Business
Tracking The Impact of Technology On Entrepreneurship In Uganda
In the last decade, the use of technology has contributed enormously to growth story of sub-Saharan Africa’s economies. Technology has opened Africa to new vistas and presented its youths with an opportunity to tackle the scourge of unemployment themselves – some have even turned that opportunity to million dollar companies.
In Uganda, technology is gradually contributing to the country’s economic trajectory. Over the past few years, the country’s technology sector has witnessed rapid growth, especially in the areas of mobile devices, computer applications, information processing and sharing.
According to statistics from Uganda Investment Authority, posts and telecommunications services activities grew by 30.3 percent in fiscal year 2010/11 and accounted for 3.3 percent of Uganda’s GDP. These growth changes have had a profound impact on Ugandan economy, making the Information Communication sector an important driver of economic growth.
The 2012 UN unemployment report indicates that the global youth unemployment rate stood at 12.6 percent, dramatically overshadowing that of adults, which stood at 4.8 percent. This rise is attributed to poor education systems that are not centered on practical skills especially in developing countries like Uganda. This has prompted the youth to come up with more innovative ways to create employment opportunities.
As of the end of 2011, Uganda Communications Commission (UCC) and the International Telecommunication Union (ITU) reported 4.6 million internet users in Uganda, amounting to 13 percent of the country’s estimated population of 34.5 million. There are currently more than 48 licensed telecommunications service providers, a good number of which offer both voice and data services, and over 30 internet service providers (ISPs) that offer broadband and dial-up internet services.
Given this trend of ICT growth in Uganda, there has been a sharp increase in the number of entrepreneurs in the ICT industry who have not only enjoyed the reduced costs of production, but also targeted Public and Private sector support.
In 2012, three students of Makerere University designed “WinSenga “, a smartphone app that performs ultrasounds on pregnant women and can detect problems like ectopic pregnancies and abnormal heartbeats. They went on to become the first winners of the East and Southern Africa of the Imagine Cup, the world’s premier student technology competition hosted by Microsoft Inc.
However, two years later, this innovation has not realized full commercialization despite having been a unique and potentially lucrative innovation. This brings into consideration the fact that there are very many unique entrepreneurial ideas in Uganda only lacking but a feasible commercialization strategy, the WinSenga applications is just one among the many examples of innovative ideas that have still struggled to meet their objectives past the initialization stage.
However the story has not been the same for all the entrepreneurs as many of their startups do not live to celebrate their first anniversaries. This has been attributed to lack of internal innovation, while this may not necessarily mean coming up with something new, it has become a characteristic of many of the entrepreneurs to replicate some of the ideas already existing with only a change in the name and process.
This has ultimately created numerous web-based startups that basically deal with news, IT support services, Internet Cafe’s and web designing. Walking along a busy street of Kampala, Uganda’s capital city, one cannot help but notice the door-to-door duplication of services by ICT entrepreneurs.
Generally, as much as there are challenges in the industry, one of the key achievements has been the initiation of ICT Innovation hubs. An ICT hub is a co-working space where tech-orientated individuals congregate to network, share ideas, work, programme and design. These have played a big role in incubating many of the entrepreneurial ideas in the country.
According to Hilda Moraa, a senior researcher at iHub in Kenya who was one of the speakers at the AfricaCom conference in South Africa last year, the hubs are growing at a tremendous rate. “Currently we have more than 90 hubs in Africa and the number just keeps on growing. It’s from these hubs that entrepreneurs have managed to launch successful startups and with the support of mentors.
As part of their services, Mara Launch Pad, one of the ICT innovation hubs in Uganda offers Launchpad members desk space, wireless internet access, a staffed reception area to receive their guests and a meeting room all at a nominal fee. ICT hubs provide a cost effective way for startups to grow their businesses, maintain a professional image and manage their expenses all while being strategically located within the city (where production costs are relatively cheaper), and embedded in an entrepreneurial environment that fosters learning and collaboration.
One of the most prestigious universities in Uganda, Makerere University has also been fundamental in encouraging ICT innovation in the country by collaborating with a number of tech giants such as Google and Microsoft. Based on the same model as that of innovation hubs, innovation centers have been created within the university to provide support, guidance and mentorship to students interested in ICT entrepreneurship, and the advantage of this is that there are many opportunities for student collaborations and partnerships with the support of already established companies in the industry.
Competition fuels Innovation. Through a number of innovation challenges, a new breed of entrepreneurs has evolved and this has mainly been centered on finding solutions to real world problems both in Uganda and Africa. The government through its ICT regulatory body and the ICT ministry has been instrumental in organizing such competitions among which is the ACIA (ICT for National Development Awards) UCC awards whose aim to identify and reward Innovative ideas in the ICT industry.
Other private companies have also come in, and partnered with the government to organize innovation challenges however we cannot say enough has been done. There is still need to identify and nurture innovation from the grass root levels, considering that most of the challenges have mainly targeted ideas from entrepreneurs in the urban centers.
According to a 2008 survey by online research program Audience Scapes, only 3 percent of Uganda’s rural population has access to the internet compared to 16 percent in urban areas, indicating the work that needs to be done in terms of ICT investment by the government through Public-Private partnerships. This will not only create a wider market for the ICT entrepreneurs but also create an opportunity for Uganda’s outside the urban centers to also leverage on the opportunities ICT presents. There is still a long way to go, but the progress made so far is encouraging.
Copyright Ventures Africa 2014