South Africa

Cape Town

MEMBERS:
City of Cape Town Silicon Cape WESGRO

"Greater Cape Town's tech sector is notably dynamic, with a high percentage of companies reaching scale in the past decade and actively supporting other local tech companies."

Endeavor Insight
#1 African Ecosystem in Talent & Experience
#3 African Ecosystem in Funding
#3 African Ecosystem in Performance

Highlights

Cape Town’s 450 tech firms, including both giants like Takealot and Amazon and early-stage companies, collectively employ more than 40,000 people. And more businesses are moving to the South African ecosystem. Cape Town is one of the world’s fastest-growing regions in terms of foreign investment, according to a report from fDi Intelligence.


Knife Fund III is a new fund managed by Cape Town-based VC firm Knife Capital. The fund invests in high-growth sectors in South Africa with strong potential for expansion within Africa and internationally. Swiss investment company Crypto Valley Venture Capital (CV VC) set up its first African office in Cape Town to invest in Blockchain-focused African startups. CV VC and its partners are looking to invest in 100 startups over the next four years. The new office will also serve as a hub for transferring know-how and experience from Swiss Crypto Valley to the Cape Town ecosystem. Private equity and venture capital conference SuperReturn Africa 2022 is scheduled to take place in Cape Town in December. Notable recent funding deals include Adtech startup Adbot’s R7 million ($500, 000) raise in November 2021, and games publisher Carry1st’s $20 million Series A in January 2022.


The Women in Business program from the Cape Innovation & Technology Initiative exposes female entrepreneurs to the latest technology resources to grow their business. BioCiTi is a specialized biotech incubator for African entrepreneurs. TECHSPO Cape Town brings together developers, marketers, designers, and innovators annually.

Ecosystem by the Numbers

EARLY-STAGE FUNDING
(2019H2-2021)
$204 m
GLOBAL AVG. 2023
$687 m
ECOSYSTEM VALUE
(2019H2-2021)
$2.8 bn
GLOBAL AVG. 2023
$28.6 bn
MEDIAN SEED ROUND (2019H2-2021)
$570 k
GLOBAL AVG. 2023
$671 k
MEDIAN SERIES A ROUND (2019H2-2021)
$2.5 m
GLOBAL AVG. 2023
$4.7 m
SOFT. ENGINEER SALARY (2021)
$30 k
GLOBAL AVG. 2023
$46 k
669 m
GLOBAL AVG. 2023
11.3 bn
46
GLOBAL AVG. 2023
101
Amount ($)
Count (#)

Exits

(2017-2021)
EARLY-STAGE FUNDING GROWTH TIER (2018/19 VS. 2020/21)
8
Calculated on a scale of
1 (lowest) to 10 (highest)
TOTAL VC FUNDING (2017-2021)
$722 m
GLOBAL AVG. 2023
$4.5 bn
TIME TO EXIT (2017-2021)
10.1 years
GLOBAL AVG. 2023
9.4 years

Sub-Sector Strengths

Fintech

Cape Town is one of Africa’s leading financial centers. The latest Global Financial Centers Index shows the city moving up eight positions to rank 54th worldwide, and much of Cape Town’s improvement in these rankings is down to its Fintech innovation. Intelligent banking startup JUMO raised $120 million in venture financing in November 2021. Payments company Yoco raised an $83 million Series C in July 2021.

Edtech

Injini is a nonprofit organization founded by the Cape Innovation & Technology Initiative and partners to accelerate Edtech solutions in Africa. Injini launched the first pan-African Edtech Think Tank in April 2022. Cape Town will host Edtech conference InnovateEDU in May 2022. The University of Cape Town opened an online high school, which began educating students in January 2022. Edtech solutions provider HyperionDev raised R50 million ($3.5 million) via equity crowdfunding in March 2022. Learning marketplace iXperience raised a R35 million rand ($2.5 million) Series A in May 2021.

Reasons to Move Your Startup to Cape Town

Business-Friendly Environment

Cape Town’s diversity, infrastructure, world-class universities, and vibrant environment make it an ideal home base for startups. 38% of South Africa’s developers call the city home. Cape Town also boasts more than 16 co-working spaces, including a lounge on top of Table Mountain that entrepreneurs can access for free on Tuesdays. The city is also investing in key infrastructure, including thousands of meters of fiber-optic cable.

Key Economic Zones

Cape Town has identified 2 key economic zones for development. The Atlantis Special Economic Zone (ASEZ) is dedicated to supporting green and circular economy businesses in renewable energy, recycling, and waste management, transportation, and smart agriculture. A second zone in Philipi supports agricultural activities in the area and includes business incubation and skills development programs.

Low Cost of Living

Cape Town is both beautiful and affordable. A 2021 study by Money.co.uk named Cape Town the sixth most affordable city to relocate to in the world. Cape Town also placed 178 in the 2021 Mercer Cost of Living City ranking, which included 206 cities from around the world. The cost of living in Cape Town is lower than in Kigali, Kampala, and Dar Es Salaam.

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