South Africa's Department of Science and Innovations’ Technology Innovation Agency (TIA) has agreed to work with and offer matching funds with WZ Capital, a black-owned venture capital (VC) fund set up in 2015 by Sango Ntsaluba.
Ntsaluba, who chairs the Johannesburg based VC, founded SizweNtsalubaGobodo (SNG), which at one time was one the country’s largest black accounting firms and merged with Grant Thornton in 2018.
WZ Capital will invest ticket sizes of up to R1 million ($57,000) in early-stage tech firms with scalable and disruptive ideas.
The investment by the VC will in turn will be matched by TIA, by up to R1-million — meaning up to R2 million ($115,500) can be invested in any one deal.
TIA has allocated R1.5 million ($86.600) as part of a project with WZ Capital, which means that together the two can deploy up to R3 million ($173,200) in deals, under the pilot.
TIA shall co-invest from its existing instruments such as the Seed Fund, Rapid Fund, Technology Development Fund and the Pre-commercialisation Support Fund.
TIA business development manager Tandokazi Nquma-Moyo told Ventureburn in an email yesterday that while the VC will invest only in tech firms, it is not exclusively targeting black-owned firms.
She said while TIA and the VC are working on signing a few deals at the moment, none have been closed as yet.
Industry matching fund
The agreement is part of TIA’s Industry Matching Fund which the agency launched last year to offer a blended funding model between funders and industry.
The agreement follows an announcement last month that TIA would offer matching funds with two local angel investors, Jozi Angels and Dazzle Angels (SA’s first female-focused angel group) (see this story).
Nquma-Moyo said TIA has one or two more such agreements “in the pipeline”.
WZ Capital principal officer Lundi Njomane said since the VC was launched in 2015, it has invested just under R5 million ($288,700) in five investments, having worked with entrepreneurs in areas such as medtech, edtech, hospitality tech and artificial intelligence (AI).
Njomane didn’t want to disclose the names of the investee companies as yet, but was able to point out that three of the five investment are in black-owned firms.
He added that the VC has two further investment prospects that it is currently evaluating.
This article originally appeared on Ventureburn.
Featured image: WZ Capital via Facebook