On Friday last week, 10 October 2014 I attended what I consider to be one of the biggest START UP Conference in South Africa if not Africa. Everyone in the startup scene was there, from Vinny Lingham, Michael Jordaan, Lebo Gunguluza and the rest were there to share their views and insights on what can make South Africa a #START-UP Nation.
My observation based on presentations and conversations at the START UP:SA Conference is that, South Africa is the Toughest Place To Be A Startup, here’s why and what I think should be done to make South Africa the Best Place To Be A START – Up:
According to Prof Baets who is the head of the University of Cape Town Graduate School of Business all that is needed to develop more start-up’s is business education.
Currently South African academic institutions are not structured to develop entrepreneurs but employees. A few academic institutions that try such as UCT GSB are stuck in old model of developing MBA Graduates who in most cases do not start businesses but instead run and lead big corporates. The environment in academic institutions does not encourage entrepreneurship and job creation but employment and job seeking.
According to Mr Michael Jordaan (a former CEO at FNB and now a venture capitalist) who was part of the panel at SIMODISA Conference, universities need disruption.
I agree with this view and in my view in South Africa there’s a need for a START-Up School similar to the Y-Combinator which funds and produces startups on completion of an education programme focused on creating a business.
One of the panelist who shared a story of their startup – BOZZA, when asked about how she financed her business her response was through bootstrapping. Building a company from personal finances or from operating revenues of the new company seems to be the way to go. The reality is that to access venture capital funding is not easy and when you do it binds you to contractual agreements that are not always favourable to the entrepreneur.
In my view START Ups should crowdfund their way into starting their businesses. ThundaFund is one key platform that can enable entrepreneurs to access funding from true supporters.
The Simodisa General Manager described a sad scenario of an ordinary South African START-up who struggles to START a business due to government regulations. He also shared a story of some successful interventions by SIMODISA to change some government regulations such as the tax regime changes.
FNB also shared their interventions in making the business registration process easier for entrepreneurs.
My view is that entrepreneurs should never allow government regulations to stop them from starting their businesses. Government regulations will always be there and therefore entrepreneurs should push ahead and find all sorts of solutions to deal with government regulations.
My overall observation of the South African START-Up scene is that South African entrepreneurs are bold and courageous. South Africa has nurtured some of the leading entrepreneurs in the world such as Elon Musk, Herman Mashaba, Vinny Lingham and Mark Shuttleworth. Entrepreneurs should never view tough conditions in South Africa in the negative light but as stepping stones to becoming successful in business.
At the same time there’s a need to stop viewing Silicon Valley as the next best thing that needs to be imported to South Africa. Startups in South Africa need to embrace local conditions and build unique solutions that will make a difference in the world.
The team behind the START-Up:SA from SIMODISA has done a sterling job of bringing together the START-Up community in South Africa.
As for me, I will be contributing towards building a START-Up nation in South Africa by dedicating some of my time making iDEATE a platform to showcase South African startups.
I invite you to share your stories in the START Up journey to inspire others and make South Africa-the Best Place To Be A StartUp.
* The views expressed here are not necessarily those of the owner of Ideate.