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R6.5 Million Fund For Cape Innovators

Innovation in the Western Cape is set to get another healthy boost, with the announcement today (Friday, 14 October 2016) that designers, inventors, entrepreneurs and product developers can apply for grants of up to half a million Rands each from the second round of the Design Innovation Seed Fund (DISF).

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The DISF is a project of the Cape Craft and Design Institute (CCDI) with investment and management funds respectively provided by the Technology Innovation Agency (TIA) and the Western Cape Department of Economic Development and Tourism.

The Fund is inviting individuals and SMME’s in this round to apply with pre-revenue innovative technologies and tech-enabled ideas and products with the potential to positively impact the agri-processing, health and bio-tech, and the manufacturing sectors.

Launched in 2014 as a World Design Capital project, the first round of seed funding was allocated to develop 12 innovative Western Cape ideas. These 12 were selected from a pool of 151 applications.

The grants were used for a large range of activities, including developing prototypes, producing market samples, undertaking market research and investigating intellectual property rights. All of the beneficiaries have made significant advances in developing their innovations and have moved to the next stage where they are either prototyping, doing market testing with clients; or going to market.

The 12 participants are already proving the value of the investment with the registration of IP for three new products; the creation of 18 new jobs and a collective turnover of over R2.4m in the past six months from the early stages of marketing their new products/services. Three businesses are showing a market potential of over R7m collectively for the next twelve months.

Related: Uzenzele Holdings Unpacks The How And Where Of Business Funding

Erica Elk, Executive Director of the CCDI, said that the DISF has shown that the right funding at the right time put to the right use can have a tremendous impact on small businesses and help them turn ideas into reality.

”Ideas are a dime a dozen; everyone has them. But it’s a whole other story to be able to bring your ideas to life. It takes time and resources – not just money. It is a process that is full of twists, turns and challenges, and you need to be passionate, resilient and tenacious. The Seed Fund has given these innovators and entrepreneurs a little bit of breathing space and an opportunity to flex their muscles – which is all they really needed to take their next steps.

“More importantly though, we didn’t just give them the money. We walked beside them every step of the way over the two years providing support, advice and access to additional expertise when they needed it.”

She added that the DISF and other fund projects have enabled the CCDI to develop exceptional systems, capacity and networks to effectively manage funds, both in the design and other sectors. Another recent CCDI success has been the investment of R14.5m, over three years, made into 45 companies as part of its first Jobs Fund project.

These businesses collectively created 464 new jobs in the process doubling in size and turnover. These fund implementation successes have led CCDI to launch its own SMME investment vehicle, CCDI Capital, which will be managing the second round of seed funding and a second Jobs Fund project it hopes to launch later this year.

The DISF is open to: Western Cape based early-stage small and medium enterprises/entrepreneurs/researchers; Students at Western Cape tertiary institutions as long as the institution does not already have an Intellectual Property claim to the product/service; Pre-revenue businesses in incubation or entering incubation; or Existing SMEs with a new products/innovation that is still pre-revenue.

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Related: Now You Have Funding, Use It Wisely To Grow And Scale Your Business

Applicants to the DISF need to show enough evidence of innovation in design, technology and/or its application; market appetite or sufficient evidence of market potential or competitive advantage; and a management team able to drive the process.

The business, product or concept must have a knowledge focus and should include technological innovation or design. The business should not be able to raise funds easily from traditional banks or funding agencies because of the risks involved.

Strong preference will be given to businesses with at least 25% black ownership and/or good job creation potential. Entrepreneurs must match 20% of the funding in cash or in-kind contributions.

Saberi Marais, Head of Seed Funding at TIA, says that DISF has made a significant impact on the local early stage funding landscape.

“Seed funding such as the DISF assists recipients to inform their opportunities by building prototypes and validating their assumptions around the technical and market-related challenges. Entrepreneurs at this stage have traditionally faced challenges when it comes to access to funding. The other challenge that DISF helps recipients overcome is that of non-financial support and mentorship – this has also proven to be of great help to recipients,” said Marais.

Marais added that partnerships such as this one with the CCDI and DEDAT are extremely valuable. “Now that the model and partnership has been demonstrated to work, we have to focus on ramping the potential impact the programme could have in relevant economic development sectors locally. We need co-funders and follow-on-funders to come onboard and support the entrepreneurs who have commercially feasible opportunities.”

Related: Gearing Up For Funding Applications: What Does It Take For A Small Business To Be Funding-Ready?

Alan Winde, Western Cape Provincial Minister of Economic Opportunities, said that innovation was a key economic enabler.

“As the fourth industrial revolution starts to shake up the world, we need to embrace innovation in our approach. That is why we support initiatives like this fund. Some of the businesses and ideas developed through the first DISF have the potential to go global.

“We have an ecosystem taking shape here at the southern tip of Africa because of programmes like this, because of the environment we are in, and because of the mindset of young people coming into the system. I encourage every person with an innovative idea in the focus areas to apply. This is an excellent platform to take your idea or business to a new level.”

Applications close on 04 November 2016. Visit www.ccdicapital.co.za to apply.

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Be 1 Of 3 High Growth Scale Ups Sponsored By FNB & Vumela To Participate For FREE In 10X Accelerator Program (Value Of R650 000)

FNB and Vumela are sponsoring 3 high growth Scale Ups on the 10X Accelerator Program, kicking off in February 2018.

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The 10X Program has received amazing reviews and huge interest, because of its unique approach:

  • Focused on businesses that are Scaling Up (past the start-up / typical Accelerator phase)
  • Business Scale Up focus, not capital raising / exit focused
  • Broad company-building focus, not a narrow technology commercialisation focus
  • Addressing the gnarly and complex issues that come with growth, like hiring, firing, performance managing, management systems, Boards, etc
  • 18 months of intensive, hands on support
  • Working with seasoned Scale Up leaders

Here’s what delegates are saying:

“We’ve grown really fast, but without the 10X Program we probably wouldn’t exist anymore because things were starting to break… It’s a game changer… Unlike most other workshops like this I have experienced, 10X-e combines theoretical concepts with real world applications so that I can make immediate changes to my business. The tools are easy to execute throughout my organisation and get the needed buy in from my management team. We now have every staff member fully aligned to the company’s strategy… we’re now scaling much faster and with less resources than we would have normally required without the 10x process…. – James Wilkinson, Founder, Sonic Telecoms

Related: Expansion Funding Options For Your Growing Business

“Within 1 month I doubled sales revenue, because it became so clear I had 2 people in the wrong roles. We swapped their roles and doubled revenue immediately.” – Richard Rayne, Founder, iLearn 

“I used to feel like I was sprinting up a sand-dune. If I stopped sprinting for a moment, the business would slide downhill. But since the program, we have much more momentum and its not all up to me because the entire team is pulling together in the same direction. Things won’t grind to a halt if I am away for 2 weeks” – Andrew Cook, Founder, Smoke Customer Intelligence

‘The [10X Strategy Workshop] process gave us the framework to focus and say no to distractions … [key] part of our journey to drive relentless focus. The Workshop catalysed us working on our business and not just in it… [and] supported a period of advancement… and scale’. – Brad McGrath, co-Founder, Zoona

‘The upfront Path To Scale Boot Camp… got us all thinking the same way and on the same page about how to Scale. It is something we have carried with us and that has guided us ever since.’. – Aisha Pandor, co-Founder, SweepSouth

The Program is worth R650k. FNB & Vumela are sponsoring 3 qualifying Companies.  Seats will be awarded to businesses with the greatest Scale Up potential.

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R33 Million Boost For Job Creation And Innovation In SA

The Craft + Design Institute (CDI) has launched R33 Million in funding to boost SME growth, job creation and innovation.

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The CDI has raised the R33m to establish three funds – a Growth Fund, an Innovation Fund and a Loan Book – these funds will be managed by its investment arm, CDI Capital.

The funding will be for developing 60 growth oriented SME’s and 20 innovative technological solutions – and to create 600 permanent jobs in the process over three years.

This funding has been enabled by the National Treasury’s Jobs Fund through the Government Technical Advisory Centre (GTAC), the Technology Innovation Agency (TIA), and the Western Cape Department of Economic Development and Tourism (DEDAT).

CDI Capital was specifically incorporated as a CDI subsidiary in 2016 to catalyse funding for SMEs. A level 1 B-BBEE company, it aims to combine government grants with corporate Enterprise Development spend and private funds to de-risk investments in SME’s to stimulate growth and returns.

Related: 3 Things You Must Have In Place To Get That Start-up Bank Finance

The Growth Fund is open to businesses with turnover or assets of more than R1m with the ability to create permanent jobs. Applications open on the 27th of November and close on the 31st of December 2017. For specific criteria and more information on the grant please visit www.cdicapital.co.za/GrowthFund

The Design Innovation Seed Fund (DISF) is open to inventors who believe they have protectable innovative technological solutions that could impact on specific sectors and could create permanent jobs. This is the third round of this fund. Applications open on the 27th of November and close on the 31st of December 2017. For specific criteria and more information on the grant please visit www.cdicapital.co.za/DISF

In addition to the grant funding products, CDI Capital will also launch a R3.5m working capital and term loan facility at reduced rates for the duration of the three-year project to provide access to cash flow during the growth stage of these, and other qualifying SME’s.

 

The CDI has 16 years of experience in SME development and started supporting development in the craft and design sectors nationally in 2015. Signaling this change, the organisation changed its name in September from the Cape Craft + Design Institute to The Craft + Design Institute.

According to Erica Elk, Executive Director of the CDI, it was a landmark moment in the organisation’s history.

“Over the past few years our team has successfully taken our services across the country – we have conducted a business and product development workshop series in every single province and received incredibly positive feedback. The message clearly is ‘more please’.”

Elk said that there is a consensus in South Africa today that SMEs hold the solution to our intractable problems of a sluggish economy and high unemployment rates.

“In most countries, SMEs play a vital role as drivers of economic growth, innovation and job creation, but, in South Africa, this value is yet to be properly realised. To achieve this, the challenges experienced by SMEs need to be addressed. Namely access to markets, finance and credit, infrastructure, resources for R&D, and access to adequately skilled and work ready labour.”

She added that the CDI, through its specialised investment arm CDI Capital, is gearing up to provide solutions to some of these challenges, particularly in the craft and design sector and related sectors where design and innovation can catalyse growth.

“Our first Jobs Fund project, completed successfully in December 2015, had 45 participating companies creating 464 jobs off an investment of R14.5m. This was 105% of the target of jobs to be created. Participating SMEs grew their combined annual revenue by 73% over three years – from R60m to R104m. Funds were used to improve their products, processes and competitiveness through the acquisition of new machinery or specialist staff, and to expand local and international market reach.”

“We also completed a first round of DISF grants in 2016, and are currently working with seven innovative SMEs in round two – round one attracted private funding of over R10m in equity funding into some of the high-potential innovators. The DISF gives innovators and entrepreneurs in the Western Cape an opportunity to get the finance and support needed to get their ideas to the next stages.”

“We have put a significant amount of work into developing these offerings, not only ensuring good governance and appropriate monitoring and evaluation measures, but realising real and sustainable impact with the businesses we support. We are excited to have raised R33m to launch this new funding for SMEs, and we thank our funders and supporters – we look forward to making meaningful investments.”

Related: 6 Great Tips For A Successful Shark Tank Pitch

“Now – having led the way with investment from the public sector – we would like to partner with the private sector to support and strengthen this initiative. We believe this project – which aims to catalyse innovation, support growth orientated SME’s and create 600 jobs – would be an ideal Enterprise Development spend opportunity. CDI would gladly partner with corporate growth orientated accelerators and mentorship programmes to further strengthen the support offered to the participating SMEs.”

 

Najwah Allie-Edries, Deputy Director General: Employment Facilitation within the Jobs Fund:

“The Jobs Fund supports this initiative in recognition of the critical role that SMEs play in creating a more inclusive economy and job creation and also because it will contribute toward CDI becoming a more self-sustaining entity. The aim of this initiative is to provide appropriate financing options to SMEs in the craft and design sector in order to catalyse sustainable growth which will result in attracting further investment into a sector that has often been neglected. The introduction of a revolving loan facility will not only ensure that over time more SMEs can benefit from access to finance, the enhanced revenue streams will also contribute to the CDI’s goal of becoming a sustainable entity in its own right.”

Mr Vusi Skosana, Head: Technology Stations & IATs (TSP) at TIA, said that the Technology Innovation Agency (TIA), an agency of the Department of Science and Technology, was established with an objective to support the State in stimulating and intensifying technological innovation in order to improve economic growth and the quality of life of all South Africans by developing and exploiting technological innovations.

Solly Fourie, Head of Department, Department of Economic Development and Tourism, Western Cape Government:

“We know that there is a strong need to develop and improve the socio-economic conditions of the citizens in our region. To this end, the creation of a healthy and vibrant regional innovation system can be a catalytic driver of sustainable economic growth and development. But neither DEDAT, nor the WCG, are able to tackle this alone. The partnerships created through the Seed Fund and Jobs Fund; and initiatives like it, go a long way to creating an enabling regional innovation system in which we collectively draw on the Quad helix’s expertise and resources; promote local industry and attract and grow innovative businesses. By doing this, we are crafting the best possible conditions for businesses to develop in this region.”

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Start-ups Require A Strong Legal Foundation Webber Wentzel Ignite

Entrepreneurs, start-ups and scale-ups are a lifeline to South Africa’s economy.

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Entrepreneurs, start-ups and scale-ups are a lifeline to South Africa’s economy.  It is however a harsh environment and many entrepreneurs find themselves in a situation where they are wearing many hats and navigating potential pitfalls without the knowledge that many professionals have from years of experience.

This is especially true from a legal point of view where entrepreneurs are faced with real world regulatory challenges that could have far-reaching consequences on their fledgling business, such as financial regulatory, tax, exchange control and intellectual property.

A common example is that start-ups often forget to secure the rights and licenses they need to operate. For example, would you invest or partner with a company that:

  • doesn’t have a legal right to use their brand
  • doesn’t have proprietary technology; and/or
  • is reliant on a third party agreement that doesn’t permit commercial use?

Related: How To Raise Working Capital Finance

These avoidable shortcomings often result in failures at critical junctures. The specialist legal services needed to avoid these problems are typically not easily accessible to start-ups.

With this in mind, Webber Wentzel has launched a project called ‘Webber Wentzel Ignite’ – a legal incubation programme that will provide selected entrepreneurs and innovators from any sector with:

  • tailored legal services valued at up to ZAR 100,000;
  • bespoke mentoring and training support – focused on legal knowledge and developing key legal skills relevant to start-up businesses; and
  • targeted networking and profile-raising opportunities.

Video about Ignite

Webber Wentzel is not asking for equity or exclusivity; only an opportunity to connect and make a difference as a trusted advisor over the long-term. It is a wonderful opportunity that will set the selected entrepreneurs apart in the marketplace. Applications close on 15 January 2018

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