How do we promote bottom-up entrepreneurship in emerging economies? This is the central question that we will be discussing this week at the Legatum Convergence—an annual event held at MIT’s Legatum Centre for Development and Entrepreneurship.
Let us explore this question from a youth perspective: Young people represent the fastest growing demographic in Africa. Many are already economically active—some motivated by necessity to help their families. In Nairobi and Dakar, we are seeing young entrepreneurs demonstrate resourcefulness and inventiveness with a range of enterprises. With access to the right opportunities, skills, mentors, social networks, technology, and finance, they have enormous potential to be a driving force for economic growth and social progress.
Young entrepreneurs in Africa need the same basic tools as their counterparts in North America. But, access to financial services and markets, business connections, education and training, mentorship and support systems are often lacking. For example, financial institutions are averse to providing loans to youth-led businesses because these are seen as “risky”. And while the Silicon Valley ethos of “fail often and fail fast” is associated with learning and backed up with public and private support, this is not the case in many African countries.
As the discussion about entrepreneurship in Africa gains momentum, it is vital to ask how youth entrepreneurship can be developed as a potential pathway to spur job creation. For this to happen, we need to create a dynamic ecosystem of actors and resources that incubate businesses, facilitate access to capital and business development services, and provide assistance in the form of mentorship and peer-to-peer support. And we need to test models to understand what works and what doesn’t in various contexts.
Youth entrepreneurship is a powerful mechanism that taps into the creativity and drive of young people to bring about change, not just in their lives, but in their communities as well. It is an exciting area to explore as we stretch the boundaries of how young people in Africa can engage with their economies, on their own terms.