Business
Africa entrepreneurs: jacks-of-all-trades
Ory Okolloh, activist, lawyer, blogger, and co-founder of Ushahidi.com. PHOTO/File
One of the many terms Silicon Valley has bequeathed to the business world is “serial entrepreneur”, a label for those restless souls who start one business after another. Perhaps Africa can now contribute another expression: the “parallel entrepreneur”.
(More: Profile: Serial Entrepreneur, Njeri Rionge)
More than in any other part of the developing world, entrepreneurs from Africa create networks of several firms across a number of different sectors of the economy, according to research by IMANI, a think-tank based in Ghana. The 189 successful entrepreneurs it surveyed in Ghana, Nigeria and Kenya own, on average, six businesses each. One boasted more than 60. What explains this entrepreneurial hyperactivity?
Certain characteristics of the economies of countries in Africa also make it more profitable to keep starting new firms rather than build a single big one. Key resources are scarce. Mid-level managers are in sufficient supply, but few are capable of running large businesses, which is why they often apply their talents in several firms simultaneously. Financing is hard to come by (in many countries loans are granted for as little as 20 months); entrepreneurs find it easier to get several small loans for each business rather than a large chunk of money.
