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Q2 2023 - (released August 2023)

SA's quarterly Private Equity & Venture Capital magazine


“My journey does not look like me.”

by Puseletso Mbele

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“My journey does not look like me” is a quote from Sheryl Lee Ralph, an American actress who won her first Emmy award for Best Supporting Actress in a comedy series at the age of 66. She was the first black woman in 35 years to win the award.

This quote resonates with me because, as humans, we often marvel and admire someone’s success without being mindful of their journey and the number of times they’ve had to endure the word, “no”. In an industry where ‘no’ is wielded often, especially when fundraising, I am still surprised that I have managed to back myself and successfully partner with an international company, Moravia Capital Investments. 


We share similar values, strong enough for me to start Moruo Private Markets, a Private Equity Fund of Funds business. Our vision is to become the preferred provider for alternative investment solutions, both domestically and internationally, to the broader institutional market in South Africa. 15 years from now, when I look back on this adventure that my partners and I are embarking on, I trust that we will have contributed positively to strong yielding and impactful investment portfolios for the benefit of our investors and their underlying beneficiaries. 


Moruo is currently fundraising for a US$100m offshore Global Private Equity Fund that will have an allocation to North America, Europe, Asia and Africa, and I am proud to represent the first black female-led private equity business that provides local access to offshore private equity and alternative solutions.

With Reg 28 amendments increasing offshore limits to 45%, South African institutional investors now have an opportunity to allocate and diversify their current offshore investment portfolios from traditional listed assets by allocating to an asset class that has out-performed public markets over the long term. 

The experience of starting a new business has been challenging and exciting in equal measure. I’ve been very fortunate to have great women supporting me with empowering resources, from accessing working capital to securing office space, as well as connecting me with other like-minded women who are navigating the private equity ecosystem. Although women, especially African women, are still under-represented in this industry, we are not detracted by that fact. We are pushing forward and are focused on finding new solutions to old and systemic problems. 

One of the common challenges in Private Equity is fundraising. However, in South Africa, our challenge is exacerbated by the fact that there doesn’t appear to be a set framework that institutional clients can use when conducting due diligence on emerging Private Equity GPs, and with the “no one wants to be first” narrative, emerging managers often get overlooked. As a new manager myself, albeit in the Fund of Funds space, I believe that institutional investors and their investment consultants should think differently and be innovative when conducting due diligence on emerging managers. After all, research conducted by Preqin and some private equity industry bodies confirms that emerging private equity managers often deliver higher returns on an attractive risk-reward basis.  

I believe that the tools below can be beneficial to investors and investment consultants when considering allocating to emerging managers. Commonly, due diligence entails evaluating the team, track record, strategy, investment philosophy and processes. The areas in which I believe that due diligence can be enhanced are team and track record, and so these will be my focus. 

Institutional clients can consider assigning different metrics to emerging managers, instead of putting them all in the same bracket. For example, there is a significant difference between a team that has worked together for over 10 years, managing a fund and then ‘spinning out’ to form their own fund, maintaining their investment philosophy and the processes that they know, as opposed to a group of individuals who come together but have never worked together. Understanding the value systems and synergies of the team and their technical competencies is also key. Therefore, these managers need to be analysed differently. 

Track record
Institutional clients can conduct an attribution analysis to assess the emerging manager’s private equity capabilities. This can be done by reviewing previous deals conducted by the team members in previous portfolios, to understand how much they contributed to the performance of that portfolio from a deals perspective – as opposed to ignoring the emerging manager’s experience altogether. The years of experience that the emerging manager has should also be considered. The common view is that a minimum of 10 years’ investment experience is required for a private equity manager to acquire the necessary skills in deal origination, evaluation, execution and implementation, value creation and maximising deal returns. This can be an added component for institutional clients when conducting due diligence on an emerging manager. 

I am of the view that the above will give institutional clients a different perspective, and hopefully assist them when deciding to allocate to emerging managers. Overlooking this type of manager is not ideal, especially from an ideas generation perspective. If we are to promote innovation, it makes sense for institutional clients to have a different perspective when making allocations that will yield positive outcomes for their constituencies.  

Mbele is CEO & Managing Partner of Moruo Private Markets.

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