South Africa's Innovation Fund pilot phase shows promise amid challenges
THE Department of Science, Technology and Innovation recently briefed Parliament on the results of its five-year Innovation Fund pilot phase, revealing that 96 startups had been supported since 2020.
Image: AI Ron
THE Department of Science, Technology and Innovation (DSTI) recently briefed Parliament on the results of its five-year Innovation Fund pilot phase, revealing that 96 startups had been supported since 2020 — but with glaring disparities in provincial representation and private-sector hesitancy threatening its scalability.
Acting director-general Gugulethu Zwane, leading the DSTI delegation, framed the Innovation Fund as a response to the White Paper on Science, Technology, and Innovation, implemented through the Decadal Plan.
Mlungisi Cele, the newly appointed director-general and former chief executive of the National Advisory Council on Innovation (Naci), emphasised the Fund's role in commercialising innovation. 'The Fund includes interventions aligned with the Decadal Plan's objectives, with measurable indicators to track progress,' he said.
Konanani Rashamuse, DSTI chief technocrat, detailed the 'Fund on Funds' (FOFs) model, where government seed capital attracts private investment. To date, R265 million in public funds has leveraged R1.3 billion — a fivefold multiplier effect.
Three FOFs have been established, including the High Impact Seed Fund and the Public Investment Corporation Technology Development Fund.
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Advertisement
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Next
Stay
Close ✕
However, Cele admitted that South Africa lagged behind Nigeria, Kenya, and Rwanda in venture capital activity. 'One of our goals is to scale up and position South Africa as a leader,' he said.
MPs grilled the DSTI on stark inequities. Gauteng and the Western Cape account for 80% of funded startups, leaving other provinces underserved. The MK Party's Thembinkosi Mjadu demanded action: 'What measures will ensure equal geographic distribution?' Rashamuse pointed to the DSTI/EPF Tech Fund Venture Building Programme, targeting underrepresented regions, but conceded more work was needed.
Gender transformation remains another hurdle. 'The venture capital industry lacks enough first-time female innovators,' Rashamuse acknowledged. Cele highlighted the Women in Technology and Innovation Programme, launched in March 2025, as a step forward.
Rashamuse admitted high failure rates are inherent in venture capital but argued even a 10% success rate could yield a significant impact. 'We need a large enough pipeline to sustain failures while ensuring the successes create social impact,' he said.
A major concern is private-sector engagement. Cele cited 'risk aversion' and 'lack of policy certainty' as barriers. Rashamuse added that stronger data transparency could rebuild trust. 'We must position the Fund as an attractive investment for the private sector,' he said.
Meanwhile, budget constraints loom. Cele revealed Minister Blade Nzimande is lobbying Treasury for increased funding, noting South Africa's innovation budget pales in comparison to global peers.
Despite challenges, Rashamuse showcased standout startups: Stone Three: AI-driven mining tech operated from Cape Town but deployed globally.
AI-driven mining tech operated from Cape Town but deployed globally. Artisan Biomed: Precision medicine using DNA-based diagnostics for African patients.
Precision medicine using DNA-based diagnostics for African patients. LignOrganic: Waste-reducing biomass solutions from macadamia nut shells.
Looking ahead, DSTI plans to: Scale the Fund and assess the pilot phase independently.
Boost youth and female participation through targeted programmes.
Develop a digital dashboard for monitoring.
Host the SA Tech Challenge 2025 in Cape Town to spur innovation.
Chairperson Tsakani Shiviti from the ANC stressed the need for a 'coherent system' bridging grassroots entrepreneurship to commercial markets. 'We must close the gap between development and local product accessibility,' she said.
The ANC's Vusumuzi Nkosi pushed for metrics tracking long-term social impact, while the DA's Natasha Mazzone called for expert-backed responses in future briefings.
As the meeting adjourned, the message was clear: The Innovation Fund has potential, but without equitable distribution, private-sector buy-in, and sustainable funding, its promise may remain unfulfilled.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
IOL News
11 hours ago
- IOL News
Gauteng launches innovative number plates to fight crime
Gauteng's new number plates have QR (quick response) codes. Image: Supplied The Gauteng provincial government this week launched a new high-tech, tamper-proof and crime-fighting number plate system to be piloted over the next six months on its fleet before being publicly rolled out. According to the provincial Roads and Transport Department, the new intelligent number plate system represents a giant leap as it is a secure, traceable, and smart solution, incorporating tamper-evident decals, forensic QR (quick response) codes, and a fully digitised back-end portal. Gauteng Premier Panyaza Lesufi and Roads and Transport MEC Kedibone Diale-Tlabela officially unveiled the new system on Thursday in Johannesburg. The system's features include the ability to drastically improve the credibility of number plates and to enable license plate tracking within the value chain, from manufacturer to the vehicle owner. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ 'These technological enhancements are designed to combat vehicle theft, fraud, and cloning, while improving road safety and empowering traffic law enforcement across the province,' the department explained this week. For the next six months, the system will be piloted using g-Fleet vehicles affixed with the technologically advanced new number plates as part of the stress testing project before the provincial rollout. 'This system is set to drastically improve the credibility of number plates and to enable license plate tracking within the value chain, from manufacturer to end user (vehicle owner),' stated the department. In addition, it is hoped that the system will also address longstanding challenges in vehicle registration and the law enforcement framework, tackling cloned or fraudulent license plates, lack of interoperability with Southern African Development Community systems, and inadequate data traceability. Lesufi said his administration, assisted by the Council for Scientific and Industrial Research, is now deploying a digital system that ensures the ability to account for every vehicle on the province's roads. He warned that those using fraudulent or duplicate number plates will have no space or time to drive in Gauteng. Diale-Tlabela said the smart number plates will significantly reduce vehicle cloning, trafficking of stolen vehicles, and the use of falsified plates in criminal activities, as well as disrupt criminal networks and improve road safety. The Gauteng provincial legislature's Portfolio Committee on Transport and Logistics welcomed the strategic introduction of the number plates as an intervention towards safer roads.
IOL News
15 hours ago
- IOL News
South Africa's Innovation Fund pilot phase shows promise amid challenges
THE Department of Science, Technology and Innovation recently briefed Parliament on the results of its five-year Innovation Fund pilot phase, revealing that 96 startups had been supported since 2020. Image: AI Ron THE Department of Science, Technology and Innovation (DSTI) recently briefed Parliament on the results of its five-year Innovation Fund pilot phase, revealing that 96 startups had been supported since 2020 — but with glaring disparities in provincial representation and private-sector hesitancy threatening its scalability. Acting director-general Gugulethu Zwane, leading the DSTI delegation, framed the Innovation Fund as a response to the White Paper on Science, Technology, and Innovation, implemented through the Decadal Plan. Mlungisi Cele, the newly appointed director-general and former chief executive of the National Advisory Council on Innovation (Naci), emphasised the Fund's role in commercialising innovation. 'The Fund includes interventions aligned with the Decadal Plan's objectives, with measurable indicators to track progress,' he said. Konanani Rashamuse, DSTI chief technocrat, detailed the 'Fund on Funds' (FOFs) model, where government seed capital attracts private investment. To date, R265 million in public funds has leveraged R1.3 billion — a fivefold multiplier effect. Three FOFs have been established, including the High Impact Seed Fund and the Public Investment Corporation Technology Development Fund. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ However, Cele admitted that South Africa lagged behind Nigeria, Kenya, and Rwanda in venture capital activity. 'One of our goals is to scale up and position South Africa as a leader,' he said. MPs grilled the DSTI on stark inequities. Gauteng and the Western Cape account for 80% of funded startups, leaving other provinces underserved. The MK Party's Thembinkosi Mjadu demanded action: 'What measures will ensure equal geographic distribution?' Rashamuse pointed to the DSTI/EPF Tech Fund Venture Building Programme, targeting underrepresented regions, but conceded more work was needed. Gender transformation remains another hurdle. 'The venture capital industry lacks enough first-time female innovators,' Rashamuse acknowledged. Cele highlighted the Women in Technology and Innovation Programme, launched in March 2025, as a step forward. Rashamuse admitted high failure rates are inherent in venture capital but argued even a 10% success rate could yield a significant impact. 'We need a large enough pipeline to sustain failures while ensuring the successes create social impact,' he said. A major concern is private-sector engagement. Cele cited 'risk aversion' and 'lack of policy certainty' as barriers. Rashamuse added that stronger data transparency could rebuild trust. 'We must position the Fund as an attractive investment for the private sector,' he said. Meanwhile, budget constraints loom. Cele revealed Minister Blade Nzimande is lobbying Treasury for increased funding, noting South Africa's innovation budget pales in comparison to global peers. Despite challenges, Rashamuse showcased standout startups: Stone Three: AI-driven mining tech operated from Cape Town but deployed globally. AI-driven mining tech operated from Cape Town but deployed globally. Artisan Biomed: Precision medicine using DNA-based diagnostics for African patients. Precision medicine using DNA-based diagnostics for African patients. LignOrganic: Waste-reducing biomass solutions from macadamia nut shells. Looking ahead, DSTI plans to: Scale the Fund and assess the pilot phase independently. Boost youth and female participation through targeted programmes. Develop a digital dashboard for monitoring. Host the SA Tech Challenge 2025 in Cape Town to spur innovation. Chairperson Tsakani Shiviti from the ANC stressed the need for a 'coherent system' bridging grassroots entrepreneurship to commercial markets. 'We must close the gap between development and local product accessibility,' she said. The ANC's Vusumuzi Nkosi pushed for metrics tracking long-term social impact, while the DA's Natasha Mazzone called for expert-backed responses in future briefings. As the meeting adjourned, the message was clear: The Innovation Fund has potential, but without equitable distribution, private-sector buy-in, and sustainable funding, its promise may remain unfulfilled.
IOL News
a day ago
- IOL News
Top scientist wants to prevent AI from going rogue
The winner of the Turing Award, also known as the Nobel Prize for computer science, has been warning for several years of the risks of AI, whether through its malicious use or the software itself going awry. Image: RON AI Concerned about the rapid spread of generative AI, a pioneer researcher is developing software to keep tabs on a technology that is increasingly taking over human tasks. Canadian computer science professor Yoshua Bengio is considered one of the godfathers of the artificial intelligence revolution and on Tuesday announced the launch of LawZero, a non-profit organization intended to mitigate the technology's inherent risks. The winner of the Turing Award, also known as the Nobel Prize for computer science, has been warning for several years of the risks of AI, whether through its malicious use or the software itself going awry. Those risks are increasing with the development of so-called AI agents, a use of the technology that tasks computers with making decisions that were once made by human workers. The goal of these agents is to build virtual employees that can do practically any job a human can, at a fraction of the cost. "Currently, AI is developed to maximize profit," Bengio said, adding it was being deployed even as it persists to show flaws. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ Moreover, for Bengio, giving AI human-like agency will easily be used for malicious purposes such as disinformation, bioweapons, and cyberattacks. "If we lose control of rogue super-intelligent AIs, they could greatly harm humanity," he said. One of the first objectives at LawZero will be to develop Scientist AI, a form of specially trained AI that can be used as a guardrail to ensure other AIs are behaving properly, the company said. The organization already has over 15 researchers and has received funding from Schmidt Sciences, a charity set up by former Google boss Eric Schmidt and his wife Wendy. The project comes as powerful large language models (or LLMs) from OpenAI, Google and Anthropic are deployed across all sectors of the digital economy, while still showing significant problems. These include AI models that show a capability to deceive and fabricate false information even as they increase productivity.
