Pretoria: The Department of Science, Technology and Innovation (DSTI) has voiced strong support for the government’s vision to enhance innovation, as highlighted by President Cyril Ramaphosa in the 2025 State of the Nation Address (SONA). The Innovation Fund is slated to be a key priority for the government in the 2025/26 financial year, with implementation overseen by DSTI Minister, Professor Blade Nzimande.
According to South African Government News Agency, President Ramaphosa emphasized the government’s commitment to advancing the Innovation Fund, which aims to support the growth of innovative startups and technology-driven Small and Medium Enterprises (SMEs). The President stated that the DSTI will establish the fund to provide venture capital to tech startups emerging from higher education institutions.
The DSTI launched the Innovation Fund in 2021 as part of a comprehensive initiative to foster innovation. The primary goal of the fund is to stimulate the development and expansion of the high-tech SME sector. It also aims to mitigate risks associated with early-stage SME creation, fostering a sustainable pipeline of viable, investable high-tech enterprises that can attract later-stage investments from the private sector.
The Innovation Fund targets various stages of the SMEs’ business development life cycle and is structured to drive public-private co-investment in high-tech SMEs. The fund model leverages investment expertise from institutions like the Technology Innovation Agency (TIA), the SA SME Fund, and the Public Investment Cooperation (PIC) to drive investment syndication with venture capital fund managers.
The objectives of the fund include leveraging private capital to attract additional private sector investments into South Africa’s innovation ecosystem, stimulating the development and commercialization of locally developed intellectual property, and providing support to early-stage startups and tech-enabled SMEs. It also aims to strengthen the infrastructure and support systems for innovation and venture building.
The DSTI has invested nearly R917.2 million in various investment intermediaries, successfully leveraging over half a billion in private sector co-investments. To date, the fund has supported 12 venture capital firms and approximately 96 technology investment opportunities and enterprises.
For SMEs looking to access the fund, more information is available at the Innovation Bridge portal. Current open calls can be found on the TIA website or the EPF Tech Fund site. Inquiries can be directed to Mr. Konanani Rashamuse at the DSTI.