South Africa’s Grindstone Accelerator rolls out early-stage VC fund 

South Africa’s Grindstone Accelerator rolls out early-stage VC fund 

South Africa-based business accelerator, Grindstone has rolled out early-stage venture capital fund dubbed, Grindstone Ventures that grants equity funding to its cohort companies.

Grindstone Accelerator is a structured entrepreneurship development programme which is owned by both venture capital fund manager Knife Capital and market access specialist Thinkroom Consulting.

The programme supports South African SMEs with proven traction through an intensive year-long review of their strategies and helps them with the needs to build a foundation for growth to become investable, sustainable and exit-ready.

However, the structure of Grindstone Ventures is set to invest up to US$290,000 per opportunity in scalable innovation-driven ventures in co-investment arrangements with angel investors and corporate VCs.

Partner at Knife Capital, Andrea Bӧhmert said, “Linking a funding vehicle to our accelerator model complements the Knife Capital value chain approach where companies can be de-risked before raising follow-on capital from our Series A and later-stage funds. The Grindstone programme is essentially a thorough due diligence exercise to identify the best opportunities – already narrowed down from hundreds of applications.”

To add on, all future Grindstone Accelerator cohort companies will have a stake in Grindstone Ventures, hence creating a vested interest in each other by a community of high-growth scale-ups.

“A few of our past Grindstone entrepreneurs have subsequently exited their businesses and became VC Investors with Knife Capital. We are now starting to teach our investee companies to think like investors early on – because we back them to succeed,”  Bӧhmert further stated.

Partner at Knife Capital,  Keet van Zyl said, “The initial capital contributions are from Knife Capital, Thinkroom and our programme partners, but encouragingly, past Grindstone cohort entrepreneurs are coming on board and respected angel investors in the South African startup ecosystem are looking to invest. We already identified the first investment opportunities.”

The new Grindstone Accelerator cohorts 6 and 7 of ten companies each in Cape Town and Johannesburg respectively and will be announced soon.