New seed funding instrument for small enterprisesDate posted: 24.01.2014 | Author: Harry Bovensmann
R25 million has been reserved by the Technology Innovation Agency (TIA) for a seed funding programme to boost small entrepreneurs with bright new ideas. However, TIA’s board might allow a further R30 million.
It is the first-such funding instrument in South Africa as the country joins a number of emerging countries that already use small grants to help entrepreneurs fund the initial proof of concept stage for new ideas.
TIA says while the fund is operating at some universities, the agency is still in discussions with other universities as well as provincial development agencies through which it plans to offer seed grants of up to R500 000 per entrepreneur. The seed grants would cover things such as initial proof of concept, prototype development, sourcing of intellectual property (IP) opinions, production of market samples, support of certification activities, piloting and scale-up of techno-economic evaluations, primary market research, as well as business plan development. In very special circumstances, an allocation of up to R1 million will be considered.
The idea is that techno-entrepreneurs that need funding will be able to approach these agencies, which would then forward names to TIA for approval of these grants. For entrepreneurs to qualify for TIA funding, projects must hold significant potential for further investment.