Wednesday, 24 July 2013

Tech Bite: A golden-gate for small businesses to raise funds


Many young African entrepreneurs fall victim to giving up on their businesses or ideas which could potentially see the continent economically transform due to a lack of capital or acquiring investment. A perfect example is a friend of mine who grow tired of being an informal trader, selling counterfeit DVD’s on the ever busy streets of Johannesburg. 

What my friend Thabo Nonyane ever wanted was to become an entrepreneur and not being educated and without business knowledge to turn idea into a success, he gave up on what he once believed in.
The great creation of the internet has over the past decade given birth to too many global trends and has made communication relatively easy. The story of my friend who gave up on his formal business idea led me to research on a great way of acquiring funding using the internet through crowd-funding.

Crowd-funding is a collective effort of individuals who network and put their money using the internet to give support to business start-ups, non-profit organisations or funding a cause.Instead of rushing off to a financial institution for back up, many young driven entrepreneurs and inventors across the globe with a multi-billion idea have resorted to Crowd-funding. Two South African entrepreneurs Jaco Kruger and Jean Van Der Merwe, co-founders of Chrome Cherry Design Studios in Cape Town used Crowd-funding to acquire investment for their business which invented a trike that teaches kids to ride a bike and also assist with developing gross motor skills.


 the co-founders of Chrome Cherry Design Studios, Jean Van Der Merwe and Jaco Kruger

Computer publication PC World reported on its online publication that Mark Shuttleworth’s company Canonical aim to merge the desktop computer and mobile device into a smartphone device which is to join the dodge smartphone market in May of 2014. The company will use crowd-funding to get the device off the ground with the aim to get a funding of $32 million (R320 million), talk of AMBITION.

Like many other entrepreneurs with innovative ideas, Mark Shuttleworth is using the trend to land up capital to fund an idea, a route my friend could have utilized to further his business had he didn’t give up.

Non-banks are gaining momentum globally as banks have increased interest rates or pull back from lending to small businesses. Off course like any other banking or business funding system crowd-funding has its own Pros and Cons, but no matter the reason funding shouldn’t be the main reason why future Mark Shuttleworthsdo not emerge for any corner of the globe.

Ashley Mokwena
@ashfonik

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