South African accelerator Ignitor is accepting applications for two zero-equity accelerator programmes, planning to teach startups the lean mentality through backing from sponsors such as Microsoft and Standard Bank.
Interested startups can apply online for Ignitor, which says it helps startups grow using lean, coaching and mentoring. The programme includes a three-day bootcamp where entrepreneurs apply lean startup principles, 12-weeks of coaching with an experienced entrepreneur, and more than 50 online video modules.
Co-founder and chief executive officer (CEO) Paul Smith told Disrupt Africa Ignitor has so far had over 400 entrepreneurs attend its bootcamp, while the accelerator programme has helped turn 30 ideas into profitable businesses. Moreover, it costs nothing, as no equity is taken and startups’ costs are covered by sponsors like Microsoft, Standard Bank and the Allan Gray Orbis Foundation.
Smith said the Ignitor belief is that the South African startup community is different to many of the developed startup ecosystems around the world, with less early-stage funding and many entrepreneurs unfamiliar with startup “best practice” like lean startup, design thinking, rapid prototyping, effectual thinking and agile development.
Therefore, the Ignitor model – developed after two years of lean experimentation and over a decade of research into entrepreneur support programmes – has been developed to helps entrepreneurs start, build and grow their businesses while taking no equity.
“The accelerator differs from international programmes in that the key outcome of the programme is not funding, but rather helping entrepreneurs get to breakeven as quickly as possible,” Smith said.
“While a few of the participants have raised funding and Ignitor does help with investor introductions, the main focus is profitability and building sustainable, growing businesses.”
He said Ignitor was started to help solve the problem of poor support for entrepreneurs.
“The model we have settled on helps us to find the great early stage entrepreneurs and teach them best practice of starting companies, as well as give them access to a network of experienced mentors. And we do this at a much lower price than our competitors,” Smith said.
Ignitor’s long-term aim is to improve the quality of early stage support for entrepreneurs and eventually give thousands of committed entrepreneurs in South Africa access to the best ideas around starting a business and high quality mentoring.
Smith said its primary revenue was sponsorship money, with a focus on three customer segments: organisations looking to support programmes that create jobs, large enterprises looking for enterprise development points for their BEE scorecard, and marketing departments looking to get exposure to the SME market.
He did not, however, rule out the idea of taking equity in startups in the future.
“As our ability improves to attract and support better early stage entrepreneurs we may look to start angel investing in the future.”