Ventures queue up for Hasso Plattner
A R380m venture capital fund created to back local technology companies has received 350 applications for cash, but has selected only five as having the potential to go global.
Hasso Plattner Venture Capital Africa has signed a deal to inject R8m into Cibecs in exchange for a 25% stake in the business. It was due to finalise a deal with marketing automation company Global Vision yesterday, and should sign another deal with a Cape-based company next week.
So far its five initial investments have cost about R80m, said the fund’s director Andrea Böhmert.
“There’s tons more to spend. We’d like to get the message out that there’s no shortage of funding in SA for good investment opportunities. We get an average of one application a day, but you have to kiss a lot of frogs to find a prince.”
Böhmert said the fund wanted to invest in seven or eight more companies with the ability and desire to take their goods or services to an international market.
The Cibecs deal will help the company chase international sales for its locally developed software that automates the back-up and recovery of business data stored on desktop or laptop computers. Its compression and encryption features protect the integrity of the data and minimise the pressure on storage space.
Cibecs was formed in 2004 by Richard Dewing, and its software has been sold to more than 30000 users in SA.
The deal with the Hasso Plattner fund was exciting for Citecs’ international growth as it would give it access to crucial expertise and a network of business contacts, Dewing said.
“This investment by Hasso Plattner Ventures Africa is a major boost not only for us, but also for the general entrepreneurial climate and is a vote of confidence in SA’s ability to produce innovation of an international standard.”
Böhmert said Cibecs was not so much in need of cash but for help in accessing new markets. “The company has an excellent product and has already proven very successful in the local market. Their business model is sound and we believe that the key to their global success lies in increased market visibility and international market access.”
Cibecs will get management support from the fund’s mentors and from the parent fund in Germany, which has contacts with other venture capitalists and the technology industry in general.
The South African branch was launched last year by Hasso Plattner, co-founder of the German software giant SAP.
It has invested locally in Inala Technologies and Dabba Telecom. Typically, the fund expects to nurture its companies for five years before selling at a profit.
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