Despite the National Development Plan’s projection that 90% of jobs will be created through small and expanding businesses, South Africa has one of the lowest rates of entrepreneurship in the world. As much as the government is doing to create a culture of entrepreneurship, it requires time, skill, understanding and effort from various stakeholders to develop and maintain this culture. And it requires collective and collaborative activity.
The Aspen Network of Development Entrepreneurs (ANDE) is a global network of organisations that propel entrepreneurship in emerging markets.
Over the past five years, ANDE has helped identify inefficiencies in the marketplace— such as hurdles for start-ups, female entrepreneurs and market linkages. In a recently released report on the State of the Sector in 2013, three key recommendations were identified for improving the sector.
“Early stage ventures with women on their founding teams are less likely to attract investment, but more likely to be profitable than ventures without women”
A focus on the ecosystem
Beyond individual investment or support to businesses, there should be a more systemic approach. In order for small and growing businesses (SGBs) to thrive, they need to rely on leveraging partners, such as banks, local educational institutions, entrepreneurial support organisations and government. As entrepreneurs themselves become successful and become investors, they will help to create thriving marketplaces and an overall improved local economy.
Cultivate middle management talent
Hiring and retaining top talent is a challenge for any business, but especially in emerging markets where businesses often cannot afford the talent they need to grow. The sector should invest in education and training initiatives to develop middle managers who will create a steady workforce, and as a result create strong, sustainable businesses.
Embrace a Gender Lens
Female entrepreneurs face cultural and structural barriers. Early stage ventures with women on their founding teams are less likely to attract investment but more likely to be profitable than ventures without women founders. Having a gender lens—considering how female entrepreneurs are supported by and participate in companies—will create social impact and increase investors’ bottom line.
About the author: Bridget Fury is the new Director of the Aspen Network of Development Entrepreneurship (ANDE) South African chapter. She has worked for many years as an independent consultant in the social investment space and is passionate about the role of entrepreneurship in development.