In a nation beset by unemployment, it is vital to provide new work opportunities. Our collective future will remain unknown unless we work together to address the problem. And the significance of entrepreneurship to South Africa's economic success cannot be overstated.
In this article we speak to industry experts to find out how businesses can empower entrepreneurs.
Enable interoperability for consumers and businesses
Dare Okoudjou, founder and CEO of MFS Africa, believes that when it comes to Africa and financial empowerment, we must recognise that customers have the same wants and demands as consumers everywhere else in the globe. Therefore, African consumers and businesses should be able to make payments to any location, online or offline.
"For us at MFS Africa, that means connecting mobile money to the rest of the world. Card networks very much appear to be the best way of doing so. It's something that we've been working on for some time too. In 2019, for example, we concluded an agreement with Visa to connect our MFS Africa HUB to the Visa Network to enable card issuing at scale. It was a slow burn, but with the recent acquisition of GPT, we're in a prime position to accelerate interoperability," says Okoudjou.
Empowering SMEs through the provision of finance for business growth
SMEs are a crucial source of development and of employment in Africa, yet they struggle to access finance for growth, especially from traditional funders, such as banks. And so, other types of funders have entered the market. Private equity - in which the funder provides the money needed for growth and participates in the management of the business - is one such source. "This type of funding has become increasingly popular in the region," says Bryan Turner, Partner at Spear Capital, a private equity firm that invests in businesses in the SADC region using funds from investors in Europe. Turner goes on to highlight this, quoting the figures for private equity investments in Africa during 2021, which achieved an all-time high of USD7.4 billion, double the previous year's figure.
Similarly, firms providing private credit are also being kept busy in the region. Norsad Capital, for example, has provided finance to about 150 companies in Africa, bringing in more than USD500 million in funds to businesses in Africa. As an impact investor, Norsad focuses on bringing societal benefits through the businesses it funds, thus empowering these local enterprises to become job creators and leaders in environmental sustainability in the region.
Provide the right platform at the right price
SMEs are powerful drivers of economic growth but they can also be very beneficial to the communities in which they operate. Not only do they create employment opportunities - in South Africa SMEs make up 98% of formal businesses and employ between 50 and 60% of the country's workforce - they also help develop communities, says Andrew Bourne, Regional Manager, Zoho Corp.
Zoho has seen how having the right platform, at the right price, can empower small businesses to operate on a par with larger companies that have access to wider resources. Low and no-code tools, as an example, make it easier for small businesses and entrepreneurs to build their own customer-facing applications. These platforms can easily be adapted as the business grows. "Community-based organisations that have access to the right technology will be more efficient, more organised and more effective," says Bourne. "The long-term impact on the people living within these communities will be significant."
Find a pain point - and solve it
Aisha Pandor, co-founder and CEO of SweepSouth, South Africa's largest on-demand home cleaning service, believes that if you want to truly make a difference with your business, you need to find a pain point for your potential customer and solve it. "When you've done that, find the next one. You'll soon make an impact," she says.
At SweepSouth impact means empowerment, which in turn means ensuring domestic workers earn higher than market rates and giving people the power to choose who they take work from, where, and at times that suit them via the platform. "As such, empowerment is also about connectivity, and technology is one of the most important enablers of connectivity. Through our platform we wanted to leverage that potential to ensure that domestic workers are able to connect with as many employment opportunities in the most convenient way possible," Pandor says.
Funding Black founders in Africa fuels generational and systemic change. The Google for Startups Black Founders Fund for Africa program reinforces Google's commitment to empowering entrepreneurs and startups in the region as a vital prerequisite to driving employment and growth on the continent. The fund has just announced the second cohort made up of 60 of the most promising black-founded startups across Africa who will receive their share of $4 million in funding, as well as access to a network of mentors to assist in tackling challenges that are unique to them.
"Africa is a diverse continent with massive opportunity but the continent is faced with the challenge of limited diversity in venture capital funding flow," says Folarin Aiyegbusi, Head of Startup Ecosystem for Google in Sub Saharan Africa