Cape Town Tech exits – billion-rand deals cement city’s VC leadership
By Larry Claasen
CAPE TOWN is once again proving itself to be a hub for tech innovation in the country, as several of the Mother City’s companies have been sold off for billions of rands.
There were several Western Cape companies like Gyft, GetSmarter, OrderTalk, Yoyo, Entersekt, PayFast, Quicket that were sold off between 2009 and 2026 according to the South African Venture Capital Association (SAVCA): Exit & Performance Analysis, which looked at 226 exits for the period.
Though some of these companies did not disclose the amounts they were sold for, payments-processing service provider PayFast was sold for over R1 billion. For its part, online short-course platform GetSmarter was sold for R1,4 billion.
No exact figure was given for digital gift card platform, Gyft, but the report estimated that it was sold for between $50 million to $100 million, which equates to around R800 million to R1,65 billion.
These latest exits build on the disposal of several technology companies over the past three decades. Mark Shuttleworth’s sale of digital certificate issuer Thawte to VeriSign in 1999 earned him R3,5 billion. That deal was followed by Stellenbosch-based mobile payment group Fundamo to Visa for R743 million in 2011.
The emergence of stronger exit evidence is significant because exits are the mechanism through which venture capital (VC) proves its ability to recycle capital, reward risk and attract new investment into the ecosystem, said SA SME Fund CEO Ketso Gordhan.
“South Africa has long had entrepreneurial talent, credible founders and strong technology capability. What has been less visible is the proof that investors can realise meaningful returns from backing these companies. These studies show that the exit market is no longer theoretical. It is starting to happen, and it is happening across different pathways,” says Gordhan.
The Western Cape’s prominence in the funding of emerging businesses can also be seen in Wesgro’s report, ‘Venture Capital: A Strategic Investment Opportunity in Cape Town & the Western Cape’ (July 2025).
The Wesgro report said, in 2023 alone 92 South African start-ups raised $162 million through 184 deals supported by 72 active funds, driving the VC asset class to $597,4 million, up 17,8% year-on-year.
“Over the period, the Western Cape drew more than half of South Africa’s VC activity – 49% by value and 55,6% by deal volume – cementing its role as the heart of South Africa’s start-up ecosystem.”
Wesgro said Cape Town ranks among the top emerging start-up ecosystems worldwide, and that about a third of South Africa’s fund manager offices are in the province, with Cape Town and Stellenbosch attracting significant VC decision-making capacity and deal flow.
It also noted that the region had specialised clusters in fintech, edtech, agritech, healthtech, traveltech, and e-commerce that offer sector-specific growth opportunities and attract targeted investment.
SAVCA pointed out in its report that on the whole, the VC sector was starting to mature and was moving beyond isolated success stories – there was a 12-year gap between the Thawte and Fundamo exits – towards a more mature investment market capable of attracting greater institutional capital.
“The research also found that South African VC has delivered realised return characteristics broadly in line with those observed in more mature markets, including the US, the UK, Europe and India, providing growing evidence that venture capital is becoming an increasingly attractive asset class for long-term investors,” it said in its Exit & Performance Analysis.
The VC sector was delivering as an investment class as it found that realised cash returns substantially exceeded invested capital, with capital-weighted realised returns ranging from 2,01x to 2,45x invested capital across the scenarios analysed.
The accompanying Exit Case Studies Analysis found that the sampled exits delivered a median gross internal rate of return (IRR) of 54%, a median gross money-on-invested-capital (MOIC) of 3.5x, and a median valuation at exit of approximately R1,6 billion.
Collectively, the exited companies created more than 4,000 direct jobs, averaging around 230 South African jobs per company, highlighting the broader economic impact of South Africa’s high-growth scale-ups.
