South Africa’s venture capital ecosystem is beginning to close one of the most important gaps in its growth story: exits. Two new studies by the SA SME Fund, Endeavor South Africa and SAVCA provide compelling evidence that local venture capital can deliver both meaningful investor returns and broader economic impact.
The South African Venture Capital: Exit & Performance Analysis, which looked at 226 realised exits reported by South African venture capital fund managers between 2009 and 2026, found that realised cash returns substantially exceeded invested capital, with capital-weighted realised returns ranging from 2.01x to 2.45x invested capital across the scenarios analysed.
This analysis found that South African venture capital has delivered realised return characteristics broadly in line with those observed in more mature markets, including the United States, the United Kingdom, Europe and India, providing growing evidence that venture capital is becoming an increasingly attractive asset class for long-term investors.
Related: Spiro Fuels Quarter of Africa’s H1 2026 Fintech and Logistics Funding
The Exit Case Studies Analysis looks at 18 South African venture capital-backed exits between 2014 and 2026. The sampled exits delivered a median gross internal rate of return of 54%, a median gross money-on-invested-capital of 3.5x, and a median valuation at exit of approximately R1.6 billion.
Beyond investor returns, the high-growth sector that these companies operate in has seen revenue growth by 256% and employment growing by 49% since 2021. Collectively, the exited companies created more than 4,000 direct jobs, averaging around 230 South African jobs per company, highlighting the broader economic impact of South Africa’s high-growth scale-ups.
Together, the findings suggest South Africa’s venture capital ecosystem is moving beyond isolated success stories towards a more mature investment market capable of attracting greater institutional capital. The findings challenge the long-held perception that South Africa can produce promising young companies but struggles to produce sufficient venture-scale exits.
While the market remains relatively young by global standards, the data points to a clear shift: exits are increasing in size, pathways are diversifying, and several landmark transactions have taken place in the past two years. Recent examples include Mastercard’s pending acquisition of BVNK, RapidDeploy’s acquisition by Motorola Solutions, iKhokha’s acquisition by Nedbank, Adumo’s acquisition by Lesaka, Quicket’s acquisition by Ticketmaster, and Optasia’s listing on the JSE.
Related: Browser Extension Blocks Knockoff Brands on Amazon
Ketso Gordhan, CEO of the SA SME Fund, says the emergence of stronger exit evidence is significant because exits are the mechanism through which venture capital proves its ability to recycle capital, reward risk and attract new investment into the ecosystem. South Africa has long had entrepreneurial talent, credible founders and strong technology capability. What has been less visible is the proof that investors can realise meaningful returns from backing these companies.
Ketso Gordhan, CEO of the SA SME Fund, says the emergence of stronger exit evidence is significant because exits are the mechanism through which venture capital proves its ability to recycle capital, reward risk and attract new investment into the ecosystem. “South Africa has long had entrepreneurial talent, credible founders and strong technology capability. What has been less visible is the proof that investors can realise meaningful returns from backing these companies. These studies show that the exit market is no longer theoretical. It is starting to happen, and it is happening across different pathways,” says Gordhan.
The report identifies four main exit routes now active in the South African venture capital ecosystem: international mergers and acquisitions, domestic mergers and acquisitions, secondary transactions and, more recently, IPOs. International M&A has historically been the most common route, with South
Anusha Naidu, CEO of SAVCA, says the combined findings provide important evidence for institutional investors assessing South African venture capital as an asset class. The ability to demonstrate realised exits is fundamental to the development of any private capital market.
Related: Qualcomm Chip Price Rise to Lift Phone Prices
While recent exits demonstrate growing maturity, the research suggests the strongest wave may still lie ahead. They identify more than 20 privately held South African high-growth companies with significant local operations that have each raised more than US$25 million.
Gordhan says this represents an important moment for South Africa’s innovation economy. If they want more high-growth companies, more jobs and more globally competitive businesses, they need to deepen the pool of capital available to founders and fund managers. Exits are the evidence investors need to come back, write bigger cheques and stay the course.
Karl Westvig, founder of Retail Capital, which was acquired by TymeBank, says successful exits create benefits that extend well beyond investors. The real value of an exit is what happens the day after. Capital gets recycled, and founders and teams walk away with proof it can be done here.
Leave a Reply