In what is probably the final round of its R475 million equity equivalency programme, Microsoft is looking for four to five companies to partner with, and is focusing on cloud and education solutions.
Microsoft SA MD Mteto Nyati says it has increased the maximum size of companies in the latest bid, as there are only five years to run in the programme. Microsoft wants more mature companies to take part so that its aim of globalisation can be achieved, he explains.
The software colossus this week opened a public request for proposal (RFP) process for new firms looking to become part of its equity equivalent programme, which was officially launched in March 2011. Entries close on 11 October.
The RFP is open to small, black-owned software companies across SA, with a maximum of 50 employees and a maximum turnover of R15 million a year. Microsoft initially started with four companies and then added another two before one dropped out because it no longer was empowered.
Nyati says one area it still needs to find partners for is in education. He says there is a big need for better education in SA, and Microsoft wants to be part of the solution, which is also a business opportunity.
Microsoft SA wants one or two partners in that space, says Nyati. He adds that cloud has also become a real opportunity and it wants to play more of a role in that space. "We really want to create global players."
So far, Microsoft has spent R93 million of the initial amount and Nyati does not anticipate increasing the pool of funds. He adds that Microsoft wants a pool of partners so that it can make sure it honours its promise to government.
Nyati says the programme is not aimed at providing start-up capital, but rather at turbo-charging the growth of existing companies that have potential.
Looking back
In March 2011, the software giant announced the first four companies with which it is partnering as the initial step in its seven-year equity equivalency plan, which analysts previously hailed as "unique".
Later that year, it added iSolve Technologies and Mmapro IT Solutions.
iSolv CEO Jayesh Nana says the company is now shifting its focus to international markets and is looking at Asia Pacific, Africa and the Middle East as targets. He says iSolv's ability to start looking at international markets is thanks to Microsoft's leg up.
Nana says its top line growth is around 30% a year and it has a good level of profitability. He notes that revenue growth is sufficient for the company to be sustainable.
However, without Microsoft's catalyst, the company would have taken between four and five years to get where it is now, notes Nana.
The company was set up in 1999 and moved into product development five years later. Nana says it was not growing rapidly, and only had nine staff, eight of whom were developers.
iSolv has been in the Microsoft programme for 18 months now, says Nana. In that time, the company has grown to 20 people, of which three-quarters are development staff, he adds.
However, it now also has a support team with five employees looking after sales, marketing, business development and financial management. He notes that these functions did not exist previously.
In addition, says Nana, iSolv aims to hire another three people this year. iSolv supplies solutions around public key infrastructure, encryption and secure communication.
Some of the funding from Microsoft has gone into necessary infrastructure, such as servers, networking, as well as testing and measuring equipment, says Nana. This has helped the company with its development efforts as it can now produce international-quality products.
Share
