The DTI spotlights small tech businesses

Rob“The opening of the first incubator in the DTI programme is a significant milestone in the effort to create and sustain jobs in South Africa,” trade and industry minister Rob Davies said.

Judi MEDO CEO Judi Sandrock said the incubator will unfold world-class technology, teleconferencing facilities, a TV studio and a space in the rejuvenated city of Joburg.

huballJudi Sandrock, Medo CEO, Yvonne Phosa, Mpumalanga MEC for economic development, Rob Davies, the minister of trade and industry, and Michael Masutha, the deputy minister of science and technology, open the Medo Youth ICT. The Department of Trade and Industry has launched the Youth Enterprise Development Strategy that aims to promote youth self-employment and youth-owned and managed enterprises.
(Images: Melissa Jane Cook)

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Melissa Jane Cook

Opened by the Department of Trade and Industry Minister Rob Davies on 11 November 2013, the MEDO Information Communication and Technology Incubator is the first youth incubator in the Department of Trade and Industry (DTI) Incubator Support Programme. The Micro Enterprise Development Organisation (Medo) will manage the programme, and provide training and support for participating entrepreneurs.

Medo connects small South African businesses with large companies to build supplier relationships and boost broad-based black economic empowerment credentials.

The DTI launched the Incubator Support Programme (ISP) to provide support for and grow small businesses across industry sectors.

“By promoting the incubators, the DTI has been encouraging private sector partnerships with government to support the programme in an effort to develop effective businesses,” said Jeffrey Ndumo, chief drector of the DTI.

“In May this year, Medo was awarded the first two incubators in the country and, as of now, is the ICT industry’s very first sector entrepreneur incubator.”

Medo chief executive officer, Judi Sandrock said: “The Medo ICT Incubator, based in the Maboneng District, will focus on supporting young entrepreneurs. The location was chosen to leverage high-speed fibre bandwidth connectivity as the focus of the incubator is the information and communication technology sector, as well as an internet TV studio that will facilitate internet TV broadcast.”

She added that the incubator will unfold world-class technology, teleconferencing facilities, a TV studio and a new rejuvenated space in Joburg. Further, the incubator will provide free services, such as access to internet, telephones and meeting and teleconference rooms, for to up to 300 small- to medium-sized businesses.

“There will be permanent incubation of approximately 20 ICT businesses and virtual incubation across industries allowing small businesses to use the facilities and benefit from the full suite of shared services. Introductions to supply chains of large industry and entrepreneurs looking to develop content for IP TV (Internet based television) will also become beneficiaries of this programme.

“This is a very exciting time for smaller and medium-sized enterprise growth in South Africa and MEDO is very pleased to be working with the dti on such an innovative development. The Medo ICT Incubation Centre is a phenomenal step in building economic growth and job creation in the country.”

Collaborative citizenry for job creation

Medo will shortly launch another incubator, focusing on the mining and heavy industries sectors. This programme will provide training and support for smaller businesses in these sectors.

“The opening of the first youth incubator in the DTI programme is a significant milestone in the effort to create and sustain jobs in South Africa, adding value to the growth of business and entrepreneurship in South Africa,” said Davies.

The minister said the country needs a “collaborative citizenry” to develop youth initiatives to combat high unemployment.

“The roll-out of the incubation support programme is an important dimension. The main touchstone of all economic policies is youth unemployment. The fundamental problems of unemployment are structural and we need opportunities for productivity in the economy.”

“There is a youth bulge and more and more young people are entering the job market each year. There needs to be intervention by government – holistic, comprehensive responses to the youth. South African society needs to see an increased contribution of youth entrepreneurship to the GDP (gross domestic product) and an increase in youth-owned start-ups.”

The DTI Youth Directorate has developed a 10-pillar strategy to help reduce youth unemployment. It includes:

  • Business incubation for young entrepreneurs
  • A support centre for youth-owned businesses
  • Competitions and awards for young entrepreneurs
  • Sector-specific youth catalytic projects
  • A national youth services programme
  • A “Take a young person” to work programme
  • A youth entrepreneur collateral fund
  • Youth enterprise data and research programmes
  • An entrepreneurship coaching and mentorship programme
  • Business development support services

The Medo philosophy is “building the economy one job at a time”. Since November 2011 the organisation’s mobile entrepreneurship centre, Treppie, has helped more than 17 000 potential entrepreneurs.

The organisation has delivered its one-day business opportunity identification workshop to 1 800 budding entrepreneurs across the country and supported more than 600 black business owners through its enterprise and supplier development programmes in the mining, manufacturing and hospitality industries.

The group’s research shows that 61% of those benefitting from its programme are younger than 35.

“In 2014 we will be opening 19 incubators across South Africa, starting with a mining industry incubator in Middelburg,” said Sandrock. “This incubator will be jointly sponsored by the DTI, BHP Billiton Coal and Hatch Goba. These 19 incubators will serve the mining, manufacturing, energy, ICT and hospitality industries.”

Davies said the government is trying to bring about a major change, a shift in business in South Africa.

“We are in a space of change – fast-paced technology. The opening of Medo is a milestone in incubation. There will be many more of these and hopefully they will crack the burden of youth unemployment.”