Is Cape Town a Good Place to Launch a Startup?

Where you start your company still matters – but sticking too closely to one location might limit what you’re able to build. In today’s startup landscape, geography shapes your path – but it doesn’t have to define your potential.

Cape Town has emerged as a strong hub for entrepreneurship, offering access to funding, talent, and infrastructure. But with growing competition, rigid local programmes, and support often reserved for the most polished startups, relying solely on what’s nearby can slow you down – or hold you back.

In this article, we’ll explore what Cape Town gets right – and where founders often run into friction. We’ll also show how EWOR offers an alternative: a global, remote-first platform that gives you access to funding, mentorship, and community – no matter where you’re based.

1. Access to Funding in Cape Town

Funding is one of the most critical ingredients in building a successful startup – and Cape Town offers a growing ecosystem of support. From venture capital firms to government grants and angel investors, founders in this region have several pathways to raise capital and gain early traction.

Cape Town's early-stage funding scene is dynamic, with notable players like VC firms 4Di Capital and Newtown Partners actively investing in tech startups. Angel networks also contribute, with groups like Jozi Angels having invested in Cape Town businesses. Government support exists through initiatives like the R300 million Seed Fund of Funds, a collaboration involving entities like the SA SME Fund and the Technology Innovation Agency (TIA), specifically aimed at addressing the seed-stage funding gap in South Africa. Despite these resources, challenges persist. While overall VC investment in South Africa saw growth in 2023, reaching over R3 billion, the early-stage still faces hurdles, including a historical focus on later-stage investments and a significant drop in overall African VC funding in early 2024. Securing that initial seed capital remains a key challenge for many local founders.

A More Flexible Path Forward

In the wake of these challenges, founders don’t have to rely solely on local funding options. EWOR offers a more flexible path – providing up to €500,000 in early-stage capital But EWOR is more than a cheque. Our capital comes bundled with personalised support, investor-ready storytelling, and access to a network of over 400 active European investors – many of whom regularly participate in our Grand Pitch events. On average, EWOR fellows who complete the programme and pitch go on to raise €2 million in follow-on funding – over 10x more than founders from comparable European initiatives.

2. Innovation and Startup Culture  

Cape Town has become a centre of innovation, with numerous tech hubs, coworking spaces, and accelerators that foster creativity and new ideas. The local startup culture is vibrant, with a growing community of entrepreneurs working together to push the boundaries of what’s possible.

Cape Town has a vibrant and growing startup ecosystem with a strong culture of innovation and creativity. The city boasts a thriving network of coworking spaces like Workshop17 and Neighbourgood, catering to various needs from hot desks to private offices. Numerous tech events and conferences are held throughout the year, fostering networking and knowledge sharing. The ecosystem supports entrepreneurial activity across diverse sectors, including Edtech, Fintech, and Marketing & Sales. While there are accelerators and incubators that support early-stage startups, some programs also cater to more mature companies. There are resources and programs aimed at supporting entrepreneurs at various stages, including those focused on early-stage and finance readiness.

For many entrepreneurs, the energy and resources available in Cape Town can provide the ideal environment to test new ideas and gain early traction. The collaborative atmosphere allows founders to connect with fellow innovators and build networks that can help their startups grow.

While the local startup culture is vibrant, the support founders actually receive can be hit or miss. VCs might offer funding but little time. Angel investors often give advice, but it’s scattered and inconsistent. What’s more, many accelerators rely on a one-size-fits-all model that doesn’t reflect the needs of exceptional founders. In fast-moving, competitive ecosystems like Cape Town, standing out is hard enough – getting the right kind of support shouldn’t be.

The Alternative to Cookie-Cutter Programmes

Finding a programme that truly adapts to your journey, not the other way around, is rare. However, EWOR offers the kind of depth and flexibility that many local programmes simply can’t match. Instead of following a fixed curriculum, our fellowships are modular and tailored – giving you the right support at the right time, based on where you are in your journey.

But the real strength of EWOR goes beyond structure. Fellows often describe the community as the most unexpected – and valuable – part of the experience. As some have put it: “The real magic lies in the community: the kind of conversations, insights, and connections that lead not only to breakthroughs – but to lasting friendships with some of the most fascinating people they’ve ever met”.

3. Talent and Workforce Availability

One of the greatest assets of launching a startup in Cape Town is access to a skilled and diverse talent pool. With universities producing top-tier graduates in technology, business, and other fields, startups can tap into a wealth of expertise to help grow their teams.

Cape Town has a strong talent pool for startups, supported by several world-class educational institutions like the University of Cape Town, Stellenbosch University, and Cape Peninsula University of Technology. These universities produce graduates with in-demand skills, particularly in STEM fields, including software development (Python, JavaScript), data science, AI, cybersecurity, and cloud computing. Beyond technical skills, there's also a focus on essential soft skills like problem-solving and adaptability. This local talent supports entrepreneurial growth by providing skilled individuals for key roles, contributing to innovation, and fostering a vibrant tech ecosystem. Incubators, accelerators, and networking initiatives further connect talent with startup opportunities.

Like funding, competition for talent can be fierce, especially for highly specialised roles in fields like software development or AI. For startups looking to scale quickly, hiring the right people at the right time can be a challenge, leading some founders to look outside the region for remote talent solutions.

Get Global While Local

While hiring locally in Cape Town can be competitive and slow, EWOR gives you instant access to a global network of exceptional talent. Built by founders for founders, the EWOR team has launched and exited companies worth over €12 billion – and they bring that experience directly into your venture. It's not just about funding or surface-level advice; it's akin to having a co-founder from day one. 

The team collaborates closely with you to refine your idea, challenge your thinking, and support you through real-world decisions – just like a hands-on partner would. Moreover, with EWOR’s exclusive co-founder pool, you can find the right person to build with, regardless of their location.

4. Infrastructure and Support Systems

Cape Town boasts a strong infrastructure that supports the growth of new businesses. From modern office spaces to high-speed internet, entrepreneurs have access to everything they need to run their startups smoothly. Government policies may also provide tax breaks, legal support, and other incentives that make starting a business more attractive in this region.

Cape Town offers a robust ecosystem for startups, featuring numerous co-working spaces, accelerators, and incubators like CiTi and Impact Amplifier. These provide essential resources, mentorship, networking, and access to funding, helping businesses grow. The city boasts strong IT infrastructure and a skilled talent pool from local universities. Government initiatives, such as those from the Western Cape Government and the City of Cape Town's Small Business Support Office, offer financial incentives, loans, grants, and mentorship programs. National bodies like the Small Enterprise Development Agency (Seda) also provide extensive business development support. These combined resources foster innovation and contribute to the thriving startup scene.

But what looks good on paper often proves more complicated in practice. Bureaucracy can be time-consuming and opaque, especially for first-time founders unfamiliar with local laws. Incorporation takes longer than expected. Accessing public funding often means navigating slow processes, strict requirements, or hard-to-reach advisors. And operational costs – from accounting to regulatory compliance – can quickly eat into early budgets. 

A System That Moves With You

With access to expert guidance, practical legal resources, and a network of experienced entrepreneurs who’ve built across a range of regulatory systems, EWOR is well positioned to help founders navigate the bureaucratic and legal complexities that often come with building in Cape Town. Instead of wasting time figuring things out alone, you’ll have the tools and support to stay focused on what matters most – growing your venture.

And while we’re remote-first, our support is anything but distant. Through in-person gatherings like the EWOR House, city-based meetups, and our twice-yearly Grand Pitch event, you’ll still build meaningful relationships with investors, peers, and mentors. It’s a system that helps you focus on building – not just dealing with paperwork.

Can Cape Town Be Considered the Best Place to Launch a Startup?

There’s no doubt that Cape Town provides a vibrant environment for startups, with access to funding, innovation, talent, and infrastructure that can help entrepreneurs build successful businesses. For many, it’s a strong contender for the best place to launch a startup, thanks to its growing entrepreneurial ecosystem and support systems.

Entrepreneurs launching startups in Cape Town face several challenges. Competition is strong across various sectors, with many niches becoming saturated due to the city's entrepreneurial spirit. The cost of living, including rent and utilities, can be expensive, particularly in desirable areas, impacting operational costs. Regulatory issues in South Africa, such as complex labor laws and evolving compliance requirements like POPIA, can also pose hurdles for businesses. Navigating these regulations requires staying informed and adapting to changes.

However, it’s important to remember that the location of a startup is no longer the be-all and end-all. In today’s digital age, location-independent options like EWOR allow entrepreneurs to access world-class mentorship, funding, and resources from anywhere in the world. Whether you’re based in Cape Town or elsewhere, EWOR’s remote programmes are designed to support founders no matter where they are located.

So, while Cape Town offers significant advantages, it’s worth considering options like EWOR that enable you to launch and scale your startup with global support – whether you’re in the heart of a bustling startup hub or working from a quiet corner of the world.

Image credits: by Andreas Brücker on Unsplash