In 2020, Thandeka Xaba and her business partner, Nonkululeko Komanyane, launched Digital Africa Ventures – a venture capital fund that aims to bridge the funding and support gap for early-stage tech entrepreneurs across South Africa. To date, the female duo collectively raised R26.5 million in seed funding for early-stage, digital tech start-ups. Having successfully founded entrepreneurial ventures of their own, they bring hands-on experience and much needed diversity and relatability to early-stage investing in South Africa.
The DAV Fund is anchored by the SA SME Fund and is further supported by ESquared Investments and PAPE Fund Managers.
The Fund’s investment thesis is anchored on investing in early-stage tech businesses with diverse teams. The principals of the fund touched on why this thesis is close to their hearts
“Digital Africa Ventures’ investment thesis is focused on writing cheque sizes between R2 million to R5 million – which is difficult to raise in South Africa since there is generally a concentration of funding appetite below R2 million and above R7.5million. We do not only deploy capital but also assist investee companies with their strategy and in reaching key milestones. Our approach also assists with strategic support in operations, sales, marketing and business development,” says Komanyane.
Lebogang Poonyane, who joins the team as a partner, had this to add: “It’s time for a women-led venture capital fund to take centre-stage, and DAV is doing exactly that.” Further he added on the value-add DAV was contributing to the early-stage investing ecosystem: “There is a lot of opportunity to be unearthed for start-ups and traditional early-stage investors by deliberately funding businesses and adding a layer of professionalism to early-stage rounds.”
“Since 60% of South Africa’s tech entrepreneurs are black, the need for support at the early stages of their businesses will ultimately drive the technological advancement, job creation and economic growth desperately needed in South Africa and elsewhere in Africa. There is a lack of capital in the seed investment stage other than from friends and family. In addition, entrepreneurs who have innovative ideas and the requisite skills to build a business are left unsupported at times as they do not have access to generational knowledge and wealth,” says Xaba.
Thandeka Xaba heeded the call to take up entrepreneurship as a primary mechanism to achieve equity and improve the quality of life for African citizens. She believes that the combination of technology and responsible entrepreneurship are critical to bridging income inequality in South Africa and hopes that DAV will form part of the solution.
Having joined the Allan Gray Orbis Foundation in 2011 as a Candidate Fellow, she explains the reason: “I applied because the entrepreneurial vision of the Foundation appealed to me. The Fellowship Programme initially helped nurture my entrepreneurial mindset from a young age through programme activities centered around ideation and cognition and has been supportive along various stages of my entrepreneurial journey.”
Digital Africa Ventures made its first investment on 31 March 2021 into Tripplo Software, a digital logistics platform that facilitates the safe and efficient movement of road freight cargo across SADC. Within its second year of operations, Tripplo has over 400 transporters on its platform & has facilitated movement of cargo within South Africa and cross borders between Angola, Botswana, DRC, Eswatini, Lesotho, Malawi, Mozambique, Namibia, Tanzania, Zambia and Zimbabwe. The business was awarded Fast Company’s 2021 Most Innovative Company in South Africa after being named AfricArena’s Best Johannesburg Start-up in 2020.
Says Founder of Tripplo, Victor Chaitezvi: “As we continue reinventing for the road freight industry across Africa using technology, we are very excited to partner with the well-connected team at DAV. We truly enjoyed the due diligence process and we have already started seeing some commercial value add. DAV has truly partnered with us & are focusing on the growth of Tripplo. It has been so much fun already and we look forward to our long-term partnership.”
In 2018, Standard Bank entered a five-year strategic partnership with tech start-up accelerator Founders Factory Africa to develop home-grown African start-ups. Tripplo was born out of the incubator programme in 2019 with the vision to create a new standard for African road freight logistics by reimagining the movement of cargo in a safe and efficient manner. Through their partnership with Standard Bank, Tripplo has built a platform that incorporates multiple Application Programme Interface (API) integrations across Standard Bank’s financial services products. This includes FX eMarket Trader, Instant Money, Goods in Transit through Standard Bank insurance and Telematics Device Referral with Standard Bank fleet.
Looking ahead, Tripplo plans to use its recent fundraising from Digital Africa Ventures, to increase their market share, focus on SADC expansion, expand their customer value proposition and services, and prepare for a Series A fund raise.