The deal, announced back in April by Trade and Industry Deputy Minister Maria Ntuli and Microsoft South Africa Managing Director Mteto Nyati, is part of the company’s broad-based black economic empowerment (BBBEE) programme.
It will see Microsoft spending R472 million on helping small, black-owned software development companies grow into global companies by 2017.
Now, after a vigorous applications process and due diligence, the companies that will be the beneficiaries of this deal have been selected from responses to a nationwide request for proposal and will be announced at the end of this month.
It is expected that between five and ten companies will be part of the initial programme.
Speaking at the launch event in Sandton, the DTI’s Ntuli said the deal was noteworthy for addressing indirect elements of BBBEE such as skills and enterprise development.
“The country can only be transformed if empowerment plays its rightful role in business,” she said.
“We need to ensure it is linked more effectively to the development of skills, and to growth of local businesses. The Microsoft programme covers both aspects well.”
Microsoft’s Nyati said the investment would directly address some of the key challenges facing the government and South Africa as a whole – namely creating jobs, developing enterprises, building the local software economy and developing scarce technology skills.
It is anticipated that the deal will take Microsoft from a Level 4 to a Level 2 BEE contributor.
“This is not just another BBBEE deal that features familiar faces and just ticks the boxes,” he said.
“We’re looking to take existing software development companies and transform them into companies that compete in South Africa and around the world in areas like cloud computing. We want to create a new model for entrepreneurship and set a new benchmark for developing talent in the local software industry. We want BBBEE to be associated with real development, job creation, business development and skills enhancement.”
Edited by Ellie Duncan