Why South Africa is an African tech trailblazer

MEST, Monday October 3rd 2011

In our efforts to give an overview of interesting phenomena in the African tech space we continue our tour in the south. While doing my research for this post, I came across many interesting new ideas, which I will summarize in two blog posts. In this first post I'll try to highlight some of the companies and people that have driven and shaped tech developments in the past. In the next post I will feature some of the rising stars and take a look at what’s in the future.

South Africa is commonly known to be the gateway to the African continent for many Westerners. Here you find everything, rural societies and high tech companies, history and future, all cramped together in one “Rainbow Nation”. I had the chance to speak with Athan Al Malambo, founder of South African web development firm Mycoza and CEO of South African entrepreneurship portal, Afriversity about the prospects and pitfalls for the South African tech industry.

The History
“South Africa is unique in Africa due do its incomparably dynamic history”, Athan says. Before the end of Apartheid in the early nineties a majority of the population didn’t have access to most employment and business opportunities. After 1994, the entire population suddenly found itself competing for the positions and the markets that the small elite had previously enjoyed the exclusive privilege to. The new generation of young entrepreneurs in South Africa has realized they have to work harder, be more ambitious and hungry to survive against the competition. This attitude, together with the decent-sized home market for South African entrepreneurs has created some confidence amongst entrepreneurs and a healthy competition among startups.

Some success stories:

The South African youth are aggressive! Take Jason Elk for example, CEO and founder of Zoopy, (a mobile web video content site). He and his co-founder, Gerry Da Silva, bootstrapped their company and managed to stay true to their vision of distributing South African mobile content until Vodacom bought into the company for 7 million Rand, getting a 40% stake. Individuals like these are the product of an environment, where slowing down and relaxing will inevitably lead to failure.

In the early days of the internet, Mark Shuttleworth launched an IT-consultancy out of his home in Cape Town and in 2000, he founded HDB Venture Capital. A true visionary Mark, was the first African in Space, when he embarked on a self-financed spaceflight. It’s the same visionary who a couple of years later founded the legendary open source operating system Ubuntu, a project to create a user-friendly Linux desktop free of charge to the masses. Currently with less than 20 million users Mark has set the goal of having as much as 200 million in 2015. Mark Shuttleworth was recently listed as one of the top 10 most powerful young Africans, I guess if anyone can do it its him…

Cape Town has established itself as the tech hub in South Africa in the past year. On the front lines of this development is, an organization founded by Vinny Lingham, a South African internet entrepreneur and the founder and Executive Vice-Chairman of the successful San Francisco based Web 2.0 start-up Yola.

While one of the big factors driving Silicon Valley is supply of capital, Silicon Cape is more of a movement, Athan concludes. The organization is driven by an active community of entrepreneurs and investors, who form groups and organize events to learn from each other and to grow their businesses and the industry. Vinny’s vision is to support a South African based software industry targeting markets worldwide. Yola is a good example, founded with 900,000 Rand and, incorporated in SA but expanded quickly to the US market and raised additional capital.

Next week we will look deeper into the South African tech startup space, and give some hints as to what to look out for in the future…