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Finally, a focus on early stage entrepreneurs

Entrepreneurship in South Africa faces many challenges. Early stage entrepreneurs in particular are generally ignored. An entrepreneur with a killer concept will only tend to attract funding once the business has existing revenues. Now for the first time in South Africa, selected entrepreneurs will be able to fast track their business ideas into commercial realities.

Seed Engine is a business accelerator developed for entrepreneurs by entrepreneurs who understand what is necessary to make a start-up successful.

The accelorator programme begins with a search to find the ten best distinctive and disruptive business concepts that deserve a chance. Once the final selection has been made, ten teams of entrepreneurs will begin a life-changing journey through a 13 week business boot camp where they will each be given R100 000 start-up capital to convert their ideas into practical business plans ready for launch. They will be offered coaching, mentorship and support and an opportunity to grow their concept into a business. On completion of the programme they will be introduced to an auditorium filled with potential investors so that they can attract further funding.

What’s an accelerator?

An entrepreneurship accelerator is like business and personal boot camp for entrepreneurs. The concept of accelerators has become a global phenomenon, driven by successful entrepreneurs and investors.

The Seed Engine accelerator model includes seven main features:
1. A highly competitive application process
2. Seed capital in exchange for equity
3. Focus on small teams, not necessarily one founder
4. Intensive mentoring and a fixed calendar of events
5. An average of ten ventures per accelerator programme
6. Introduction to investors for further funding
7. International exposure.

Angel investors and venture capitalists take a keen interest in these accelerator programmes because they create a pipeline of investable companies, filter top talent and connect them to disruptive opportunities.

The primary investment principle at any stage of investment is the assessment of risk. Typically, in the South African context, investors are known to have a low appetite for risk. Seed Engine has therefore developed its accelerator programme to significantly reduce the risk profile of the accelerator participants and improves their chances of success, as well as giving them the opportunity to raise additional capital for their ventures. 85% of entrepreneurs going through accelerator programmes in the USA are still trading after four years since inception.

Search for entrepreneurs

Anyone can enter by going to www.seedengine.co.za and completing the application process.
Applications are open until end November 2012. The application should clarify points of difference, scalability, disruptive strategies and team details.

Testing

A shortlist of candidates will be invited to interviews where a series of thinking and entrepreneurial ability tests will be completed prior to acceptance into the programme.

The Seed Engine Accelerator Programme (13 weeks, 3 times a year)

Programme
Candidates will take part in a structured learning and development programme. From Monday to Thursday, 4 – 6pm, a guest presenter will share a topic of relevance. These topics will include hard and soft elements of business including legal, marketing, leadership, accounting, negotiations, general “how-to” and other modern business practices that are relevant for both start-up and growing businesses.

Space
Successfully appointed entrepreneurs will be given a permanent workstation and shared office facilities for the duration of the programme. The workspace is designed to foster and inspire creativity. It is being modelled after business spaces found in Silicon Valley where the most well known companies are found that are renowned for their disruption and innovation. The Seed Engine workspace in Sandton will have everything that an entrepreneur would need, from working areas to meeting rooms, chill rooms and a training centre to host learning seminars. The secure premises allow entrepreneurs to work 24 hours a day, 7 days a week.

Coaching
The coaching team has developed a programme that aims to develop entrepreneurs with sustainable leadership skills. This specifically developed programme is a major differentiator from other incubator programmes, as it does not only focus on the business aspects, but also on leadership skills and values.

Mentoring
The Seed Engine team is made up of successful entrepreneurs and venture capitalists who provide daily guidance to the entrepreneurs. External mentors will also be selected on the basis that they have specific industry knowledge, expertise and experience as well as potential appetite to invest in second round funding of the business at presentation day.

The business plan
At the end of the programme, Seed Engine, together with the entrepreneur, would have compiled a realistic, executable and deliverable plan for the business to implement. The plans would have been stress-tested and researched to ensure that they are reasonable and can be delivered within certain time frames.

Presentation day
The objective of presentation day is to allow the entrepreneurs to pitch their businesses to a group of targeted investors to raise capital to grow their businesses. These investors will include angel investors (individuals and clubs), early stage venture capital companies, family offices, private equity companies as well as corporates - either as a strategic investment or deployment of their enterprise development funding strategies.

It is envisaged entrepreneurs will be able to raise between R200 000 and R2 million at presentation day (per investment) depending on the business case presented. Entrepreneurs will be fully coached and trained for their pitches on presentation day.

Deal facilitation
Private meetings post-presentation day will be facilitated by Redwood Capital, a partner to Seed Engine, to assist entrepreneurs with the closing of deals and legal documentation.

Seed Engine and Redwood Capital’s involvement

Seed Engine, a business accelerator and Redwood Capital, a business active in incubation, venture capital and private equity will have board representation on each of the underlying businesses to ensure that momentum and execution of the business plan and general strategy will be carried out as envisaged. The management are well versed in entrepreneurial businesses.

It is in the interest of Redwood and the Seed Engine management team to increase the likelihood that the underlying businesses are successful, as they will hold equity positions in all of the accelerator ventures.

Corporate partners

The Seed Engine Accelerator is powered by proud supporters of entrepreneurship, as well as support for employment creation in South Africa. Corporate partners include:

Tiber, one of the largest private property owners and construction companies in South Africa, has provided Seed Engine with free rent for the first activation as well as assistance with the construction of the work space.

Redwood Capital Partners have provided Seed Engine with capital to develop the innovative work space. Additionally, the company will be mentoring the entrepreneurs through the activation process.

Urban Everest, a coaching and leadership facilitation company have joined Seed Engine to develop the accelerator programme and coach the entrepreneurs.

When do Seed Engine activations happen?

There will be three 13 week Seed Engine activations per year, starting in 2013:
• February – May (entries are now open and close end November 2012)
• June - August
• September - November

Who is behind Seed Engine?

Entrepreneurs Jeff Miller and Marc Elias, who having researched the South African market identified the need for such a venture. Both have a passion for developing a true venture capital and angel investor network that is lacking in the South African market. There is much talent in South Africa but not enough funding and platforms to launch some of the great and innovative opportunities that exist in the market.

Seed Engine
Seed Engine is a private company modelled on and inspired by businesses accelerators being rolled out across the USA, Europe and Asia. It is owned by management, Redwood Capital and private equity investors. The company is 25% black owned and qualifies as a Category B Enterprise Development Beneficiary for funding.

Marc Elias
Marc is the CEO of Seed Engine. He has assisted Redwood Capital to develop numerous ventures that have become marketable and trade worthy. Prior to joining Redwood Capital, he consulted entrepreneurs on business plans and funding development. He did so using the curriculum gained through the GIBS Entrepreneurship MBA, where he graduated in the top quartiles of the class and completed his MBA Electives at UIBE University in Beijing, China, which were geared for international entrepreneurship “best practice” and taking ventures to international markets.

Brad Shorkend
Brad is a serial entrepreneur, having founded numerous successful start-ups. He is an architect and business coach; with several leadership and coaching academic accolades under his belt. Brad has built an extremely successful leadership facilitation practice, dealing with some of South Africa’s most prominent corporates. His experiences as an entrepreneur and business coach are unparalleled in the market, ensuring impact in the environments he enters.

Jacqui Meyersfeld
Jacqui spent the bulk of her career building, developing and shaping the internal cultural practices of Investec. From there, she moved to start her own company, Evolve Consulting, providing coaching and facilitation services to clients in the banking, insurance and industrial services sectors. She is passionate about entrepreneurship and specialises in initiating key conversations that enable proper and wholesome foundation to start-up companies.

Redwood Capital
Redwood Capital is a venture capital, incubation, and private equity company. The Redwood team members are experienced start-up specialists, with a number of successful ventures under their collective belts. Their skills cover the manufacturing, retail, distribution, finance, mobile payments, innovation consulting and technology industries.

The Redwood Management Team has over 40 years’ hands on experience in start-up businesses, covering a number of industries. Their successes have been numerous, including but not limited to successful start-ups, trade sales, and listings on the JSE.

Jeff Miller
Jeff is the CEO of Redwood Capital. He will be providing on-going guidance and operational input to the underlying investments. His entrepreneurial experience includes the start ups of Bride & Co, Eurosuit, Balboa Finance, KNR Flatrock to name a few. He was also a co-founder of Brandcorp Holdings which was listed on the JSE in 1997.

Seed Engine Application