Capital Raising in Europe for South African Investors

South Africa’s private equity market remains one of the most compelling globally, defined by its relative youth, vibrancy and scale of opportunity. However, as highlighted during Jersey Finance’s funds-focussed roundtables in Cape Town and Johannesburg, the challenge is not the opportunity itself, but access to the capital required to realise it. 

Hosted by Jersey Finance’s Head of Funds, Elliot Refson and Market Development Consultant -Africa, Dr Rufaro Nyakatawa, the discussions brought together senior financial services professionals from Jersey and South Africa to explore how capital raising dynamics are evolving.

The roundtables focussed on four key themes including the European investor landscape, the emergence of new capital pools, structuring considerations and why these trends are increasingly relevant for South African managers.

European investors have deployed more than $1 billion into South African private equity over the past three reported years, according to SAVCA data and this figure is expected to grow. The discussion therefore centred on how South African managers can access this capital more effectively as its composition continues to evolve. (SAVCA PE Survey 2025)

A key takeaway was that European investment into South African private equity remains significant and concentrated but is increasingly characterised by two distinct trends:

• First, a post-Brexit shift has seen the UK government and British International Investment redirect focus on Southeast Asia and India, alongside climate and strategic priorities. Second, domestic economic pressures, including inflation, rising interest rates and performance constraints, have led UK investors to reduce exposure to emerging markets.
• By contrast, mainland European capital has remained consistent and is largely driven by a relatively small group of development finance institutions and investors. For managers, this provides clarity that while the opportunity is real, access depends on targeted engagement with a defined investor base.

SAVCA’s survey also shows that 64% of all funds invested in South African private equity originate from outside the country, with Europe and the UK historically accounting for a substantial proportion. However, mainland European investment has remained broadly stable, while UK investment has declined sharply in recent years, materially impacting overall fundraising outcomes.

While institutional capital remains important, the discussions highlighted a more structural shift taking place beneath traditional reporting frameworks.

Over the past 18 to 24 months, there has been an accelerated decline in institutional allocations to alternative assets globally. This has been offset by growth in smaller, more bespoke investment structures, often outside traditional fund formats.

High-net-worth individuals (HNWIs) hold a significant proportion of global assets under management but remain underrepresented in allocations to alternative investments. This imbalance is beginning to shift, creating a growing opportunity for managers seeking new sources of capital.

Importantly, this investor base is changing how capital is deployed. Rather than relying solely on pooled fund structures, private wealth investors and family offices are increasingly seeking direct and tailored exposure through co-investments, single asset vehicles and fund of one structures. Control and visibility over investments are key considerations.

Roundtable participants also noted that while family office capital can offer flexibility and speed, it can introduce execution risk. Experiences shared during the discussion highlighted that commitments may not always materialise in the same way as institutional capital, requiring careful management.

Alongside this shift, a recurring theme was the need for greater education and advisory support across the wealth management ecosystem. Many wealth managers remain product-focussed and may have limited exposure to private markets, while newer sources of wealth, including next-generation and entrepreneurial investors, are increasingly allocating to alternatives without always accessing specialist advice.

This points to a broader advisory gap across parts of the African market, particularly in areas such as product understanding, risk communication and portfolio construction. Addressing this gap will be important in supporting the continued growth of private market.

A consistent theme throughout the discussions was that structuring is no longer a secondary consideration but a central component of successful capital raising.

European investors may reject certain jurisdictions or require additional due diligence, which can delay or prevent investment. As a result, jurisdictional choice can directly influence whether fundraising discussions progress.
Two primary routes to accessing European capital were outlined:

• Establishing fully compliant EU structures.
• Utilising jurisdictions outside the EU that provide access through National Private Placement Regimes (NPPRs).

For many South African managers, the latter offers a more streamlined and cost-effective approach.

The discussion also highlighted that flexibility in structuring is increasingly important. Managers are expected to accommodate a range of investment approaches, including co-investments and bespoke vehicles, in order to meet evolving investor preferences.

At the same time, liquidity considerations are becoming more prominent. Private equity markets are facing exit challenges globally, while strong public market performance has provided a competing source of returns. As a result, investors are showing greater sensitivity to long lock-up periods and are increasingly questioning traditional fund timelines.

In response, there is growing interest in more flexible approaches, including evergreen structures, co-investment opportunities and strategies with shorter duration profiles. Liquidity is therefore becoming an increasingly important consideration alongside returns in investment decision-making.

Closely linked to structuring is the need for flexible fund vehicles.

The Jersey Private Fund (JPF) was highlighted as a practical solution developed through collaboration between Jersey’s finance industry, government and regulator. With more than 1,500 established since their launch in 2017, it offers a streamlined approach to fund formation, with the ability to be launched quickly and structured in a variety of ways.

Its flexibility allows it to be used for a range of purposes, including as a primary fund vehicle, a co-investment structure or a single investor arrangement, aligning with the needs of both institutional and private wealth investors.

The discussions also reinforced the strength of the existing relationship between South Africa, Jersey and European capital markets.

Jersey supports around 80 funds originating from South African promoters, representing approximately $35 billion of assets. It also has a long-standing role in supporting South African private wealth, alongside the presence of South African institutions, managers and family offices.

This established connectivity between South Africa and Jersey and between Jersey and Europe, provides a tried and tested operational route for capital raising.

The roundtables concluded that, despite recent fundraising challenges, Europe remains a significant source of capital for South African private equity.

While institutional investment continues to play an important role, the most notable shift is the growing influence of private wealth and family office capital. At the same time, the infrastructure and mechanisms required to access this capital are already in place.

For South African managers, the opportunity is not simply about identifying capital, but about aligning with how that capital is evolving. This includes engaging with a more concentrated European investor base, adapting to increasing demand for tailored investment structures and responding to greater expectations around transparency, education and liquidity.

Against this backdrop, Jersey’s established links with both South Africa and European markets, combined with its flexible and strong regulatory framework, position it as a practical and proven conduit for capital raising. As global allocation strategies continue to shift, those managers who are able to navigate these dynamics and leverage established international pathways will be best placed to access capital and support long term growth.