SA’s Tech Startup EcosystemFeb 4, 2018 Blog Funding Options , Tech Startups
Ventureburn published a comprehensive guide towards the end of 2017 for anyone who wants to get involved with or have a better understanding of the startup space. The have researched South Africa’s entrepreneurial landscape and hand-picked some of the top players to get one started. What follows is a summary of their findings:
Venture capital is about early-stage, high-potential, high-risk startups and the local sector invests millions of rands in deals here. Some of the companies involved here are Angel Hub Ventures, South Africa’s ‘first group of angel investors’, MonteGray, founded by Michael Jordaan, provides seed and capital growth, 4DI Capital, aimed at startup investment opportunities with big growth potential, Knife Capital, a growth equity fund manager, Business partner which funds startups in clean energy, biotech and ICT sectors, and a few more.
Thundafund, a marketplace for creatives and innovatoris, Uprise.Africa, South Africa’s first equity crowdfunding platform, and RainFin, South Africa’s first online lending marketplace lending platform, are mentioned as the examples of alternative funding options for startups.
South Africa has its fair share of wealthy individials with investment sense and some of the names mentioned in the article is Michael Jordaan, mike Ratcliffe, Vinny Lingham, Wayne Gosling, Daniel Guasco and Ernst Hertzog.
‘Private equity is about taking a company at later stage it its development and restructuring it to optimise its financial performance.’ Firms who made notable investments in tech startups specifically are Ethos Private Equity, Acorn Equity, Horizon Equity, Sasfin Private Equity and Kagiso Tiso, to name a few.
Government support and funding
The South African government is also supporting a range of entrepreneurial and innovation programmes in the country. The Department of Trade and Industry has various programmes, such as the Support Programme for Industrial Innovation and the Technology and Human Resources Programme. The Industrial Development Corporation provides finance for industrial development projects. The Innovation Hub was launched in 2110 with the aim of fostering social-economic development and competitiveness in Gauteng.
‘An incubator bring in an outside team to manage an idea that was developed internally and takes a larger chunk of equity in the resulting company. Examples of these are the Awethu Project which pioneers a new approach to identifying talented entrepreneurs in under-resourced communities. Bandwidth Barn, operating since 200, is one of the leading ICT business incubators in the world. Other examples are Impact Amplifier, The Innovation Hub, JoziHub and Nedbank LaunchLab to mention just a few.
Accelerators help businesses accelerate growth. They differ from incubators in that the programmes usually run for shorter periods, between three and six months.
Read the full article here.