Hi there,

Cruelty-free? An Austrian biotech company looked at those de-extincted dire wolves and decided to skip the Jurassic Park “bring them back” phase and go straight for the money-maker: Announcing they’re developing “real” T-Rex leather for bags, purses, belts, whatever.

We tried phoning some scientists to ask if this is possible, but they couldn’t stop laughing long enough to answer us. 🤷

In this Open Letter:

• SA startup special: How to raise R3bn in funding (by the guys who did it).

• SA’s next president, (still) no Starlink for us & the last days of Skype.

• Fine-tuned skills: Vibe coding to vibe marketing & a better prompt guide.

• Know this SA township energy startup? The results are in.

• Lonely building your startup? Join The Open Collab and get support.

TRENDING NOW

How to Raise R3bn in South Africa

In a very special Tuesday edition, we’re giving you the chance to learn how to raise funding from two founders who’ve raised over R3 billion between them…

Capitec recently became South Africa’s most valuable bank when its R407 billion market capitalisation surpassed FirstRand’s R401 billion for the first time. A milestone driven by strong financial results, including a 66.97% increase in market cap over the past year.

The fascinating tale of arguably South Africa’s most successful digital-era “FinTech” is deepened by stories of the early days as you walk through its birthplace and still-headquarters, Technopark in Stellenbosch. Stories of founders and employees investing everything they had into the dream (there weren’t many VCs with big cheques back in the early 2000s). 

Over the years, those who held onto their early shares were handsomely rewarded as Capitec rose to become the 5th largest company on the JSE by market capitalisation.

Can SA repeat this? 

Financial services play a massive role in developing economies, and there is money to be made as countries grow. While SA has been growing slowly as of late, there’s reason to believe many a well-positioned FinTech could become the next Capitec story. But, just like with Capitec, building a FinTech requires a lot of capital.

While VC funding in Africa seems to have slowed down last year, with African startups securing $2.2 billion in funding (around R40 billion) in 2024, a 25% decline from 2023’s $2.9 billion (around R54 billion), it’s the fintechs that seem to stand out as the ones being able to land the big rounds:

And with big raises comes scale. An intensely complicated task, and that’s why our next event in Cape Town is bringing together two exciting FinTech co-founders who’ve raised over R3bn between them: Trevor Gosling (Co-Founder & CEO of Lula) and Kiaan Pillay (Co-Founder & CEO of Stitch), to hear their stories in Cape Town 22 May.

Here is a little preview of what to expect…

Covering a R540 Billion Gap

In 2019, the International Finance Corporation (IFC) estimated that South Africa’s formal MSME (micro and small enterprise) sector faced a R540 billion credit gap, with an additional R432 billion in unmet credit demand from the informal sector. The traditional banks often overlook these small businesses due to rigid criteria, outdated risk models or slow processes.

That’s where Lula stepped in, when it launched 10 years ago, offering funding of up to R5 million to small businesses. But since only 15% (or about half a million) are formalised, a potentially even bigger opportunity is to offer innovative banking solutions to these businesses to help them formalise. That’s why Lula launched a business banking offering with a zero monthly fee option (for those starting out).

The Quiet Engine Powering African FinTech

There’s a paradox at the heart of African FinTech: demand is booming (with some saying Africa is poised to be the fastest-growing Fintech market between 2023 and 2030)... but the infrastructure is patchy at best. 

Every payment, transfer or user verification is a mini war against fragmentation. It’s not that innovation is lacking; it’s that the foundation is a minefield – a major pain point for most founders we talk to in payments across Africa. True story.

Stitch saw that early and launched their counterplay in 2019.

Building the APIs that power everything from bank-to-bank transfers and card payments to user verification, top-ups, payouts and recurring billing, Stitch is on a mission to grow from a payment service provider to a comprehensive payments partner.

For developers, their solutions mean fewer headaches. For businesses, it means faster, cheaper, more secure ways to move money and onboard users.

As other local FinTechs, gig platforms, marketplaces, ecommerce solutions, neobanks and more scale, the need for one unified backend has never been greater. Stitch now powers everything from startup MVPs to enterprise-grade FinTech infrastructure.

Part of a wave of “infrastructure-first” startups, they’re building the rails that cross markets, sectors, and borders. And with FinTech players like Lula and Stitch empowering businesses, we’re watching this space…

Join us in Cape Town for a Fireside Chat with Lula & Stitch

DATE: Thursday, 22 May 2025
TIME: 6-9 PM
VENUE: Innovation City, Darter Road, Longkloof, Gardens, Cape Town, 8001.

We’ll unpack how to navigate funding, product-market fit and regulatory hurdles, what it takes to build trust and credibility with investors and clients alike, and the next big FinTech opportunities from their unique view of the market.

PLUS: We’ll have some bonus side-panels on fundraising, early-stage venture building and great networking opportunities with fellow builders shaping the future of tech in SA.

Early Bird tickets available till Friday + use OPENLETTER50 to get R50 off, an Open Letter exclusive.

CHECK THIS OUT

Is Your Business Name Available?

There’s magic in the perfect name.

We know many founders with successful businesses today who say it was all a pipedream, until the day their partner phoned and said, “We got it”. They’d registered the perfect name for the idea.

Names matter (a lot)

The right name can sharpen your brand, build trust, and create momentum:
📈 77% of consumers say brand name influences their buying decisions
🧠 72% of top-performing brand names are made-up or blended words
💡 Memorable names make hiring easier and reduce marketing spend

But finding a great name that’s actually available (legally and digitally) is harder than it looks.

Make it real

✅ Govchain lets you check legal name availability with their instant name search tool
✅ Spot names that work across domain, social and trademark checks
✅ Register when you’re ready — all online, no manual forms or queueing

If you’ve got a name in mind, it’s worth locking it down.

IN SHORT

A few quick ones in the tech space…

⚰️ Skype Shelved. After 23 years in the video-calling biz, Skype is getting shelved, with its last day yesterday. Microsoft has created a guide to help users migrate to MS Teams (its Slack rival), which is great if you hate yourself. Can't help but wonder if the move was to consolidate users into Teams.

🛒 Jozi you ok? Research by the PMBEJD shows that when it comes to groceries, Joburg is the most expensive out of the metros, with a monthly basket coming in at R5’559,46, which is R134,23 more expensive than Cape Town. So much for mountain tax…

🛰️ Hook it up. The Democratic Republic of Congo has just become the latest African country to get itself some of that sweet Starlink high-speed satellite internets. Despite having previously blocked the company from operating, the DRC announced that Starlink DRC will start providing services to its 115 million citizens in “the coming days”.

⏱️ Buffett Calls Time. Warren Buffett is stepping down from Berkshire Hathaway Inc. at the age of 94. Greg Abel, the vice chairman for non-insurance operations for the $1.16 trillion company, is set to take over the reins, with many shocked at Saturday’s announcement at the company’s annual shareholder meeting. What will you be doing at 94?

🗳️ Patrice 4 Prez? Some senior ANC members are already throwing their weight behind billionaire businessman Patrice Motsepe to step into the political arena and stand as SA’s next presidential candidate. But with the next ANC National Conference only in 2027, there’s still a lot of water to flow under the bridge. Interesting…

😎 The Stack. Founders need tools and suppliers they can trust. Check out our Founder’s Stack with all your business registration and compliance automated by Govchain, 90% off your first 6 months’ accounting with Xero, plus loads more vital startup tools & services.

BUILDER’S CORNER

BUILDING TOGETHER

Happening over at The Open Collab

In the last few days alone, in our online network, we…

• Enjoyed the short week and holidays a bit… 🏖️ (but glad to be back now).

• Secured event speakers who’ve raised almost R3bn between them.

• Plus: Got our free tickets for the big in-person event on 22 May.

• Looking to find Mordi contacts with a good BPO business.

• Helped Thijan with some options for a great UX designer.

• Got members first dibs on a 🔥 head of marketing role in SA.

• Helped Elijah get a lekker rental option in Stellenbosch 🏡.

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 network.

WHAT YOU SAID

Smarter power…

Last Friday, we riddled you about a South African startup providing solar power and smart energy management for township homes, and most recognised Zonke Energy…

🟩🟩🟩🟩🟩🟩 🔋 Zonke Energy (60%)

🟨⬜️⬜️⬜️⬜️⬜️ ☀️ SunScan (10%)

⬜️⬜️⬜️⬜️⬜️⬜️ ⚡ PowerPulse (5%)

🟨🟨⬜️⬜️⬜️⬜️ 🔧 IlangaLite (25%)

HOW DID WE DO?

BEFORE YOU GO