The Youth Challenge Fund is a youth start-up support programme that intends to stimulate the establishment and growth of youth-owned businesses, promote digital skills, grow the economy and foster job creation. The primary objective of the programme is to provide support to promising young entrepreneurs intending to scale-up and growing their businesses.
It aims to stimulate innovative businesses in response to youth unemployment through both financial and non-financial support. The programme will offer non-financial support through Business Development Support services (BDS) and financial support through grant and loan funding. The programme will also provide post investment support customised Business Development Support based on the needs of the small enterprises.
SEFA isresponsible for administering the grant portion and manage the loan component. SEDA will provide pre investment support provided to youth owned enterprises, through assisting enterprises that are not investment ready, to address gaps identified and package their funding applications. Dream Team Capital assists with the necessary developments for South Africans to access the Youth Challenge Fund.
Youth Challenge Fund (YCF) Key Sectors
The programme focuses on two broad channels, where channel has a combination of vertical and transversal sectors.
Youth Challenge Fund (YCF) Qualifying Criteria
In line with National Youth Policy, the YCF will provide support to youth start-up businesses/enterprises that meet the following criteria:
•Are between the age of 18 to 35 years;
•Registered with CIPC and be prepared to register with SARS & UIF;
•100% South African owned;
•Are adequately involved in the day-to-day operation and management of the business with at least one or more of the members being full-time employees of the company, especially the majority shareholder or essential personnel/applicant;
•Prepared to participate in Business Development Support and mentorship (pre and post); and
•Commercially viable, sustainable and feasible business idea.
Youth Challenge Fund (YCF) Requirements
•Businesses must be within the Technology & Innovation Sector or the Other Products & Services Sector;
•Percentage of Budget for the Technology & Innovation Sector is 30%;
•Percentage of Budget for the Other Products & Services Sector is 70%;
•Total Allocation for Technology & Innovation Sector is R84.81 million;
•Total Allocation for Other Products & Services Sector is R197.89 million;
•Start-up Maximum per Enterprise is R2 million;
•Growth Maximum per Enterprise is R15 million;
•Start-up Blended Finance for Technology & Innovation Sectors is 40% grant / 60% loan;
•Start-up Blended Finance for Other Products & Services Sectors is 30% grant / 70% loan; and
•Growth Blended Finance structured as 20% grant / 80% loan.
For more information and assistance on the Youth Challenge Fund – Contact DTC!