street, and investing in sound and innovative start-ups which can then scale and grow aggressively to be sustainable, we will create wealth and permanent jobs, which will result in true broad-based shared value,” Adams said.
The launch of AEX follows the recent announcement of a partnership between Aions and Telkom’s enterprise and supplier development programme, FutureMakers. As part of the partnership, FutureMakers has awarded R58 million in funding to Aions to grow technology-focused start-ups and small businesses.
Investors can choose from three incubator companies currently being funded and mentored by Aions. The Telkom funding will see this number grow to at least 10 in the coming 12 months. The three are financial wellness and salary linked benefit platform Level Finance; electric scooter start-up Green Scooter; and Tubby’s Kitchen, which manufactures a range of healthy cannabis infused kitchen products for home use.
Adams said the success of small businesses depended largely on getting the right exposure and opportunities. “Millions of South Africans and small businesses don’t get those breaks. We’ve got to become better at giving people opportunities and one way to do that is to make the public stakeholders in their success. That way, they benefit from the value-generating power of creating and selling viable businesses,” Adams said.
South Africans will be able to participate in the AEX platform from May 8 by visiting wealth.aions.co.za.
The Africa Wealth Report published by Henley & Partners last year revealed that total private wealth currently held on the African continent was $2.1 trillion and was expected to rise by 38% over the next 10 years, while Africa’s ‘Big 5’ private wealth markets together account for over 50% of the continent’s total private wealth.
BUSINESS REPORT