Black Tech Entrepreneurs in High Demand
JOHANNESBURG – Young black South Africans with entrepreneurial ambitions may well find that studying computer programming or software developing provides the springboard they need to grab the eye of a venture capital funder.
With an inherent bias towards high-growth, scalable investments, many venture capital (VC) funds tend to favour technology businesses or those that are innovation-related, and can be easily piloted and, preferably, patented.
Brett Commaille of Angel Hub Ventures says that while most investors are “desperate to fund black entrepreneurs” there is an extreme shortage of black entrepreneurs in the types of businesses that VCs would invest into.
“We fund a very specific business that is highly scalable and likely to grow rapidly in international markets,” he explains. Commaille admits that VC funds may also not have reach into black communities to find budding entrepreneurs and rely on these entrepreneurs finding them.
Keet van Zyl, co-founder and partner at Knife Capital, agrees that deals must be able to compete internationally. “There is a natural bias in the high-risk entrepreneurial space towards businesses with high potential returns,” he comments, reiterating that there simply aren’t enough black entrepreneurs in the technology space.