This guide is intended as an explanatory memorandum surveying the current legal landscape and market standards in South Africa concerning impact investing as well as the current viable impact investment options. This guide will be useful to, amongst others, South African debt and equity investors, grant-makers, foreign investors, incubator/accelerator portfolio managers, small and medium enterprises and social enterprises. The guide examines the laws and policies governing impact investing in South Africa, as well as different types and sources of financing that can be accessed for impact investment, and introduces a term sheet and “dos and don’ts” in carrying out negotiations and drafting term sheets.

South Africa faces significant economic challenges, with youth disproportionately affected by high unemployment rates and limited economic participation. Townships, home to a significant portion of the unemployed population, are now focal points for addressing youth entrepreneurship as a solution. However, sparse data on township youth entrepreneurial activity hinders effective support strategies. This research indicates that proximity issues, such as isolation and lack of access to information, are key barriers for both youth entrepreneurs and business development support providers. Current support efforts often lack relevance and fail to target high-growth potential businesses. To improve outcomes, there's a need to shift focus towards reaching more youth entrepreneurs and tailoring interventions to their needs.

South African politicians frequently refer to entrepreneurship as a potential solution to the economy’s significant unemployment problem. In reality, many entrepreneurs need to come from townships. Numerous reports address challenges faced by South African entrepreneurs. What distinguishes this report from extant studies is that this report features the voices of entrepreneurs and entrepreneur support organisations (ESO) to vividly portray township entrepreneurs’ challenges through in-depth interviews. This report also aims to elucidate the factors that contributed to the success of exemplary township entrepreneurs despite existing challenges and other strategies that ESOs can employ to guide more entrepreneurs to emulate these success stories.