AfricaFlame Flavors — Funding Requirements and Use of Proceeds
The total investment requirement of ZAR 7,550,000 will be funded through a combination of equity investment and term loan financing, structured to balance investor returns with sustainable debt service obligations.
Section 12 · Business Plan
Funding Requirements and Use of Proceeds
The total investment requirement of ZAR 7,550,000 will be funded through a combination of equity investment and term loan financing, structured to balance investor returns with sustainable debt service obligations.
Funded 30% founder equity (ZAR 2.265 million), 30% investor equity (preference shares, 38% target return) and 40% term loan.
12.1 Capital Structure
The total investment requirement of ZAR 7,550,000 will be funded through a combination of equity investment and term loan financing, structured to balance investor returns with sustainable debt service obligations.
| Funding Source | Amount (ZAR) | % of Total | Terms |
|---|---|---|---|
| Founder Equity | 2,265,000 | 30% | Sweat equity + cash contribution |
| Investor Equity | 2,265,000 | 30% | Preference shares, 38% target IRR |
| Term Loan | 3,020,000 | 40% | 5-year term, Prime + 2.5%, monthly repayment |
| TOTAL | 7,550,000 | 100% |
12.2 Use of Proceeds
All funds will be deployed during the pre-opening phase (Months 1–12) and the initial operating period (Months 13–18). A detailed drawdown schedule will be provided to all investors, with monthly reporting on actual expenditure versus budget.
12.3 Investor Returns
| Return Metric | Base Case |
|---|---|
| Target IRR (5-year) | 38% |
| Payback Period | 3.2 years |
| Multiple on Invested Capital (MOIC) | 2.8x |
| Cumulative Dividends (5 years) | ZAR 2,250,000 |
| Projected Exit Value (Year 5) | ZAR 31.8M (5x EBITDA) |
| Investor Share of Exit Value | ZAR 9.54M (30% equity) |
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