There is still US venture capital available for South African technology firms, but South Africans themselves need to take on general US ignorance about the country to be able to access it.
This was the message of Silicon Valley entrepreneur Ken Matusow, who addressed last night`s First Tuesday meeting.
Matusow is in SA for three weeks to explore the needs of South African IT entrepreneurs and the possibility of acting as a go-between to introduce entrepreneurs to Silicon Valley venture capitalists.
He says he is looking for interesting technologies with high value-add, particularly more challenging technologies such as digital television, "things that get the most bang for the buck".
SA is greatly under-represented in the US, Matusow says, even though Asia, Europe and even Eastern Europe are well represented.
"There is a market out there. There is no reason why SA can`t compete in Silicon Valley or elsewhere in North America," he adds.
He says people in Silicon Valley are concerned with one thing - return on investment (ROI). "They don`t worry about details, and they couldn`t care less about the devaluation of the rand if they can get ROI."
However, despite the fact that development and labour costs are substantially lower than in the US, and the fact that there is a good amount and quality of engineering talent here, in general there is a deep level of ignorance about SA.
"In general Americans barely know that SA exists. The little they do know is the controversial things, like Zimbabwe and AIDS. Getting the truth out needs to come from all of you."
However, he cautions that on the surface it appears no one will touch SA except for funds specifically targeting Africa, and even those are reluctant to invest in start-ups.
"But you need to get the contacts now so that when things do turn, you`re there."
Matusow is scheduled to speak in Cape Town on 11 February.
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