The investment in Sourcefin aligns with HGDEF’s mandate to support high-growth, impactful businesses.
Sourcefin CEO Joshua Kadish
South African fintech company, Sourcefin, has landed R150 million ($8.3 million) in funding from Futuregrowth Asset Management. As part of its aim to empower small and medium-sized enterprises (SMMEs) and address funding gap for these businesses, the giant developmental investors showed their support for Sourcefin’s mission by investing through Futuregrowth’s High Growth Developmental Equity Fund (HGDEF).
Sourcefin made its entry into the African landscape in 2020 when Joshua Kadish, Avi Mishan, and Marom Mishan founded the company. Sourcefin offers financing solutions tailored to SMMEs’ unique needs, such as purchase order funding and invoice discounting. These services are supported by a proprietary technology platform that integrates financing with supply chain management and project support. By the end of its current financial year in February 2025, the company is ready to channel over R1 billion ($55.4 million) in funding.
Sourcefin’s platform serves as a meeting point for clients and over 2,000 verified local and international suppliers. The company possesses sophisticated technology that ensures operational efficiency and adequate risk management. By focusing on innovation, the fintech has been able to breakthrough bottlenecks like working capital restrictions and the rigorous procurement process.
South Africa’s SMMEs are constrained by a financial gap estimated at R300 billion ($16.6 billion). This issue is further exacerbated by the reluctance of traditional lenders to extend credit due to perceived risks. By supporting government-issued tender fulfillment and other procurement requirements, Sourcefin has been able to bridge this gap. Minority demographics, such as Black female-owned, youth-owned businesses, and rural-based entrepreneurs form over 90% of its client base.
Futuregrowth, true to its position as one of South Africa’s leading developmental investors, manages over R194 billion ($10.7 billion) in assets across more than 50 funds. Its investments span multiple sectors, including infrastructure, clean energy, and agriculture.
The investment in Sourcefin aligns with HGDEF’s mandate to support high-growth, impactful businesses. HGDEF has previously invested in several prominent companies, including fintech firms Yoco, Ozow, and Retail Capital (which was acquired by TymeBank in 2022), as well as health-tech startup hearX. Sourcefin joins this portfolio as a strategic partner, with Futuregrowth’s backing set to enhance its operations and expand its nationwide footprint.
“The SMME sector is vital for South Africa’s economic growth, yet traditional financing solutions often fail to meet their unique needs. Sourcefin’s technology-focused approach, coupled with their expertise in procurement and project management, offers a transformative solution.” said Amrish Narrandes, Head of Private Equity and Venture Capital at Futuregrowth.
“With the support from Futuregrowth, Sourcefin’s ability to scale investment into the SMME sector significantly increases. All R150 million will be deployed to reinforce the backbone of our economy.” said Joshua Kadish, co-founder and CEO of Sourcefin.
The partnership between Sourcefin and Futuregrowth shows a shared commitment to fostering economic growth and inclusivity in South Africa. With this latest investment, Sourcefin will be able to strengthen its position as a key enabler of SMMEs, resulting in job creation and innovation in a critical sector of the economy.
