VCTF gets US$40m boost

Yaw Owusu-Brempong, CEO Venture Capital Trust Fund

The Chief Executive Officer (CEO) of Venture Capital Trust Fund (VCTF), Yaw Owusu-Brempong, has assured of his outfit’s readiness to support startups and small and medium enterprises (SMEs) to achieve growth.

This comes on the back of the government’s decision through the Ghana Economic Transformation Project (GETP) to recapitalise VCTF with US$40 million, in what is seen a change in fortunes for the once cash-strapped fund. Its recapitalisation could offer SMEs much-needed capital to revitalise the recovery process.

“Fortunately for us, for the past two years, venture capital has been given attention and we have been recapitalised with an amount of US$40 million to actually invest in more funds so that we can invest in SMEs. We have started investing in funds; last year we invested about GH₵95 million in four funds and in 2023, we intend to commit more. These fund managers are going to leverage them to raise additional money so, they have enough to invest in SMEs,” Mr. Owusu-Brempong said.

The VCTF operates through Venture Capital Finance Companies (VCFC). Each VCFC is managed by a fund manager, licensed by the Securities and Exchange Commission (SEC). VCFCs (fund vehicle) act as intermediaries between SMEs requiring funds for viable business projects and the Trust Fund.

Speaking at an SME roundtable in Kumasi, the Ashanti Regional capital, Mr. Owusu-Brempong, hinted that the fund is working at a full force as they have adequately been recapitalised and expects to raise GH₵100 million this year.

Mr. Owusu-Brempong explained that the fund initially, was supposed to get 25 percent of the national reconstruction levy but unfortunately, the levy was scrapped the very year the trust started operations.

Left with no option, he said the VCTF have had to rely on budgetary allocations which are not only irregular but inadequate, thereby limiting the fund’s ability to deliver on its mandate of providing financial resources for SMEs.

He indicated that since 2010, the Trust Fund has investments in 11 VCFCs which have also gone ahead to invest in 70 companies.

SME Round Table discussion

As part of efforts to assist businesses thrive after its recapitalization, the VCTF is collaborating with the Association of Ghana Industries (AGI) to create awareness on alternative sources of funding for SMEs.

“VCTF as part of our mandate has decided to create awareness and update knowledge about the kind of alternative funding venture capital/private equity offer to businesses especially SMEs and Kumasi is our first stop. We decided to do this in collaboration with AGI because of the role they [AGI] play in the Ghanaian economy”, he said.

Chairman of the Association of Ghana Industries for the Bono, Ahafo Bono East and Ashanti Regions, Kwasi Nyamekye encouraged members of the association and other SMEs and startups to patronise VCTF, saying it gives borrowers ample time repay their loans, in addition to capacity building and other support systems.

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