Endeavor South Africa

Dream Big. Scale Up. Pay it forward.

June 2021 Newsletter

Dear Friends of Endeavor,

Investment into African entrepreneurs is on the up, with Briter Bridges recently revealing that $560million in funding deals have been announced across Africa since January this year. We are proud to have played a part in this, with the first two investments of our Harvest Fund II into two Endeavor Entrepreneurs: Flexclub in the emobility space and Sendmarc in the cybersecurity space. The Fund invests in Endeavor Entrepreneurs who are raising capital, with 20% of the Fund’s carry to be reinvested straight back into the SA entrepreneur ecosystem through Endeavor.

In 2020, Endeavor Entrepreneurs raised in excess of R2 billion — three times the capital raised in 2019 (R700 million), with more than 50% of raises being led by international investors. Additionally, in 2017, the largest raise was R50 million, whereas in 2020 this was R680 million — a 14x growth and a lead indicator of the impact to come.

Endeavor Entrepreneurs have also increased job creation by 27% per annum over the last three years, creating a total of 4,234 new jobs. As at the end of 2020, 11,535 people were employed, more than 75% of whom are black. It is encouraging to see that, after a cautious pause at the start of the pandemic, job creation has now ramped up at all levels, including senior roles such as CFO at Wyzetalk, People Operations Manager at MFS Africa and Chief of Staff at Entersekt. This strong hiring trend across all Endeavor Entrepreneurs in 2021 is being propelled by remote working driving acceleration in digitisation, coupled with solid 2020 revenue performance and capital raising, highlighting that confidence in tech-enabled businesses is firmly on the rise.

Given this remarkable growth, it’s not surprising then that 4 South African Endeavor Entrepreneurs have been selected into Endeavor’s 2021 class of Outliers (167 companies in total). Outliers are teams leading the fastest growing scale-ups and are on the unicorn track. Congrats to the 4 South African Outliers:

• Clickatell: Pieter de Villiers
• GO1: Melvyn Lubega & Andrew Barnes
• HelloGroup: Nadir & Shaazim Khamissa
• SPARK Schools: Stacey Brewer

Apart from strong growth momentum, this quarter saw notable developments in the entrepreneur ecosystem:

Endeavor and SA SME Fund launched the Local Scale Up programme

• 15 companies spanning the various tech verticals
• Offers businesses tailored mentoring over a 1-year period leveraging Endeavor’s expert mentor network and provides a channel for earlier much-needed advice

Endeavor published a 3rd edition of the Series A Term Sheet Guidelines, fulfilling our promise to keep this documents live and open source. Thanks to all of you who contributed!

• Offer a starting point for negotiations and founder friendly tips
• Designed to aid both investor and founders alike so more time can be spent growing businesses

With such a successful quarter, one can’t help but be excited for what the rest of the year has in store.

Kind regards,
Alison Collier
Managing Director: Endeavor South Africa

FlexClub Adds $5 Million to Seed Round

Endeavor Entrepreneur FlexClub added $5 million to their seed round to improve the process of buying, insuring and financing cars across emerging markets. Endeavor South Africa was part of this capital raise via its co-investment vehicle, Harvest Fund II. Read more here.

Sendmarc Secures Further Funding

Endeavor Entrepreneur Sendmarc has secured a follow-up round of funding from Kalon Venture Partners. The company’s expansion plans include entering international markets while continuing to build its presence in South Africa. Click here for more information.

Endeavor Entrepreneurs Impress with Innovation

Endeavor Entrepreneurs Clickatell and Sendmarc were both recognised among Fast Company’s Most Innovative Companies of 2021. Clickatell was also listed as one of the top mobile payment companies and startups operating in San Francisco in 2021. Additionally, Wyzetalk won Best Corporate App at the 2020 Digital Impact Awards.

Hello Paisa Teams up with Mastercard to Help the SMME Sector

Endeavor Entrepreneur Hello Paisa recently partnered with Mastercard to roll out SoftPOS, a contactless payment acceptance solution that turns any NFC-enabled Android device into a physical point of sale. This is a game-changer for the SMME sector. Learn more here.

Tackling Youth Unemployment through Digital Upskilling at Scale

Business Day’s Michael Avery recently spoke to Endeavor Entrepreneur and Clickatell Co-founder Pieter de Villiers, and Endeavor Board Member and Accenture CEO Vukani Mngxati, about a bold, new, collaborative idea that addresses youth unemployment at scale. Click here to watch the interview.

New Unicorns

In this quarter, Endeavor saw not one but two unicorns emerging from the global network. Endeavor Nigeria Entrepreneur Flutterwave raised $170m from a Series C fundraising round, valuing it at over $1bn, while Endeavor Mexico startup, Bitso gained unicorn status following a $250m capital raise and valuation of $2.2bn.