Seda Nelson Mandela Bay ICT incubator entrepreneurs increase turnover to R7,5 million in 2012/13

Over the last three years, SNII has supported 98 businesses which have created a total of 85 direct and 251 indirect jobs. The turnover generated by the business in the same period amounted to R19,8 million in relation to total grant funding of R10,6 million over the same period.

September 25, 2013: The 35 small businesses based at the Seda Nelson Mandela Bay Information Communication Technology Incubator recorded an increase of R2,2 million in turnover from R5,3 million in the previous year to R7,5 million in  the 2012/13 financial year.

Announcing the incubator’s results today, centre head Sipelo Lupondwana says the increase in turnover was significant in relation to total grant funding of R3,5 million in the review period. The businesses created a total of 35 direct and 70 indirect jobs during the same period. A total of eight enterprises will graduate from the programme today.

“I am equally pleased to announce that SNII has met and exceeded many of the objectives it set out to achieve during 2012/13. The organisation has achieved more than 90% of its targets in the year under review. The organisation established 12 enterprises in the review period measured against a target of 10. It also met its target of supporting 35 businesses. A total of 35 direct and 70 indirect jobs were created exceeding expectations.

“The combined turnover of the businesses grew from R5,3 million in 2011/12 to R7,5 million in 2012/13. SNII also received grant funding of R3,5 million during the review period from its funders the Nelson Mandela Bay Municipality and the Seda Technology Programme. About 68% of the funding went to enterprise development, 7% to the capital budget and the rest was allocated to the support function,” Lupondwana says.

SNII also signed an enterprise development partnership for six of its incubated businesses with Algoa FM. Entrepreneurs from SNII are sponsored advertising and promotion on the radio station’s website valued at R540 000.

Of the 35 businesses supported 11 were virtual incubates, 9 under full incubation, 8 in pre-incubation or ideas phase which includes prototyping and feasibility. A total of four were at launchpad phase which means they are ready to take their products to the market. Three of the businesses are women-owned while a further three hold more than 25% but less than 51% ownership.

Lupondwana says more than 70% of the businesses are owned by youth. The organisation is also delighted that it managed to graduate 3 enterprises in 2012/13. Before they can graduate, businesses must demonstrate a solid understanding of the business, a growth plan as well as a good pipeline of business. They must show a stable turnover and create jobs. The eight graduating business will also go through the six-month SNII post-incubation programme which focuses on strategy, quality and financial management.

Lupondwana explains that the 2012/13 financial year also brought to an end its three-year strategy cycle. Over the last three years, SNII has supported 98 businesses which have created a total of 85 direct and 251 indirect jobs. The turnover generated by the business in the same period amounted to R19,8 million in relation to total grant funding of R10,6 million over the same period.

“The organisation also graduated nine businesses during this period. SNII is particularly pleased that throughout this period 100% of the businesses in the incubation programme survived their first year with survival rates above 95% in their second year. This is particularly exciting for the organisation considering that five out of seven new businesses in South Africa do not make through their first two years. This highlights the benefits small businesses can accrue from incubation programmes such as SNII which are designed for maximum impact.

“Furthermore, SNII has engaged in strategic local and international partnerships which should have the effect of elevating the organisation among industry stakeholders. For example, the organisation formed high-value partnerships with industry and academia. In October 2012, SNII began a three-year partnership with the University of Oldenburg’s International Centre for Social Entrepreneurship and Technology.  SNII hosted a delegation from the university and ICET in a kick-off workshop where entrepreneurship and the incubation models of the two partners were shared. During the review period, SNII hosted three postgraduate students from Oldenburg. This programme gives SNII exposure to global perspectives,” adds Lupondwana.

In addition, SNII is a participating partner of the DASIK project founded by the German Academic Service and the Federal Ministry for Economic Corporation and Development. The main objective of the DASIK project is to develop and conduct intensive training courses in current ICT-related research fields, in order to generate a transfer of knowledge between the members of the participating partner institutions such as the Nelson Mandela Metropolitan University, Oldenburg University and the University of Dar es Salaam.