Hlayisani Capital secures initial capital for second technology investment fund

The Johannesburg-based firm will allocate the financial commitments to scaling South African enterprises operating in sectors such as artificial intelligence and financial technology.

Hlayisani Capital, a South African financial firm that invests in Small and Medium-sized Enterprises (SMEs), has introduced its second investment vehicle, the Hlayisani Venture Fund II. The fund launches with an initial commitment of ZAR 500 million, equivalent to US$ 29.9 million.

Hlayisani Capital focuses on bridging the financial gap between venture capital, which typically funds early-stage startups, and private equity, which involves investing in more mature companies. The firm provides capital and administrative support to businesses aiming to expand their operations internationally, create employment, and generate export revenue.

The initial capital for the second fund originates from institutional and private investors, with the Public Investment Corporation and the SA SME Fund leading the commitments. The investment firm is currently holding discussions with other potential institutional participants to secure additional capital. Hlayisani expects to reach the final close of the fund, the point at which no new investors are accepted into the vehicle, by June 2026.

Currently managing over ZAR 1 billion (US$ 60 million) in assets under management—a metric referring to the total market value of investments a firm handles on behalf of its clients—Hlayisani Capital directs its investments toward technology-enabled businesses originating in South Africa.

The new vehicle specifically targets Series A-stage companies. Series A refers to the first major round of business financing by institutional investors after a startup's initial seed funding. The fund requires these target companies to have established product-market fit, an economic term meaning the company has already demonstrated that its product satisfies a strong consumer demand. Focus sectors include artificial intelligence, digital infrastructure, financial technology, educational technology, and electronic health services.

The new fund has already allocated capital to three companies. The first is Tractor Outdoor Media, a business operating in digital outdoor advertising. Another recipient is Spatialedge, an artificial intelligence company that develops machine learning tools. Machine learning is a branch of artificial intelligence that allows computers to learn from historical data to predict outcomes, which Spatialedge uses to facilitate data-driven decision-making for enterprises. The third investment is in Cogitait AI, an organization that builds software systems designed to improve automation and operational data analysis for commercial applications.