On Thursday, 28 July, Nick Allen, Founder, Savant Capital and Sahil Affriya, Principal at Savant Capital, chatted to Pranary about the realities facing Tech Hardware entrepreneurs in SA… And the best way forward! Below is a brief outline of what was discussed.
We would like to thank Sandras Phiri and the Pranary team for hosting us at their event!
Why are there so few tech accelerators in SA?
Being an entrepreneur is tough. Being a hardware tech entrepreneur is much tougher.
It’s just a longer, more complex journey, with more boxes to tick.
And in SA, it’s even tougher.
But, it’s not impossible…
The truth is there is very little funding for hardware in this country. That’s why nobody else is in this space. But there is funding – you just need to work hard to access it.
And if you stick to it – it is a worthwhile journey.
Two examples of successes would be:
- https://www.snuza.com/ – an apnoea monitor for babies, which is now the top movement monitor for babies, in the world.
- https://leatt.com/za/ – started with a neck brace for motocross, and has since built in to multi-million dollar a year business.
Advice for startups:
- If you are a hardware innovator, you will need support. You can write code in your garage, but not build a mould. It doesn’t matter what arena you are in. You will need VC support early on.
- Spend your money on actually taking your business to market. Get your tech to market – that’s the priority – more important than patenting.
- Build a team. You don’t have all the skills needed to go to market alone.
- Don’t say no to an opportunity, in the hopes of a better opportunity, work what you have in front of you, and work it hard!
- Build your models and then break it down. Going from A to B will cost this. From C to E will cost this – and so on. Small steps to start, bigger steps as you gain traction. Then fund per step, because your value increases with each step.
What investors look for in Tech startups:
“We believe that tech businesses, that have a strong IP, not necessarily patents, but strong intellectual property, have a strong competitive advantage and are far more resilient than businesses that don’t. They can spend a long time trying to find their product market fit – and still be successful. They can progress without a strong business leader, if they have the strong tech, a strong inventor. Strong tech will make your business more resilient and you will be more attractive to investors”
Nick Allen, Savant
- The ability to translate your idea into something real and tangible
We need more than words and great ideas, we need to know you have unpacked this. Show us that you have taken the first step. It’s not just an idea, it’s more… If you have an idea, start building. Get traction. The tech and the investors can follow from there. If you can, try to get revenue in from the get go. From an investment perspective, it makes your position much stronger.
- The quality of your team.
Your business success is based on the ability of your team. Success is a team effort. Hardware is a multifaceted challenge – so build a team. Find the right people. Be brutal about your strengths and weaknesses. Find those whose skills complement you.
- Network! Network! Network!
You can have an amazing idea, but if no one knows about it, it’s valueless.
- Talk! Talk to your customers.
Find out what they want. Know who they are. Get feedback. Are you meeting their needs? Investors fund solutions!
- Be prepared for a long hard slog.
This is a long journey, a hard journey, but a rewarding journey. Ready yourself. Start… and be committed. It will be rewarding, but you have to be around for the long haul.
- There is no one size fits all answer to any investment question. Best you can do is find the investor most aligned with your goals, and outcomes. And yes, Savant can help with that!
We are looking for any early-stage tech innovation that can be taken through to investment. It doesn’t matter what market you are in. If you have the tech, we can work with you! Over the course of 4 months, we will help you build an investable business. Click here to register