New venture capital firm targets AI-focused start-ups
Cape Town-based artificial intelligence (AI) firm Cortex Group has introduced what it calls "Africa's first AI-focused venture capital (VC) company", aimed at supporting African start-ups.
Cortex Group is the holding company for AI software and solutions firm Cortex Logic. The group consists of six divisions, each focusing on key parts of the AI ecosystem: asset management, fintech, health, ventures, portfolio and logic.
The newly introduced VC body, Cortex Ventures, aims to serve as Africa's one-stop-shop for AI-focused start-ups and scale-ups seeking early or growth stage funding, according to the company.
As a call-to-action, it is inviting AI-focused start-ups and scale-ups to take part in its accelerator programme, Click-2-Pitch Challenge.
In addition to funding support, participants will be afforded the unique opportunity to tap into the Cortex Group's technical advisory, AI-application development capabilities and co-working space.
"The AI market is so large, that we decided it would be beneficial to create a venture capital company focusing on companies, innovators and entrepreneurs working with AI-based technologies; specifically leveraging data science, machine learning or deep learning in their stack," explains Dr Jacques Ludik, Cortex Group founder and CEO.
"The world of AI is recognising a global explosion of new companies seeking investment, and we intend to fill that gap; especially those seeking early stage funding, traditionally dubbed high risk by more traditional VCs and investment entities such as banks, angel or private investors."
The Click-2-Pitch Challenge, which is an on-boarding process for applicants, encompasses a simple application process, inviting candidate companies to submit and join Cortex Group's investment and advice programme.
Applicants will be reviewed by the investment team, which could lead to the opportunity to pitch for investment. Whether they are at pre-minimum viable product, a current minimum viable product at pre-revenue or post-revenue stage, the company says it will review all proposals and advise accordingly.
Dr Nick Bradshaw, Cortex Group CMO and director of Cortex Ventures, explains: "There has never been a better time to be a tech entrepreneur in the AI space. Things that could only be dreamt of two or three years ago are now possible.
"This includes access to free and cost-effective resources via open source, APIs and cloud providers such as Microsoft, AWS, Google and IBM, which are propelling these possibilities. As a VC, focusing on both early and growth stage businesses, we are supplementing the traditional support VCs offer with unique access to AI developers and data scientists, product advisory services, and a free co-working space. This will allow us to remain close to and continuously guide the companies and partners we are working with, ultimately ensuring their success."
Since 2016, the number of active tech hubs aimed at supporting technology start-ups across Africa has grown by over 50%: from 314 in 2016, to 442 hubs currently active on the continent, with dozens more expected to launch this year, according to research by the GSMA Ecosystem Accelerator.
African tech start-ups raised 53% more funding in 2017 compared to 2016, promoted by skills and development support received from tech hubs throughout the continent, it notes.
Lillian Barnard, MD of Microsoft SA, notes: "Embracing AI in SA is critical as it brings immense opportunity, and we anticipate it to be one of the most disruptive technologies in human history. Microsoft's latest research, into the adoption of AI in business, shows 37.8% of high-growth companies are actively implementing AI.
"It's great to see new players like the Cortex Group and Cortex Ventures helping clients shift toward digital transformation and creating new opportunities for the companies of tomorrow."