South African growth equity fund manager and advisory firm Knife Capital has received 87 applications for its Grindstone accelerator programme, with 10 startups to be selected next month to begin the process in January.
Grindstone is the company’s year-long entrepreneurial development programme, aimed at assisting post-revenue innovation-driven businesses in accelerating strategy execution. The programme does not charge a fee or take equity stakes in any participating company, but rather focuses on a long-term upside incentive of investing in participating companies via Knife Capital.
Applications for the second Grindstone programme closed on Sunday, with Knife Capital partner Andrea Bohmert telling Disrupt Africa 87 applications were received, which will be narrowed down to 20 companies this week.
“These top 20 companies will then attend a one-day workshop where we deal with the “Scale-up Process”, but also gives us an opportunity to interact with those companies that we don’t know that well and for all the companies to get to know each other,” Bohmert said.
“The companies will then be invited to complete our YueDiligence Assessment to identify where the gaps are that are holding back growth. Equipped with the results from the YueDiligence Assessment we will then invite the companies to present their business and reasons for joining Grindstone to us.”
Ten companies will then be selected to join Grindstone in January 2015, with Grindstone alumni and some strategic partners having an input into the selection process.
“We know that we are putting a lot of time and effort into the selection process but Grindstone is a big investment for Knife Capital in terms of time, resources as well as capital allocation and as with all investments – the selection of the entrepreneurs or businesses is key for the success of the investment,” Bohmert said. “Having looked at the diverse range of companies that have applied, we are very excited.”
Grindstone completed its first year in August, with Knife Capital saying all ten participating companies experienced significant business growth.
The companies saw an average growth of 61 per cent in year-on-year revenue, adding ZAR43 million (US$3.9 million) in revenues across the ten companies and doubling the number of key customers. 43 new, direct jobs were created, while the average increase in company valuation was 100 per cent.
“We set out to prove that by offering the right guidance and support to coachable entrepreneurs, we can engineer growth on a significant and sustainable scale,” said Bohmert. “The fact that all ten companies have experienced growth clearly demonstrates that is possible and the team is looking forward to taking everything that we have learnt into the next Grindstone programme starting in a few months.”
The companies that took part in the last Grindstone accelerator programme were Apurimac Media, Eluminary Inc, Framework One, iKubu, iono.fm, TR3DENT, ViewProtect, OfficeBox, Okuhle Media and One Moja.