The Technology Innovation Agency and Sedfa commit to invest in SA’s start-up and SMME ecosystem.
Two entities of the departments of small business and science and technology have joined forces, to create a more integrated and supportive environment for innovators and small, micro and medium enterprises (SMMEs) across SA.
The memorandum of understanding (MOU), signed by the Technology Innovation Agency and the Small Enterprise Development and Finance Agency (Sedfa), establishes a framework for collaboration that will leverage the core strengths of both institutions, says a statement.
This will include facilitating access to finance, technology development infrastructure and business development services.
Added to the MOU’s focus areas is the establishment of joint funds, shared pilot manufacturing facilities, and co-location initiatives to improve regional support for entrepreneurs, especially in underserved areas, particularly townships and rural areas.
“This MOU is an exciting and critical step in the TIA’s mandate to forge meaningful partnerships that amplify our tangible impact,” says Loyiso Tyira, TIA board chairperson.
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“As we undergo our strategic review process, we are deliberately working to maximise strategic partnerships to create an enabling environment for small enterprises, including cooperatives, start-ups and innovators.
“By aligning our financial and non-financial support mechanisms with Sedfa, we are building a more robust and responsive ecosystem. Our goal is to ensure that innovative ideas from our technology stations and incubators have a clear and well-supported pathway to market, and that the businesses behind them can achieve sustainable growth.
“What we need is a seamless ecosystem that mitigates the challenges of innovators knocking on various government doors for support. By pooling our efforts, we can harmonise support for small enterprises and remove any duplicated efforts.”
The collaboration comes as officials from the TIA have highlighted the difficulties of attracting funding, particularly for grassroots innovators.
Resultantly, the TIA and Sedfa union is designed to address challenges faced by small enterprises, including a lack of early-stage funding, limited access to technology and specialised business support.
For small enterprises, time is money, and unnecessary red tape stifles their ability to innovate, says the statement.
Through joint ventures such as the proposed Joint Early-Stage Venture Capital Fund of Funds and a Joint Seed Fund Programme, the agencies aim to unlock significant capital for promising technology-driven ventures.
Nonzuzo Makanda, Sedfa board chairperson, comments: “This collaboration will be instrumental in delivering on our mission to support the growth and development of SMMEs, as well as deliver on our vision of offering an end-to-end solution for innovators.
“For our clients, this means more than just financial assistance; it means direct access to the technology and innovation expert support of the TIA, which can transform their business models and give them a competitive-edge.
“The TIA and Sedfa are the only government entities that offer pre-seed funding to SMMEs in South Africa. Our agencies offer a bespoke approach that will create an enabling environment for SMMEs and innovators to commercialise. This is a powerful combination that will undoubtedly lead to greater economic inclusion and job creation.”
