Tech hubs are emerging all over the African continent, with new innovative startups being developed. Global companies are directing their attention to the increased potential of the African tech sector. GSMA Ecosystem Accelerator’s report showed that the number of tech hubs operating in Africa increased from 314 in 2016 to 442 last year, and the figures are still on the rise.
South Africa is the country that hosts the highest number of tech companies on the continent, fostering and promoting innovation. Johannesburg and Cape Town are competing for the number one position in the country as the most thriving tech hubs, and while Cape Town used to benefit from dominance, it seems like things are starting to change.
Is “Silicon Cape” taken over by Johannesburg?
Cape Town has been long considered the ‘beating heart’ of the tech sector in South Africa. The most successful and powerful companies with this profile have their headquarters there, this being the reason why Cape Town has earned the nickname of Silicon Cape.
Recent researches suggest that the position of Cape Town has been slightly altered with more software developers and tech specialists looking into the opportunities available in Johannesburg. New data shows that higher salaries are available in Johannesburg for those working in tech, this being the most powerful factor that has triggered the ‘battle’ between Cape Town and Johannesburg as most thriving tech hubs.
Being the largest city in South Africa, and already having earned the title of the country’s legislative center (considering it’s where the Constitutional Court is located), Johannesburg has started to become a popular option for tech entrepreneurs and experts.
While Cape Town offers a younger and more vibrant tech scene, Joburg is where the higher salaries are, so naturally some software developers as well as other workers from this field are lured towards the hub with higher earning potential.
What triggers the salary difference between these two South Africa cities?
What are the main reasons that set apart these two important cities in South Africa in the tech department? Why is Johannesburg offering higher salaries to programmers, developers, and other tech specialists? Experts from the field claim that the aspect standing at the base of the differential is that the largest banks and corporates have their headquarters in Johannesburg. Regular tech startups based in Cape Town naturally can’t afford competing with the financial reach of larger corporates, at least not for senior positions.
In Cape Town, those working in the field of tech are more likely to take up a job just because it’s being offered by an exciting startup with innovative and appealing potential, instead of being lured by a high-paying position. While there certainly are more software development companies in Cape Town, Johannesburg remains the place where the money is.
Despite these differences, is Cape Town’s reputation in the industry actually under threat?
Will Cape Town preserve its tech hub reputation?
With so many speculations being made in the tech field this past year, some people might be wondering whether ‘Silicon Cape’ will lose its tech glory. Well, all tech hubs in Africa, and more particularly in South Africa, are still expanding and thriving, and while Johannesburg might currently offer higher-paid jobs, Cape Town still preserves its wide list of benefits.
A 2017 report from Savills Tech Cities shows that Cape Town ranks quite high on a global scale in terms of quality of life, just bellow startup hubs in San Francisco and New York. Cape Town was actually the only city in Africa mentioned in this report, which clearly demonstrates that it will take more than higher salaries for Johannesburg to overcome Cape Town’s popularity, both locally and internationally. The city is actually the place where 59% percent of South Africa’s startups came to life, benefiting from a strong and solid tech scene. Venture capitalists and tech incubators are also present, and add to the overall power of the tech hub there.
Remote working – a popular trend for tech hubs in South Africa
Whether we’re talking about Cape Town, Johannesburg or any other major tech hub in the country, one of the current trends that are circulating is remote working. Tech entrepreneurs, software developers and programmers are looking into the existing opportunities of working from home. For tech employees that want to combine the higher salary provided by a company from a specific center with the affordable living costs of another city, remote work has become the ideal solution.
Tech hubs in the country benefit from different appealing characteristics. While some come with highs-standard living conditions, others provide the buzz and tech vibrancy some developers are looking for. With remote working, however, the ideal mix can be obtained by those entering the South African tech scene.
South Africa’s tech future – appealing presumptions
What does the future promise for South Africa and its tech industry? The government is said to work towards creating yet another major tech hub in the country. SEDA (the Small Enterprise Development Agency) in collaboration with the Department of Telecommunication and Postal Services are presumably working together to put the base of the largest tech hub in all Africa. A coding and programming academy that also hosts co-creation and co-working spaces for the younger startup generation could come to life somewhere in the future. The Government wishes to take the country’s innovation and sector creativity to new heights. So, once can clearly state that the future is bright for South Africa’s tech, considering these appealing presumptions.
Overall, South Africa’s tech hubs continue to impress with their performance on a global scale. Startup development is not slowing down anytime soon, and the country has truly embraced innovation, fostering an optimal environment for thriving tech actions. Cape Town and Johannesburg stand strong and will probably remain the most targeted cities by tech enthusiasts, but opportunities exist all over the country, as more hubs are being opened and new job positions appear across the country. As for the future goes, only positive things are being expected.
