Thursday, November 11th, 2021
South Africa may not be home to Silicon Valley, but it is home to a growing and ever-developing local tech environment. Significant strides are being taken to ensure that South Africa lends its own voice to the matter – so much so that investment is being courted both locally and internationally. Now, more than ever, local ideas have increasing room to become noteworthy and applicable solutions to the problems we face in this country and beyond.
In 1999 Mark Shuttleworth put South Africa on the global tech map when he sold his company, Thawte, to Verisign for $575 million (R3,5 Billion at the time) on the back of his brilliant solution to digital security certificates for e-commerce transactions. Since then however, very little has come out of South Africa to the world, in the form of new and scalable tech solutions.
The reason for this shortage may be a result of two elements: a high degree of solving only for South Africa instead of the globe and a limited venture capitalist market.
South African entrepreneurs are notorious for limiting their solutions to local problems. With a market of only 55 million people, the local market is minute and thus not sustainable over the long term, in comparison to the possibilities that lie in the rest of Africa and other developing countries in the world. Shuttleworth knew this and thus looked to develop a solution that to this day, remains valid in the world of e-commerce. As the world rapidly consolidates into a fully digital economy, more security solutions are going to be highly sought and there’s no reason that they shouldn’t come from here.
All good ideas however need funding to reach their full potential. The South African venture capitalist market is growing, but still has some ground to cover. Local entrepreneurs need to look to outside markets to attract investment, if the local funding market is too slow to respond to them. This can only happen however if the ideas address global or greater regional (M-PESA in East Africa etc) problems. Once again, if Mark Shuttleworth could attract foreign buyers in 1999, when the world wasn’t as connected as it is today, what’s stopping us now?