The year 2008 is an important year in the calendar of the Southern Africa Media Development Fund (SAMDEF). It turns 10 years this year. Looking back, SAMDEF has every reason to celebrate this milestone with pride and a clear sense of accomplishment. The fund’s model is unique in that it has been able to have an impact in the media sector that is regarded by mainstream financial institutions as highly risky. SAMDEF is neither a bank nor a venture capital fund, but resembles a hybrid of both models. There is no doubt that SAMDEF’s intervention has significantly transformed the media terrain in our region. The founding Chief Executive Officer (CEO), Methaetsile Leepile, recalls the fund’s conception and how perseverance paid off : “It was at a critical point of the negotiations with a funder when a hard-nosed, uncompromising financial consultant hired to scrutinise the proposal looked me straight in the eye and bluntly told me that the project was not viable and he would never recommend the donors to fund such a project.” SAMDEF was established in 1998 to offer development financial assistance to diverse, independent and sustainable media organisations in the region in response to the Windhoek Declaration of 1991, which required the promotion of an independent and pluralistic African press. SAMDEF is owned by the MISA Trust Fund Board. This decade-long journey has not been easy. Many challenges were experienced and lessons learnt. For instance, in May 2001, a decision was made to change the business model to address the inherent contradiction of giving commercial loans on one hand, whilst providing financial grants and free services on the other. This model undermined SAMDEF’s ability to collect its loans. The grant and management-training components of SAMDEF were therefore hived off to a new entity, the Southern Africa Institute for Media Entrepreneurial Development (SAIMED). One of SAMDEF’s investment strategies centred on investing in infrastructure such as printing presses, which could be accessed by a number of smaller players. This approach is based on SAMDEF’s objective of covering the Southern African Development Community (SADC) by investing in sectors of the media that are high-growth and capable of reaching larger audiences. Products and services Since its inception, SAMDEF has provided long-term finance to independent private media businesses in 11 countries in southern Africa, supporting over 25 projects. As of March 2008, the fund had a gross revolving investment fund of US$8 million in a portfolio that consisted of three main products: • A loan facility – US$5 million or 63 per cent • Loan guarantees – US$2 million or 25 per cent • Equity participation – US$1 million or 12 per cent The past financial year saw SAMDEF developing and exploring new products aimed at providing further assistance to the media sector. These include the following: • The newsprint paper revolving fund to exploit economies of scale by pooling the newsprint procurement for publishing companies in the region; • Supply of spares and maintenance of printing presses in the region through Consult Avenue (Pty) Limited, a SAMDEF associate company. Funding highlights and strategic partnerships • When SAMDEF was set up in 1998 two cooperating partners, namely the Open Society Initiative for Southern Africa (OSISA) and Communications Assistance Fund (CAF), now called Free Voice, provided start-up funds to the tune of US$110,000 and US$48,000 respectively. 44 Annual Report 2008