Unanticipated investment setbacks in South Africa’s venture capitalist landscape, such as Naspers’s recent closure of its R1.4bn technology investment fund, Foundry, signal a sturdier decline in corporate backing for local startups.
Despite this, South Africa remains one of the major markets for global investment, with the African Tech Startups Funding Report released earlier this year highlighting that 633 African tech startups raised an impressive $3.3bn in 2022. Yet, 2022s total capital backing disappoints with no further increase compared to the previous year-on-year results.
Despite discussions around limited investment prospects amid the looming threat of a recession, South African startup founders maintain an optimistic outlook on the country’s socio-economic progress and remain committed to strengthening the entrepreneurial ecosystem.
This sentiment was widely shared at the recent Founders Den (9 March 2023), a community-based networking event coordinated by Cape Town based innovation agency Specno and its partners.
Events like as the Founders Den showcase the increasing influence of venture builders in forming significant social compacts in South Africa.
This is crucial in a nation where depending exclusively on the government to drive innovation is unrealistic, and the responsibility falls on entrepreneurs and early-stage businesses to secure funding for growth and scaling.
“As business owners, our goal should not be to compete against each other to see who can secure the most capital,” says Specno co-founder and CEO, Daniel Novitzkas. “Given that the government’s funding allocation plan is struggling to aid early-stage company growth, it’s crucial that we cheer each other on in raising capital. Doing so can demonstrate to investors the potential of the South African startup collective, which can attract more foreign investment.”
The rapidly advancing startup and venture builder has set itself an ambitious objective to assist one million entrepreneurs in launching and realising their business ideas by 2030.
The startup framework they are developing is being followed by thousands of entrepreneurs already, and over the last four years has led to the creation of over 100 startups – many of whom are venture backed.
Their occasional Founders Den is a unique gathering driven by members of the innovation community, providing a sense of involvement that caters to the specific needs of entrepreneurial enterprise owners.
The invitation-only event offers practical insights from experienced founders and opportunities to connect with potential talent, investors, and partners, shaping the example that is ‘social compacts in action’, and presenting a renewed opportunity to collaborate towards a shared objective.
Last week’s main discussion, led by Notvitzkas and OfferZen’s Philip Joubert, was followed by breakout sessions that encouraged idea-sharing among almost 100 business owners, industry experts, and investors, predominantly from the mobile and web applications sectors.
Key takeaways included learning to pitch to venture capitalists and legacy corporations, and discussing the process of scaling a businesss.
Participants were advised on corporate investment, addressing the ‘founder’s dilemma’, founder’s burnout, and the importance of adopting a global mindset for exploring international opportunities and understanding worldwide startup ecosystems.
“Developing a supportive structure for new and existing entrepreneurs involves creating a networking space where local founders can convene, exchange knowledge and experiences, foster communication about challenges and successes, and openly offer and receive advice on their respective business journeys,” says Novitzkas.
“We want to cultivate a culture where we can appreciate the differences between our local ecosystem and those of international structures, and build a supportive network of founders in South Africa that looks at mutual encouragement and assistance,” adds Specno co-founder and director, Jacques Jordaan.
Specno intends to announce a more frequent founders only meet-up schedule for 2023 and beyond.
The most recent gathering, held on March 9, 2023, was live-streamed and can be watched on their LinkedIn page.
