While most start-up technology companies will struggle for funding, the number of companies applying for funding has not decreased.
“The entrepreneurial spirit is still strong in the country,” says Andrea Bohmert, Hasso Platner Ventures director.
He adds that over 300 applications received in the past 11 months were from companies in their initial stage - the idea stage.
Anthon Botha, director of Innovation Lab, says competition is stronger today than it was 10 years ago and the market is definitely becoming increasingly competitive.
Innovate to survive
“Companies are realising that they have to innovative, for survival and for market leadership,” says Botha.
He adds that, with the uncertainty which is a result of the global economic slowdown, companies are looking towards innovation to help their business fly.
According to Botha, there is a growth in innovation in the public sector. “Government has put emphasis on innovation and there are a few programmes with an orientation towards innovation. There is the National System of Innovation by the Department of Science and Technology and the National Council on Innovation.”
Most of these initiatives focus on technological innovation, and areas such as service and market innovation, otherwise known as software innovation, are often neglected, Botha notes.
“There is also a move towards open innovation. This is innovation which is not structured and often happens at grassroots level - grassroots in terms of natural capability out there. Also, there is a drive towards social innovation, which is the tendency to get communities involved.
“Innovation is alive, and it's increasingly becoming a strategic tool in companies.”
Getting listed
Technology companies haven't been in favour in recent years, says Lauren Czepek, business development manager at the JSE's AltX. “In the South African economy, the buoyant sectors are construction and retail, and technology has not been in favour. But it will return to favour soon.”
Czepek states that listings are really about the company itself. “It is about the individual company, its track record, growth and history. It also has to be the right thing for the company in terms of its lifecycle and also whether or not the market is right for listings. But what we are seeing at the moment is that a lot of people are not prepared to list.”
Currently, there are 11 technology companies listed on AltX, and this is a sizeable number, says Czepek.
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