The document discusses the startup financing landscape in South Africa, highlighting the barriers to accessing capital despite a wealth of talent and ideas. It emphasizes the need for private sector intervention and the potential of models like Y Combinator for encouraging deal flow within the venture capital and angel investing space. The author expresses optimism for overcoming challenges and fostering innovations similar to success stories from other regions.

1. Startup Financing
The Financing Gap
& Solution for South Africa
justin spratt – 4 July 2009

2. South Africa
SA has….
Great people
Right Culture
Great ideas
Enough money
So what is the problem?
www.twitter.com/justinspratt
www.twitter.com/islabs

3. Context: Recession
• Global mainly
• U versus V
• SA should be out be early
2010
• But 3.5% growth wont solve
our problems!
www.twitter.com/justinspratt
www.twitter.com/islabs

4. Context: Poor
Fundamentals
• Government wont solve our
problems
• Enablement can help
• Intervention by private
business is critical
www.twitter.com/justinspratt
www.twitter.com/islabs

5. The Good News
• Michael Porter & Cluster
Theory
• Examples:
• Bangalore
• Silicon Valley
• Detroit
• Wall Street
• Rwanda
• Venice
www.twitter.com/justinspratt
www.twitter.com/islabs

6. “All we need is deal
flow for VC and
Angel to start
working… I am
coming back soon
to help with this”
Vinny Lingham, June 2009
www.twitter.com/justinspratt
www.twitter.com/islabs

7. Finance Continuum
www.twitter.com/justinspratt
www.twitter.com/islabs

8. ISLabs – Germination
• Water-cooler chats…
gazillion ideas
• IS has some of the smartest
people
• We are best equipped
private enterprise to help
tech
www.twitter.com/justinspratt
www.twitter.com/islabs

9. The Idea: A Mashup
Angel great, but we don’t have $
Incubator best model for IS
Y- Combinator
Google Projects
Summer of Code
www.twitter.com/justinspratt
www.twitter.com/islabs

10. Y-Combinator: Successes
• Loopt (2005), mobile social networking, on all
the major U.S. carrier networks
• Scribd (2006), a Web-based document
publisher, partnered with Random House
• Xobni (2006), an e-mail software maker, was
demoed by Bill Gates, a $20 million buyout offer
• Weebly (2007), a website authoring toolmaker,
1-million-users mark
• Omnisio (2008), an online video annotator,
acquired last year by Google, circa $15 million
www.twitter.com/justinspratt
www.twitter.com/islabs

11. Google Projects: Successes
www.twitter.com/justinspratt
www.twitter.com/islabs

12. Thanks!
www.twitter.com/justinspratt
www.twitter.com/islabs