Here's to the next decade of tech start-up excellence
Technology / 8 November 2019, 1:15pm / Wesley Diphoko
CAPE TOWN - BIGEXIT, fintech, failure, success and impact are the keywords that define the past decade in the technology start-up world.
During this decade we witnessed major tech companies failing and closing shop. We also witnessed some great tech start-up success stories with founders who are still flying the tech start-up flag.
This decade was also marked by technology innovations that are truly making a difference in people’s lives. This edition, titled Decade of Tech Start-ups, of The Infonomist column shines a spotlight on the technologies and tech start-ups that shaped the past decade between 2010 and 2019.
In the tech start-up world starting a company and selling it for a sizeable amount or an exit is the ultimate goal. Two local fintech and edutech start-ups completed historical exits by South African standards.
Fundamo, a fintech start-up that was hatched at Sanlam laid the foundation for the decade through its acquisition by Visa. In June 2011, Fundamo was acquired by Visa for $110 million. Fundamo built one of the worlds most advanced and sophisticated mobile financial service platforms.
The platform was deployed in more than 34 countries across Africa, Asia and the Middle East, offering mobile financial services to unbanked and underbanked mobile subscribers including person-to-person payments, bill payments, wireless airtime top-up and ticketing. Fundamo became a pioneering company of the fintech industry in South Africa.
The Fundamo big exit story was followed by an Edutech start-up exit story. In 2017, an educational technology start-up, Get Smarter, was acquired by 2u, an international educational technology company, for $100million (R1.48billion). At the time it became the first company to be acquired by 2u in its quest to build a global edutech company.
Acquisition of a South African technology start-up for this amount served as an indicator that a local tech start-up eco-system can develop technologies that solve global challenges.
This decade also had its share of tech start-up success and failure stories. In 2012, South African dreams of developing the country’s first electric vehicle, Joule, were dashed as the tech start-up behind the project folded. Joule was an electric five-seat passenger car by Optimal Energy, a South African tech start-up based in Cape Town. Although Joule was folded, it was an important step by South Africa to manufacture an automobile.
One of the biggest tech names to join the South African tech start-up cemetery in the last decade is one Stellenbosch founded company, Mxit. What was then considered to be the biggest instant messaging platform in the country became a victim of tech developments such as WhatsApp.
In the history of Mxit users, 2015 will forever be remembered as the sad moment for millions of users of this African tech giant. Mxit was officially closed down in 2015 and its intellectual property handed over to a trust.
While Mxit was busy dying, another group of tech start-ups were emerging. These start-ups were inspired by the Uber phenomenon. One such tech start-up was SweepSouth. Since 2014, SweepSouth has become the Uber of cleaning services in South Africa. It’s a tech start-up that was born out of a frustration with getting an assistant at home.
Alen Ribic and Aisha Pandor poured their savings into launching SweepSouth, a platform where users can book cleaners. Today the application boasts revenue of over R100m and investments from some of the leading technology investors.
Towards the end of 2014, in October, another tech start-up, Yoco, that has proven to be successful was hatched. Yoco was founded by four friends, Katlego Maphai, Carl Wazen, Bradley Wattrus and Lungisa Matshoba, who shared a passion for smart technology and a desire to help small business.
Yoco has enabled entrepreneurs who had no means of payment systems to easily access the best technology available with ease. It has transformed how South African entrepreneurs enable payments in their own business. Yoco has truly enabled financial inclusion.
The company has grown to become a major player in the South African start-up scene, raising $23m in total funding, including a recent series B close of $16m.
Tech start-ups during this decade have also been impactful. One of the greatest tech solutions to emerge out of this decade is the Pelebox by Technovera. Pelebox is a simple wall of lockers, controlled by a digital system. Healthcare workers stock the lockers with prescription refills, log the medicine on the system, and secure each locker. Pelebox then sends patients a one-time PIN, which they use to open their locker and access their medicine.
A long queue at a health centre inspired Neo Hutiri to develop a digital platform that manages various internet enabled smart lockers. He started his medical technology company, Technovera, in 2016, to help patients on chronic treatment have a much more convenient experience taking care of their health.
Tech start-ups have contributed positively to the economy over the past few years. In the next decade more will need to be done by local tech start-ups. There’s only 10 years left to achieve National Development Plan 2030 goals and work towards solving some of its challenges outlined to truly make a difference.
* Visit BR online to learn more about tech start-ups that shaped a decade.
Wesley Diphoko is the Editor-In-Chief of The Infonomist. You can follow him on Twitter via: @WesleyDiphoko