Nairobi — For African entrepreneurs to move to the next step and make the wealth volumes they aspire towards, they must shift their focus from necessity entrepreneurship to opportunistic entrepreneurship.
According to Malik Fal, the Managing Director for Africa of the Omidyar Network, exploiting opportunities in business rather than walking the common tried and trodden path, is a crucial key to making high impact entrepreneurship thrive in the continent.
In an interview with journalists, Fal said: "No longer is being an entrepreneur solely a decision of necessity, but one of aspiration."
Omidyar Network commissioned a study earlier this year, where becoming an entrepreneur was mentioned by 57% of the respondents as a desirable career choice.
Part of the results were released at an Entrepreneurship in Africa Summit in Accra, Ghana last month, presenting several challenges to successful entrepreneurship, whether real or perceived.
The findings of the study conducted by the Monitor Group listed limited access to financing, inadequate infrastructure, insufficient skills training, limited business support services and arduous administrative policies as obstacles to high impact entrepreneurship:
- 60% of respondents held that the cost of capital hinders company formation and growth.
- Only 23% believe they can afford the costs associated with using existing infrastructure.
- 80% believe primary and secondary schools do not devote enough time to teaching entrepreneurship, and 59% believe the same of colleges and universities.
- 55% feel that there aren't sufficient business support services available for new and growing firms
- 62% responded that they know entrepreneurs who have admitted to circumventing administrative burdens that discourage formalizing a business. These include: paying taxes, obtaining licenses and hiring employees informally.
The monitor group focused on six African countries, namely Kenya, Ethiopia, Ghana, Nigeria, South Africa and Tanzania.
They compared wealth creation in Africa and Europe, and found that it took a lot less people in Europe to create a lot more wealth than would be the case in Africa. The disparities sat with the types of businesses that entrepreneurs focused on and the needs the businesses met.
Omidyar, who were the main sponsors of the Africa Leadership Network annual conference last month, shared the survey with conference attendees to kick-start the necessary talk that could influence the future of entrepreneurship.
"Our success begins with understanding the needs of the entrepreneurs, the landscape in which they operate and the barriers that need to be removed to create vibrant businesses," said Fal, who was optimistic about the future of the African entrepreneurship landscape.
"We need to stop thinking that entrepreneurship is only the preserve of certain cultures, we need to open doors to female entrepreneurs, we need to stop copy-pasting ideas and build on what we have by filling in the gaps," he added.
He went on to say that one idea would be to re-import African talent to help tackle unique frontiers in entrepreneurship, all in the name of building the continent to be the force it can be.
"Despite facing significant challenges and obstacles, the African entrepreneur is resilient and optimistic," said Tebogo Skwambane, Managing Partner at the Monitor Group.
"To maximize the contribution that entrepreneurs can make to the continent, it is critical that policymakers craft policies that are suitable for their national or regional context."
Fal intimated that this is the first time this kind of study was being done in the continent and it was part of Omidyar's desire to document the journey of entrepreneurship and by so doing, celebrate its growth.
Established in 2004 by eBay founder Pierre Omidyar and his wife Pam, the Network is a philanthropic investment firm dedicated to harnessing the power of markets to create opportunity for people to improve their lives.
To date, they have committed more than $550 million for-profit companies and non-profit organizations.