South African Endeavor Raises $8m To Fund Startups In South Africa
Endeavor South Africa, a community of high-impact entrepreneurs, has announced it raised $8m in its Harvest Fund II for South African startups.
A statement released by the organization has said that the fund which has already invested in six technological startups, with four more in the pipeline, will be fully invested by 2022.
Harvest Fund II is a rules-based fund with founder alignment for medium-sized, high-growth Endeavor Entrepreneurs. The funding process follows the terms of lead investors, assisting entrepreneurs in negotiating terms before joining the investment round on terms set by the lead investor.
According to the organization, 29 Endeavor, SA Entrepreneurs of the previous cohort have generated an additional 5800 employment, a 20% average increase each year.
The primary aim of the Harvest Fund II is to attract additional investors, accelerate timeframes, and lower costs for investors by leveraging funding from the US Agency for International Development (USAID).
Antonia Bothner, Harvest fundraising lead speaking said that the fund will have a direct impact on the tech ecosystem while funding entrepreneurs.
“Support from USAID enabled us to assemble a dedicated team to focus on the capital raise, accelerating investment timelines, and ultimately raise the fund with a direct impact on the ecosystem.
“What has been even more encouraging to see are the successful alumni entrepreneurs at Endeavor not only coming into the fund as anchor investors but also investing directly into the rounds of entrepreneurs on the program — demonstrating the virtuous cycle at work,” said Antonia.
“South Africa is fast emerging as a wonderful platform for high-tech entrepreneurs to experiment and test out their ideas, particularly given its varied cross-section of customers, distribution and product, as well as its sophisticated regulatory, financial, and telecommunication services backbone. Harvest Fund II is capitalizing on this development and investing in the companies that are seeing early successes,” says Herman Bosman, Endeavor SA chairman.
Andy Karas, USAID/Southern Africa Mission director has also added that the organization is seeing the potentials and benefits of investing in local businesses as it catalyzes economic growth.
“Private investment helps local businesses grow, creates jobs, and generates inclusive economic growth. The US government sees the potential of innovative approaches like Endeavor’s to visibly catalyze investment and sustainable growth at scale in Southern Africa — a region of great opportunity for entrepreneurs and investors alike,” says Andy Karas, USAID/Southern Africa Mission director.
Antonia Bothner also added that: “The same strong demographic trends that saw China, Brazil, and India advance, are now projected for Africa in the next decade. This, coupled with increased mobile penetration, data, and digital solutions, means there is an outsized opportunity [for tech companies] to grow and in a leap-frog fashion.
“We’re starting to see signs of more traditional players paying increasing attention to South African and African tech-based opportunities, and we’re cautiously optimistic about both the impact and the returns”.