FNB takes Silicon Cape to new heights

Cape Town – The Mother City’s transformation into the Digital City of Africa took an exciting step forward on Tuesday, when First National Bank (FNB) and Silicon Cape announced a three-year strategic partnership worth R1m per annum in funding and resource support to boost business activity in South Africa.

The Silicon Cape initiative is a non-profit organisation that was started by Dragons Den entrepreneur Vinny Lingham and venture capitalist Justin Stanford in 2009. It aims to improve the ecosystem for tech businesses, by providing a platform for the community to collaborate, share resources and amplify tech innovation.

Fin24's Matthew le Cordeur speaks to Lingham about the partnership.

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The initiative to date has been completely volunteer driven and includes tech-entrepreneurs, developers, angel investors and venture capitalists that are passionate about entrepreneurship in their community. Silicon Cape has over 8 500 registered members and is one of the largest entrepreneurial networks in Africa. The collaboration with FNB is Silicon Cape’s first long-term partnership since inception.

Cape Town mayor Patricia de Lille said the city was aiming to become a sophisticated digital city that had the infrastructure and environment for tech start-ups to thrive. “We want to become the digital city of Africa,” she said. “We can become a growing and thriving centre for our region, with multiplied effects for our economy.”

The city has rolled out over 350km of broadband fibre optic cable and aimed to increase that to 700km, a fundamental development in reaching that vision.

The city wanted to encourage and support start-ups with digital ideas. “That requires real partnerships with organisations like Silicon Cape and the private sector to make our dreams a reality,” she said.

“This means directly supporting those who need time and support to make their good ideas great and to add real value to our economy,” she said. "These are just the building blocks for a long-term project.

“Our vision is to use the unique infrastructural assets of our city to create a new digital centre and, in so doing, we will make Cape Town one of the most important investment centres in Africa.”

Enabling environment for SMEs

The partnership with Silicon Cape advances FNB’s contribution to creating an enabling environment for SMEs in South Africa, said Stephan Claassen, FNB business provincial head for the Western Cape.

“Through its diverse membership, Silicon Cape has been at the forefront of efforts to minimise barriers in doing business among tech-entrepreneurs,” he said. “The partnership will also enable us to share best practice and contribute towards better positioning of tech businesses to potential investors.

“FNB sponsors Silicon Cape because we really like this as an industry that can be a fantastic job creator not only in the Western Cape, but also in the Western Cape,” said Claassen. “They have a lot of early adapters of technology and as a bank we like to roll out a lot of innovative technology.”

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Building a better ecosystem

Alexander Fraser, the outgoing chairperson of Silicon Cape, said FNB’s endorsement was a vote of confidence for tech-entrepreneurs and every start-up business in the Western Cape as well as the rest of South Africa.

“Big business has a crucial role in ensuring that entrepreneurs have the necessary support to create jobs and boost economic growth,” she said. “FNB’s backing will certainly bolster our efforts to build a better ecosystem for tech-entrepreneurs. This investment and long term commitment will enable Silicon Cape to scale and build additional value in our ecosystem.”

The tie-up was also welcomed by Tim Harris, the City of Cape Town’s Director of Trade and Investment. “This is an important collaboration between FNB and the tech sector in the city region,” he said. “Cape Town is poised to become a leading technology hub in Africa, and partnerships like this will catalyse the growth of the sector helping to drive economic growth and create jobs in our city.”  

Lingham welcomed the transformation of the organisation. “Cape Town has amazing talent and these guys who are taking a risk and jumping into start-ups deserve the up side,” he said. “There’s a lot of advantages in building tech companies.”

Sustainable, holistic tech ecosystem

Heather Lowe, head of Vumela Enterprise Fund at FNB, said they aimed to create a sustainable holistic tech ecosystem in a country where it is not easy to get started.

“The funding will be used to scale themselves up, but they will have a lot more than just that,” she said. “We will employ a full-time staff member for them, who will effectively act as their operations and marketing officer.

“Silicon Cape members will also have full access to the new FNB Portside building [the tallest green building in Africa], where they can use our slow lounges and work café for meetings, as well as our events facilities.”

Members will also have access to the Vumela Enterprise Fund and the bank will be able to give early stage equity funding for specific start-ups.

Explaining how the partnership evolved, Lowe said she was chatting to Fraser at an event in May, where they discussed how their partnership with the Simodisa Start-Up Conference should be developed into something more on-going. “We were just chatting and then this idea came up,” she said. “Alex then pitched this partnership to our executive, who accepted it.”

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