Is South Africa 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.

South Africa 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 South Africa 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 South Africa

Funding is one of the most critical ingredients in building a successful startup – and South Africa 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.

South Africa's early-stage funding landscape is dynamic, with various players supporting local founders. Notable VC firms active in this space include 4Di Capital and Newtown Partners, which focus on early-stage technology investments. Angel networks like Jozi Angels and the South African Business Angel Network (SABAN) also play a crucial role in providing seed capital and mentorship. Government support is available through initiatives like those offered by the Technology Innovation Agency (TIA) and the National Youth Development Agency (NYDA), providing grants and support programs. Despite these resources, challenges persist, particularly a notable seed-stage funding gap, as the ecosystem has historically focused more on later-stage investments. While overall African startup funding saw a significant downturn in 2024, with a 25% decrease from 2023, there's a growing trend of increased local investor engagement in South Africa.

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  

South Africa 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.

South Africa has a vibrant and growing startup ecosystem, particularly in cities like Cape Town and Johannesburg, with a strong culture of innovation and entrepreneurship. Coworking spaces are prevalent across major cities, offering flexible workspace and networking opportunities. The country hosts numerous tech events and conferences throughout the year, covering various sectors like Fintech, AI, and Digital Marketing. While the ecosystem is maturing, access to funding remains a challenge, especially for early-stage ventures. Support for founders includes incubators, accelerators, and angel investors who provide capital, mentorship, and networks. Some programs, like Founders Factory Africa and Savant, offer tailored, hands-on support to early-stage startups, indicating a move beyond just standardized programs.

For many entrepreneurs, the energy and resources available in South Africa 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 South Africa, 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 South Africa 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.

South Africa has a diverse talent pool supporting startup growth, fueled by strong educational institutions like the Universities of Cape Town, Stellenbosch, and Witwatersrand, which produce skilled graduates in technical and business fields. There is a high demand for industry-specific skills, particularly in technology sectors such as software development, data science, cloud computing, and cybersecurity. Local talent contributes significantly to entrepreneurial growth by filling key roles and driving innovation, especially in areas like fintech, e-commerce, and green technology. While challenges like skills gaps and retaining talent exist, collaborations between academia and industry, along with government support, aim to enhance the workforce and foster a vibrant startup ecosystem.

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 South Africa 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

South Africa 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.

South Africa offers a growing ecosystem for startups with various support systems. Infrastructure includes incubators, accelerators like LaunchLab and Riversands Incubation Hub, and co-working spaces providing mentorship, training, and networking opportunities. These resources help businesses develop models, access funding, and scale. Government initiatives play a key role, with entities like the Small Enterprise Development Agency (SEDA) offering business development support and the Small Enterprise Finance Agency (SEFA) providing funding. The Department of Trade, Industry and Competition also offers grants and incentives. These initiatives aim to foster entrepreneurship and contribute to economic growth.

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 South Africa. 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 South Africa Be Considered the Best Place to Launch a Startup?

There’s no doubt that South Africa 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 South Africa face significant challenges. Competition is intense, with new businesses often competing against established corporate giants with vast resources and networks. The high cost of living and inflation impact both business operating costs and consumer spending power, potentially decreasing demand. Regulatory hurdles are complex, involving compliance with numerous laws like company registration, tax, and labor regulations, which can be time-consuming and costly for new businesses. Additionally, navigating specific regulations like Broad-Based Black Economic Empowerment (B-BBEE) can add complexity.

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 South Africa or elsewhere, EWOR’s remote programmes are designed to support founders no matter where they are located.

So, while South Africa 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