Case Study Uganda

Uganda has repeatedly been named one of the world's most entrepreneurial countries. However, while entrepreneurial activity is on the rise, only six percent of businesses expect to create six or more jobs in the next five years. This means that most of the businesses will either not survive or remain small-scale, thus have little or no impact on local job creation.

Swisscontact, together with Credit Suisse and Amarin Financial Group, has piloted Social Network in Uganda, both in the buzzing city of Kampala and semi-rural Jinja to better understand the local dynamics and how well entrepreneurs are being supported on their growth journey.

Key Insights from the report:

  • Half of the entrepreneurs interviewed are not being served by the ecosystem, hence being left alone with their entrepreneurial venture

  • Peer-to-peer learning is happening, albeit at a low level and there is large potential in connecting entrepreneurs across different growth stages

  • Access to early-stage finance beyond personal or family investments is limited to impeding entrepreneurs to grow their businesses

  • Kampala accounts for many ecosystem support organizations (ESO) but there is little interaction between them which means that in practice most of the actors still operate in isolation

 

Strong ecosystems allow entrepreneurs to quickly find the required knowledge and resources. The SNA in Uganda has shown that entrepreneurs tend to receive little support on their growth path. A major reason is that ecosystem support organizations do not sufficiently provide the linkages needed to help entrepreneurs get faster and easier access to support services or funding.

The lack of collaboration further means that there is little to no specialization within the ecosystem. Most of the actors offer the full range of services: training, coaching, mentoring, technical assistance, linkage to peers, linkage to markets, financial literacy and community building and often across the different industries. Instead of looking for specialization and building up networks with suitable partner organizations that support entrepreneurs on their growth path, ecosystem players in Kampala work with the few resources they already have and provide every kind of service themselves. This not only leads to resources being under-utilized but also impacts the quality of services provided to entrepreneurs, given that a single actor can hardly specialize in the many services an entrepreneur needs across the various growth stages.

Ecosystems grow and become stronger through the continual interaction of all stakeholders who are working toward a common goal – supporting entrepreneurs.

Entrepreneurial ecosystems are about creating win-win situations based on the principle of ‘give and take’. Successful collaboration can therefore only happen if each ecosystem actor is clear about what it BRINGS TO the ecosystem and what it TAKES FROM the ecosystem. Hence, each actor needs to think not only about his own goals but also about the goals of the ecosystem and how he can help it to advance.