💰 Unlocking R15bn+ in SA Learnership Budgets...
Shop like an astronaut? China has unveiled Haolong, its new unmanned reusable space shuttle which some say looks like a knock-off of NASA’s retired one 🤭. We can only imagine that’s what happens when you buy a spaceship from Temu.
In this Open Letter:
- The local play: How to unlock R15bn+ in SA learnership budgets.
- SA’s young science guns, GitHub’s billion dev plan & Naspers’ earnings.
- Founder’s secret weapon: From MVP to massive scale in 5 months.
- How good SA is at growing food: The results are in.
- Short on ideas? Share this and get 100+ SA startup ideas.
Together with:
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TRENDING NOW
Solving SA’s Jobs Crisis with 4.8 Million Subsidised Employees
The youth in SA are up against it…
Youth unemployment is at 45.5% – nearly 5 million of SA’s youth (between the ages of 15 and 34) are sitting at home. And while some of them may be hustling it out, they’re not part of the formal economy.
Concerningly, nearly 1 million of them have given up hope of ever finding a job, with unemployment introducing a whole host of other social challenges.
A solution right in front of us…
Many matriculants aren’t able to study at a university. But when they hit the job market, they’re asked what experience they have – which is obviously none.
I mean, if you say so, Thor…
So they’re caught between a rock and a hard place – which is where learnerships come into play. Together with the qualification component, they can also gain meaningful work experience.
The government actually has a plan for that
In SA, we have a Skills Development Levy imposed on companies with a salary bill of more than R500k per annum – worked out at 1% of the total amount paid in salaries. This SDL is meant to develop and improve employee skills.
80% of this SDL levy is disbursed via the various Skills Education Training Authorities – SETA’s.
There are more than 20 SETA’s, each with its own sectors and sub-sectors and comprising a variety of economic activities that are related. So you’d have the BANKSETA for the Banking Sector, the MICTSETA for the Information and Communications Technology sector, the TetaSETA for the Transport sector, and so on…
But here’s the thing…
There’s a nice incentive for employers running learnerships in the form of an annual allowance and a once-off completion allowance, once the learner has completed their learnership.
Depending on the NQF (National Qualification Framework) level of the learnership (matric is level 4, BTW), employers can claim between R40k and R80k per learner per year, and as much as R120k for disabled learners.
That’s between R3’333 and R10’000 per month per learner – not bad for someone who’s getting a qualification and some on-the-job training – not to mention the extra set of hands your company has to get the job done…
What’s more, companies that run learnership programmes can get 6 points towards the 20-point skills development component of their BEE scorecard…
With between 2.4 and 3.5 million small and medium enterprises (SMEs) operating in South Africa, imagine what SA’s youth unemployment rate would look like if each SME took on just one job seeker…
The local player bringing learners, trainers, employers and more together…
But with government processes comes admin and know-how. That’s where the local training management system Inala comes in. They built a platform for connecting and enabling this ecosystem of government programs and the private sector (both training programs and employers):
- The Learner: an unemployed youth from a previously disadvantaged background
- The Host Employer: hosts the learner in the workplace.
- A Training Provider: the organisation that will provide the training.
- The Facilitator: to conduct the training.
- The Workplace Mentor: offers guidance and support in the workplace.
- The Assessor/Moderator: ensures that the learners are actually growing their skills.
- The Funder: funding these learning projects.
- And lastly the Skills Development governing bodies: SETA/QCTO.
The platform has a whole host of features including:
- The ability to build out your programmes, and track learner attendance, progress and competency to identify learners at risk of dropping off.
- Manage programme facilitators and training scheduling.
- Manage a digital portfolio of evidence submissions in a paperless environment (good for the actual environment).
- Advanced customised dashboards for reporting and compliance.
We recently chatted to Inala Co-Founder Jason Schwegmann and only 52% of SA’s SMEs are actively claiming back their SDL contributions, leaving billions in unclaimed funds on the table each year. Unreal…
With platforms like Inala, stakeholders in the training industry can scale operations, train more learners, and reduce dropout rates through a centralised platform, bringing key role players together to boost employment opportunities for SA’s youth.
We’re watching this space…
CHECK THIS OUT
From MVP to Scale in 5 Months
Remember in June this year when we told you about LeaseSurance, the startup that’s making rental deposits a thing of the past?
They’re now an SA Startup of the Year finalist.
But here’s the part you didn’t know: Just a few months before we wrote about them, the product was basically still an MVP – good enough to get some initial validation, but nowhere near ready for scale.
And scale is what they needed… in PropTech, margins are low, so you need high volume and fast, but you also need to trim admin and operational costs down to the bone.
So founder Paul Schaefer did something not every SA founder knows about…
The new way to build in SA
Instead of doing the obvious: Getting a dev agency on board or (eek!) trying to build a team internally, Paul opted to get a crew of engineering devs on the job…
He went to Octoco (which stands for outsourced CTO) and, as the name suggests, it’s your next step up from your average developers – a distinction we don’t make readily enough here in SA, but Paul knew that if he wanted to build an actual business fast, engineers were the way to go.
From March to July this year, Octoco rebuilt LeaseSurance from the ground up, enabling real-time data integration, streamlined claims automation, and seamless user and transaction management – see the full details of the project here.
The special forces of SA Tech
Within 5 months, LeaseSurance was streamlined, operations optimised enough that Paul could see a route to profitability and – most importantly – it was set up so that Paul and his team could focus on one thing: scaling.
“The results are immediately visible,” Paul explains. “We’re servicing existing clients faster and onboarding new ones with ease. Our ability to handle client portfolio growth has significantly improved, all while maintaining financial viability.”
Serious about ensuring your greatest chance of success?
IN SHORT
Some tech titbits to enjoy…
🇿🇦 Young Science Guns. Two Grade 11 South African scientists will fly the flag at this year’s İzmir International Innovation Science Energy Engineering Fair (IISEEF) taking place in Turkey from the 30th of November to the 3rd of December. The two projects they’ll be showcasing set out to enhance our understanding of exercise physiology and present a viable alternative for sealing wounds respectively.
🛒 Soaring e-commerce. The tide is turning for ecommerce in SA according to new data from Absa. The average value of e-commerce transactions has increased from R350 to R430 from the start of 2023 to Q3 in 2024, while the average value of physical store transactions has dropped from R350 to R340 over the same period.
🤖 DevBots. GitHub’s CEO Thomas Dohmke has shared that the integration of AI tools into the collaborative development platforms toolset will help it grow its user base from 100 million to a billion (human) software developers over the next 10 years.
💸 MVC. SA’s most valuable company, Naspers, is expecting strong results for the 1st half of the 2025 financial year. The expected strong headline earnings per share jump of between 87.2% and 84% is attributed to the growth and enhanced profitability of its e-commerce operations and equity-accounted investments, especially Tencent.
🎯 The Stack. Founders need tools and suppliers they can trust. Check out our Founder’s Stack with easy-apply R5M business funding from Lula, next-level authority building with Stream and loads more vital startup tools & services.
BUILDING TOGETHER
Happening over at The Open Collab
In the last few days alone, in our online community, we…
- Discussed the Checkers Sixty60 driver controversy and speculated about SA’s true unemployment levels.
- Discovered that HubSpot offers significant discounts to startups 😮.
- Shared a list of 26 startups that YC thinks the world really needs right now.
- Delved at tech to solve government efficiency concerns VS long pay cycles in that space.
- Got our invites for Friday’s product masterclass 🚀.
- Discussed Norway’s questionable startup taxes and how this can dampen innovation.
- Helped Enrco find a solution for blocking unwanted WhatsApp calls.
Thinking about joining The Open Collab?
- Supercharge your network in the SA startup landscape — get that introduction, get that customer, or meet that partner.
- Get feedback on your products, services and/or offers from others who have built and are building their own products right now.
- Join all our online and in-person events for free!
- Exclusive 1-on-1 sessions with startup consultants.
SA’s only dedicated tech startup and scale-up founder community.
HAPPENING SOON
Upcoming Events
22 November 2024 — Product Masterclass — Online: Part 3: The tools, frameworks and habits of exceptional product teams with SA product legend Roger Norton — join The Open Collab community to attend for free.
29 November 2024 — Sales Masterclass — Online: Part 3: Keep your B2B sales pipeline filled with this Masterclass session with sales expert, Sebastian Chapman — join The Open Collab community to attend for free.
6 December 2024 — AMA with Alan Knott-Craig: After our LinkedIn Live with Alan, you voted to an Ask Me Anything session — join The Open Collab community to attend for free.
View all our upcoming events here.
WHAT YOU SAID
Home-grown greens…
We asked if you had ever tried growing your own veggies, and at least we all tried…
🟩🟩🟩🟩🟩🟩 😅 Yeh, no that didn’t go so well. (47%)
🟨🟨🟨⬜️⬜️⬜️ 🍅 Of course, you should see my 2-pound tomatoes! (25%)
🟨⬜️⬜️⬜️⬜️⬜️ 🥗 Why on Earth would I? The Spar is like, right there. (10%)
🟨⬜️⬜️⬜️⬜️⬜️ 🍃 Oh I’ve grown a LOT – just not the edible kind. (12%)
⬜️⬜️⬜️⬜️⬜️⬜️ 😮 Oops, just remembered I forgot to water mine, since Covid! (6%)
Your 2 cents…
That’s awesome, Jason! 🌱 Even tiny pepper plants are a win. Replanting can be tricky — maybe AgriLogiq needs to expand into backyard SOS kits! 🚜
Wow, you’re doing great, Sakhile! 🌿
Thanks so much, Lara! That’s high praise, and we’re honoured to make the cut. 😊