Across the continent of Africa, there is a proliferation of new ventures. Unfortunately, this hasn’t translated into economic impact primarily because most of these new enterprises are micro-businesses that have come about due to necessity and hence do not achieve the critical size required to make significant contributions to GDP or employment.
The Global Entrepreneurship Monitor’s annual report looking at the state of entrepreneurship globally found that Africa is the continent with by far the highest number of people involved in total early-stage entrepreneurial activity (TEA), with Zambia and Nigeria leading the world rankings. It is quite telling that despite this relatively huge entrepreneurial activity, the contribution of entrepreneurship to economic growth and development is lower in Africa than most other places in the world. While supporting this tradition of entrepreneurship in Africa, we at TechPreneur Africa are more interested in addressing the key issue of scale.
In Africa, we say it takes a whole village to raise a child.
By extension, it takes a whole community to build a business. Via our ecosystem development programs, we engage all major stakeholder groups (government, risk capital, academia, entrepreneurs, and corporates) within target regions and apply our expertise and frameworks, develop a customized economic acceleration strategy and start the implementation process.
Our approach therefore is not to focus on creating more startups (i.e. enterprise that serves local markets with traditional, well-understood business ideas and limited competitive advantage thereby remain small) but to create Innovation Driven Enterprises that are enterprises which pursue global opportunities based on introducing consumers to new innovations that have a clear competitive advantage and high growth potential.
IDE entrepreneurship can be slower, more complicated and it also requires a range of stakeholders but they are much more profitable in the long run, create many more new jobs and more exports (thereby impacting GDP).
For governments looking to create jobs by promoting entrepreneurship, clarity on the different types of entrepreneurship is necessary but often lacking. The distinction between these 2 types of enterprises is also important for entrepreneurs, policy makers, incubators and accelerators.
TechPreneur Africa works with different stakeholder groups to coordinate their activities and therefore provide a systemic approach to driving real economic impact via entrepreneurship.