Beyond the JSE: Inside South Africa’s R630bn private capital market

According to Business Day's coverage of the 27four Investment Management South Africa 2026 report, a substantial share of South African capital is managed outside listed markets. The survey of 102 investment managers, which reports R8.38-trillion in assets under management, shows R391.6bn in private debt strategies and R238.1bn in private equity strategies. Together these total R629.7bn, nearly 8% of surveyed assets, with private debt making up roughly 62% of the combined figure.

Private credit provides financing that must be repaid, while private equity acquires ownership stakes. The report finds significant concentration within private credit: the four largest funds account for approximately 90% of the exposures examined, and the largest alone for about 52%. Eighty percent of managers in the detailed analysis identify established small and mid-sized businesses as their primary borrowers, although only 15% report average loan sizes below R15m. Managers report an average allocation of 89% to South Africa, 10% elsewhere in Africa and 1% to global markets, which links the sector's performance closely to the domestic economy.

In private equity, infrastructure equity accounts for 49% of assets but is pursued by only 35% of managers, while traditional private equity accounts for 30% of assets and is pursued by 62% of managers. Manager size varies widely: more than two-fifths manage less than R1bn, while 15% oversee more than R10bn. The median manager has R1.7bn under management against an average of R7.5bn.

Offshore investors have become major backers of private equity. Foreign investors accounted for 4% of fund commitments before 2010 and 39% for funds raised between 2021 and 2026, with offshore investors providing 49% of recent infrastructure commitments and 36% of traditional private-equity commitments in the latest period.

The report also highlights the gap in domestic institutional participation. Retirement funds held R3.65-trillion in assets in 2024, with 0.8% allocated to private-equity funds against a regulatory ceiling of 15%, according to Financial Sector Conduct Authority data cited in the report. The report frames the issue as one of trustee capability and governance rather than a mandate to raise allocations, citing risk, liquidity and valuation complexity as considerations within fiduciary duty.

The article notes that private capital cannot substitute for reforms needed to make South Africa investable, and that the sector's success should be judged by value created for investors, businesses and the wider economy rather than assets under management alone. The article was sponsored by 27four.