Setting up a venture fund in 2020 was a “huge paradigm shift” for Stellenbosch University in South Africa, because, for the first time, the executive leadership at the institution became interested in spinouts, says Anita Nel, the chief director for innovation and business development, because they understood that academic research had commercial value and a way to build, for example, local pharmaceutical expertise (the country had to wait six months longer than the northern hemisphere for a covid-19 vaccine because there were no vaccine developers or drug discovery companies in all of Africa).

External investors have taken note too: since the University Technology Fund (UTF) was launched with the backing from public-private investment vehicle SA SME Fund, there have been “hundreds of millions of rand” (ZAR100m = $5.4m) invested in the startups incubated by the university, says Brandon Paschal, the deputy director for spinout companies and funds who is also in charge of incubator LaunchLab.

The fund is a first not just for Stellenbosch University or South Africa, but for the whole continent because it invests solely in university spinouts from Stellenbosch University and the University of Cape Town (while University Mohammed VI Polytechnic in Morocco also has a fund, UM6P Ventures, though that one invests in startups across Africa).

The first University Technology Fund, which raised ZAR230m, has been deemed a success. Now, a second fund is being raised with one key difference: it will be a national fund after Nel overcame early hesitancy from other tech transfer offices in the country.