- July 27, 2026
- Posted by: vitalclick
- Category: Venture Capital
South Africa’s venture capital (VC) ecosystem is showing signs of maturing, with new research indicating that successful exits are becoming more common while delivering competitive investor returns alongside measurable economic impact.
Two studies by the SA SME Fund, Endeavor South Africa and the South African Venture Capital and Private Equity Association (Savca) suggest local venture-backed businesses are increasingly generating exits comparable to those seen in more established VC markets.
The South African Venture Capital: Exit & Performance Analysis, which examined 226 realised exits between 2009 and 2026, found that realised cash returns ranged from 2.01x to 2.45x invested capital. The report concludes that South African venture capital has produced realised return characteristics broadly in line with more mature markets, including the United States, the United Kingdom, Europe and India.
A second study, Exit Case Studies Analysis, examined 18 South African venture-backed exits across 21 investment rounds between 2014 and 2026. It found a median gross internal rate of return (IRR) of 54%, a median gross money-on-invested-capital (MOIC) of 3.5x, and a median exit valuation of approximately R1.6bn.
Beyond investor returns, the companies studied collectively created more than 4,000 direct jobs, averaging around 230 jobs per business. The broader high-growth sector in which they operate recorded revenue growth of 256% and employment growth of 49% since 2021.
According to the organisations behind the research, the findings suggest South Africa’s venture capital market is moving beyond isolated success stories towards a more mature investment ecosystem capable of attracting greater institutional capital.
The reports also challenge the long-held perception that South Africa produces promising startups but struggles to generate venture-scale exits. While still relatively young by international standards, the local market is seeing larger exits, more diverse exit routes and several high-profile transactions.
Recent examples include Mastercard’s pending acquisition of BVNK, Motorola Solutions’ acquisition of RapidDeploy, Nedbank’s acquisition of iKhokha, Lesaka’s acquisition of Adumo, Ticketmaster’s acquisition of Quicket and Optasia’s listing on the JSE.
Ketso Gordhan, CEO of the SA SME Fund, said exits are critical because they recycle capital, reward investors and attract further 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,” he said.
The research identifies four primary exit routes now active in the local market: international mergers and acquisitions, domestic mergers and acquisitions, secondary transactions and initial public offerings (IPOs).
International acquisitions remain the most common exit route, although domestic acquisitions have increased, particularly in the fintech sector, as banks, insurers, retailers and listed technology companies acquire scale-ups to strengthen their digital capabilities. The studies also point to growing use of secondary transactions and public listings as additional liquidity pathways.
Fintech features prominently throughout the research, reflecting South Africa’s established financial services sector and the role of banks, retailers and telecommunications companies as both customers and potential acquirers of technology businesses. According to the report, more than half of Africa’s 20 largest fintech exits since 2019 have involved South African companies.
The studies argue that these businesses have contributed to financial inclusion by expanding digital payments, SME finance, remittance services and access to financial products for small businesses.
Savca chief executive Anusha Naidu said demonstrated exits are fundamental to the development of any private capital market and provide important evidence for pension funds, family offices, development finance institutions and other long-term investors considering venture capital as part of a diversified investment portfolio.
The research also suggests the strongest wave of exits may still lie ahead. More than 20 privately held South African high-growth companies have each raised more than $25m, while over 1,100 companies have received venture capital funding since 2016. With a median investment holding period of around six years, much of that capital has yet to reach typical exit maturity.