Making Cape Town a hub for tech, venture capital talent
Cape Town is becoming a hub for technology and venture capital (VC) talent, attracting professionals from Europe and Africa. This is according to Michel Weiss, founder and CEO, Counder Network.
Counder Network supports African startups, fund managers and entrepreneurs by providing fundraising and investment solutions. Next month, it will host an invitation-only Wine and Venture Summit, aimed at establishing and deepening trust between African entrepreneurs and investors and their European counterparts.
Speaking to ITWeb Africa, Weiss said his organisation is focused on building enduring relationships and is hoping to ‘dismantle preconceived notions, foster mutual understanding, and unlock substantial capital’.
He said: “Our journey in investing in the African continent began with our first German and South African startup, SEON, back in 2018.”
Weiss spoke of Cape Town's emerging status as a hub for tech and VC talent, which, he said, is attracting professionals from both Europe and Africa.
“This trend has positioned Cape Town as a burgeoning centre for innovation, reminiscent of the early days of now-established hubs like Berlin, Stockholm, and Silicon Valley.”
According to Weiss: “We've observed that top VCs, investors, and founders who visit Cape Town from cities like Berlin and Stockholm often draw parallels between Cape Town today and their cities in the early 2000s, just before their substantial breakthroughs in venture and tech.
“Norrsken22 for instance, a $200m growth fund for Africa, launched by Niklas Adalberth and Hans Otterling (one of Europe's most prominent VCs via Northzone), is a prime example as it also rooted in what they experienced in an ecosystem like Cape Town and connected it back to their success history in Stockholm, having built, invested in and exited tech giants such as Spotify, Klarna and iZettle.”
Mark Miller and his team of Carlsquare, a tech investment bank from Germany, are also in high anticipation of the summit as Carlsquare says it is very open to exploring and supporting Euro-African opportunities.
Weiss said South Africa’s tech ecosystem has potential but faces a few challenges. “Looking at Cape Town, for instance, you can see a massive increase in international interest from talent, to investors and VCs who love spending three months and more here during the summer.
“Yet we notice a lack of interaction between internationals and locals. Internationals often stay within their own groups, having limited engagement with the local startup and investment scene. We aim to break these social bubbles, facilitating meaningful connections between these groups, which we believe can lead to really strong collaborations and mutual growth, investments and returns.”
Weiss said that South Africa's restrictive visa policies and capital flow regulations hinder the international appetite. “We're addressing this through initiatives like the Startup Act, where I serve on the steering committee, advocating for more open policies, which are so essential for a thriving ecosystem.
“Comparatively, countries like Kenya and Rwanda are far ahead in creating conducive environments for tech startups and venture capital. Their progressive policies make South Africa's approach appear less competitive and can hinder the unfolding of various opportunities. It's imperative that South Africa takes the venture opportunity more seriously to not fall behind its continental peers.”
He called for South Africa’s government to make investing in the country easier and more attractive for internationals seeking to invest in the country and provide value.
In conclusion, Weiss said: “While our focus has been largely on VC and tech, we’re not overlooking the potential in more tangible industries like manufacturing, infrastructure, and energy. We have representatives from these sectors as well, recognising the diverse opportunities they present.”