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Seed Fund from the Innovation Fund

Venture capital resources are very hard to secure for entrepreneur ideas and more often than not, our most exciting innovations are lost to overseas bidders. This restricts business growth in South Africa and prevents the country from becoming a world contender in business, science and technology. The answer was to provide seed venture capital to normal South Africans, keeping their ideas in the country and providing a platform for new entrepreneur ideas.

Contact us with any other queries.

Seed Fund Background

A 'funding gap' exists in respect of progressing technological innovations from ‘proof-of-concept’ stage to a position where there is a product or service that will attract industrial co-development or venture capital resources or investment. This results in Intellectual Property either never reaching its full potential or being lost overseas, with the consequence of employment opportunities being lost in South Africa. In response to this gap, the Innovation Fund which provides ‘proof-of-concept’ funding primarily via its Technology Advancement Programme (TAP), has established a Seed Fund to provide support for technology based projects and start-up opportunities that meet qualifying criteria.

For Seed Fund application and guidelines documentation, please visit the Downloads section.

Relationship to Venture Capital and Incubators

The Seed Fund intends to reduce the barriers experienced by other early stage funds to invest, especially in high risk, early stage opportunities such as TAP projects with commercialisation promise. Thus co-investment, or syndication, with these is strongly preferred. The Seed Fund does not compete with other venture capital resources, but strives to act in a synergistic fashion to facilitate early stage commercial uptake. It is therefore a ‘fund of last resort’, with a view to ensuring that strong opportunities are not lost to South Africa because they are too early and high risk for other early stage funds.

To this extent, the Innovation Fund builds relationships and co-investments with these entities. In addition, the Seed Fund does not replace, nor duplicate, the activities of existing privately and publicly funded incubators and technology transfer centres. The intention is to complement such initiatives with its seed venture capital offering. At the same time, the Innovation Fund is not mandated to provide funding to incubators. The Innovation Fund can invest in projects, entrepreneur ideas or companies that are otherwise associated with incubators, should proposals for funding meet the relevant criteria and be approved after the normal screening and approval processes.