This feature story is an outcome of infoDev, a multi-donor program administered by the World Bank Group, with a focus on entrepreneurs in developing economies.
This story was originally published on April 9, 2018.
In 2011, there were virtually no technology-focused start-up incubators or accelerators in South Africa. Since then, the country has become a hotbed of entrepreneurial activity, hosting high-profile conferences like the Global Entrepreneurship Congress, and convening investors, high-growth start-ups, and other stakeholders in the digital entrepreneurship space, as witnessed during the XL Africa and African Angel Investors Summit at the end of 2017.
Throughout this time, Derrick Kotze has had a front-row seat as CEO of mLab Southern Africa. mLab SA was launched in 2011 as a mobile technology laboratory and incubator. Since then, it has grown to provide tech skills development training, and has broadened its mandate by adopting a hybrid model – skills for incubation and acceleration.
From its base in Tshwane near Pretoria, mLab has launched programs in three townships throughout the Gauteng province (which includes Pretoria and Johannesburg) as well as other cities like Cape Town in the Western Cape province. This year, the organization will continue its expansion into three other more rural provinces, primed for building new digitally focused ecosystems.
Along the way, the mLab’s leadership team has taken an iterative and agile approach to provide tailored support to different stakeholder groups and remain demand-focused in each new location. Looking back, Kotze shared some of the insights and lessons learned that have shaped the lab’s evolving business model.
Hype sells, but targeted support builds commercially viable ecosystems
“We started out with a lot of energy and riding the wave of excitement, with short-burst, high-energy events — hackathons, pitch competitions, and other platforms,” Kotze said.
These events are great for profiling your organization, gaining exposure for start-ups, and building confidence among potential entrepreneurs and developers who are considering moving into this space. However, while an important part of the ecosystem, high-profile events do not necessarily produce tangible outcomes, he said.
Kotze continued, “You can do those things, but don’t expect real ROI. The digital space is a very technical space. You need talent. You need time. You need skills and processes. There’s a lot of asset development and validation that’s required either parallel or even before you start trying to develop start-up incubation.”
mLab SA quickly became more targeted about the services it offered and more selective about the start-ups it supports.
“In the beginning, we were 100% supportive of every idea, but as an organization, we also have responsibilities to ensure results for our beneficiaries and stakeholders,” Kotze said. “So we’ve been stricter around the selection process, how we measure progress, what we expect from the teams, and where we try and focus our support.”