Building a working entrepreneurial ecosystem for smme’s to thrive

Rapelang Motsumi

My journey of entrepreneurship started as early as in primary school where I used to sell sweets, snacks, marbles to my fellow pupils. When I proceeded to high school I then used to sell floppy discs and also used to be a photographer. Growing up in a spaza shop family also meant that my entrepreneurial flare was nurtured very early. That early exposure led my academic journey to choosing commerce stream. Starting a business right after tertiary without strong corporate experience meant that I needed a strategy to bridge that gap. At the inception of my formal entrepreneurial career I joined Shanduka Black Umbrella (Incubator) and the Branson Centre of Entrepreneurship to accelerate my growth and experience.

I always advise that joining any support institution for development is what you individually make it to be. 

The entrepreneurial ecosystem simply means the co-ordination of role players who are enabling a thriving environment for small businesses, these may be  incubators, accelerators, corporate programmes, funding institutions, government SMME agencies etc

Support for small businesses in South Africa is widely available for small businesses than any other African countries and many other developed nations around the world. This is supposedly enabled by the Broad-Based Black Economic Empowerment (BBBEE) policy that seeks to racially transform the mainstream economy and ensure inclusivity.

According to the ‘Total Entrepreneurship Activity’ (TEA) the South African ratio is 1:18 meaning that only 1 in 18 people who are adults are entrepreneurs. This reflects very low levels of entrepreneurship as compared to other developing and third world countries. This however seems like a paradox given high levels of support institutions in our ecosystem for small businesses.

Cracks in the system

  • Some entrepreneurs believe they are not getting maximum value out of support programmes
  • Other commentators believe overtraining of entrepreneurs does not move the needle in terms of real impact.
  • There is lack of coordination and collaboration amongst support institutions. They are fragmented and working in silos.
  • The system has been exploited by vultures, sharks and unscrupulous ESD providers who want to make money at the expense of hardworking ambitious entrepreneurs.
  • Critics believe that the system needs a complete overhaul.
  • ANDE Report has found that there is an early stage funding gap and lack of measuring real impact of support institutions.
  • SEED Academy survey also reveals that out of R26 Billion from Enterprise and Supplier Development spend, most of it goes to administration of programmes and training intervention. Very less budget is dedicated to the much needed resources entrepreneurs need to go to the next level.

Entrepreneurial Ecosystem doesn’t mean we have to be another Silicon Valley, which has been evolving for over 50 years in a first world country and the richest economy in the world. We can how ever learn few things from their model to improve what we have. Among other important facts we learn of incubators such as Y COMBINATORS who produced Billion Dollar companies like Air B&B and Dropbox. This by far demonstrate that incubators and accelerators with the right models led by visionaries can produce many high impact entrepreneurs and globally scalable start-ups.

My experience with being part of an incubator was empowering given that it came at a time that was much needed. Our experiences will always differ but once you define your needs and find a support programme that matches your needs you will not regret. The ANDE Survey has listed over 340 role players that you can choose from in South Africa. Alternatively you can download the survey from this link

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