South Africa’s startup scene is small enough that most of the investors who matter can be reached, eventually, through a mutual connection. Increasingly, founders are skipping the intermediary step and reaching them directly, through unsolicited posts on LinkedIn. The platform, designed for job-hunters and recruiters, has quietly become one of the more consequential pieces of fundraising infrastructure on the continent — not because it replaces due diligence, but because it replaces the cold email.
Consider Jem, a Johannesburg-based workforce-management and benefits platform that in August closed an $8.4m Series A led by Quona Capital, with participation from South Africa’s University Technology Fund, E4E, Next176 (the venture arm of Old Mutual, the country’s largest employee-benefits insurer) and an unnamed angel, Iain Williamson. The Next176 relationship, now central to Jem’s benefits strategy, did not begin in a pitch meeting. It began in 2022, when Jem’s founder, Simon Ellis, published a post on how to run better one-on-one meetings with staff. Tramayne Monaghan, then newly arrived at Next176 after leaving a venture role at a large telecoms group, messaged him for the template. A series of further posts and replies followed over roughly two years, interspersed with informal catch-ups, before the two men had a lunch in London that Mr Ellis says led, within a month, to a term sheet.
The mechanics of the deal itself were unremarkable: a term sheet, a lengthy restructuring of Jem’s corporate holding structure to accommodate international investors, and a closing that both sides say took longer than they had hoped. What was unusual was the courtship. Ellis did not approach Next176 cold. He had spent two years building a relationship with one of its senior dealmakers through a platform that neither side initially viewed as a fundraising channel. That history helps explain the wider investor network around Jem HR’s latest round, which included UTC. UTC was among the corporate institutions that provided the initial capital for the SA SME Fund. Because the SA SME Fund is the primary anchor investor in the UTF, it gives Old Mutual an indirect connection to the fund’s broader venture ecosystem, although Old Mutual does not hold a direct LP stake in the UTF. E4E Africa and Old Mutual have also crossed paths as co-investors in South African technology companies, including insurtech startup Pineapple. Before the Jem deal, Quona Capital and Old Mutual had similarly overlapped through investments in South African fintechs, including Yoco’s Series C in 2021, as well as through relationships with companies such as Lulalend.
Jem is not an isolated case. Thalia Pillay, chief executive of Orca, a fraud-prevention startup founded in January 2024 by two former engineers at Stitch, a payments firm, told Launch Base Africa that a single LinkedIn post about the company’s launch prompted several investors to make contact directly. Orca went on to raise $2.35m in seed funding, one of the largest such rounds ever secured by an all-female founding team on the continent. Ms Pillay’s account suggests the post did not close the round on its own — the company continued building relationships with funds over subsequent months — but it appears to have shortened the list of investors starting from zero.
Why the platform, and not the deal terms, gets attention
There are reasons to expect LinkedIn to matter more in a market like South Africa’s than in Silicon Valley. Venture capital there is thin: the pool of active local funds is small, foreign investors are wary of currency and exit risk, and the intermediary layer of scouts, angel syndicates and demo days that channels attention toward founders elsewhere in the world is underdeveloped. A public post that reaches the right handful of people can substitute for infrastructure that does not yet exist. It is also cheap. Unlike a roadshow or a conference appearance, a LinkedIn post costs nothing but time, and its reach compounds: investors who follow one South African fintech founder tend to follow several others, and algorithms surface founder content to people already primed to look for it.
This has a selection effect worth noting. The founders whose LinkedIn accounts convert into capital are disproportionately those with an existing credential — a stint at Stitch, a prior exit, a recognisable operator pedigree — that makes a stranger’s post worth reading in the first place. Ms Pillay and her co-founder Carla Wilby’s time at Stitch likely did more work than the post itself; Mr Ellis’s following was built over years of writing about management practice before Next176’s dealmaker ever replied. LinkedIn amplifies existing credibility efficiently; it does not manufacture credibility from nothing. For founders without a prior institutional affiliation, the same platform is far less likely to produce a term sheet, whatever the volume of posting.
The limits of the channel
None of this makes LinkedIn a fundraising strategy in itself. Posting without an underlying business, team or traction is unlikely to attract capital in a market where investors, however starved of deal flow, remain conservative; South Africa’s currency exposure and the continent’s history of high-profile startup failures mean scrutiny of unit economics has, if anything, intensified since 2022. What LinkedIn appears to do is compress the distance between a founder with a credible story and the small number of investors positioned to act on it — a function that, in markets with thicker capital markets and more venture intermediaries, is performed by other institutions. Its worth to South African founders, in other words, is not that of a marketing channel but of a substitute for infrastructure the local ecosystem still lacks. Whether that substitute scales as more capital enters the market, or whether it simply advantages the already-connected, is a question the continent’s investors have not yet had to answer at volume.