Four reasons why most African entrepreneurs do not pass the incubation stage, A Zimbabwean tale

So, I have been an entrepreneur for the past 8 years in one of the toughest environments to operate for entrepreneurs by any measure, Zimbabwe. For colleagues who are not very familiar with this place, Zimbabwe is small African land- locked country south of the Sahara measuring about 390 797 Square kilometres with a population of about 14 million people. Quite endowed with natural resources and a great climate.
Just to quantify why Zimbabwe is a difficult space for entrepreneurs, let me share some interesting statistics. Zimbabwe stands at 182 in the ranking of 189 economies on the ease of starting a business The corruption index in 2015 puts Zimbabwe at number 150 out of 167 countries Unemployment rate is estimated between 80 and 85 %. The informal sector is believed to be one the biggest market and circulating about USD 3 billion dollars, most of the activities are undocumented. Gross Domestic Product of about USD 14 Billion and national debt of is USD 10 Billion.

Though I’m tempted to talk about why each of the factors (above) are in that state, I will focus this discussion on why its difficult for young entrepreneurs to grow beyond idea stage and why the entrepreneurship ecosystem is failing to address the challenges. My experience working in this space has shown that entrepreneurs in Africa and Zimbabwe follow are very different pathway compared to colleagues in developed nations.

#1 Role models are not real
I have noticed, a new breed of entrepreneurs who strongly believe they cannot succeed with their unique ideas unless they are associated with government official or politician. Many brilliant minds spend too much time building the wrong networks. Association with senior government official or politician is highly regarded. Yes, I am sure this happens across the world, but in a country that heavily polarised, these role models are corrupt and dirty and often divert attention from the real effort. It is quite celebrated to have such an association even if you don't agree with the principles and values. In fact some entrepreneurs charge their colleagues to use their political networks and gain sympathy. It is generally believed that politicians and senior government officials can unlock opportunities related to finance, land and tenders. A few entrepreneurs who have optimised on this notion are considered very successful and are celebrated. However, most end up with no real product or service but just a mouthpiece for a political party and end joining the corrupt bandwagon.

#2 focusing on the wrong skill set
While modern entrepreneur ecosystems in other countries are dominated by youths, in Africa it is vis versa. The celebrated entrepreneurs in Africa are old or elderly. In fact the noticeable successful individuals are mostly politicians, they are rich, powerful, have everything they need and more. It is an African ideology to emulate our elders. Elders are considered to have all the knowledge and younger generations have little significant contributions and should wait for their turn in life. No wonder why we have so many old leaders who still believe are energetic and in touch with the global trends. Because our young people are accustomed to this believe, they focus on the wrong skills, which in most cases doesn't aid their innovations. Let me clarify this with an example. A person is considered most successful if they have multiple degrees or highly educated in a wide range of areas. It is quite celebrated to have 5 or 6 degrees in different subjects (economics, literature, sociology, business and wildlife) just an example. I find entrepreneurs taking 4 or 5 courses all at once just so to get the respect, even if the education is not related to their businesses. I think it's a waste of time, I would rather develop my team with a varied skill set, than do it all alone.

#3 Misdirected financing and capital
Its extremely difficulty to raise funds through formal channels such as banks, investment funds in Africa. A lot of entrepreneurs spend resources getting “politicians ready” as opposed to “investor ready”. Instead of spending effort understanding the product, market, key matrices that measure success and setting organisational systems, entrepreneurs spend too much time and effort chasing free money and land from politicians. In Zimbabwe entrepreneurs would spend money to get access to a political system that can easily reward them with cheap or free grants, free land, access to tenders. The sad reality is that once you receive the patronized freebies, you are stuck with a rotten system of patronage. An attempt to move out of the system means that the ill gotten resources cannot be guaranteed. The challenge is that when entrepreneurs are then exposed to the real world of capital competition they cannot stand the heat. Most find the investors demands ridiculous and would rather remain with the status quo.

#4 Mentality of suspicion, mistrust and stolen heritage
I find this one very interesting, I have ran a number of pitch competitions for young entrepreneurs in Zimbabwe. The one reason why potential entrepreneurs don't participate is fear of loosing their ideas to plagiarists. Well, I guess it could be true. But why do entrepreneurs behave or believe this way?. I think I know the reason why. I have noticed that in Africa, our leaders have peddled a gospel of mistrust and stolen heritage. The leaders that are considered Pan Africanists don't end a speech without reminding followers that developed nations have a clandestine mission to steal our resources. What’s surprising though is most of them have investments in the countries they despise. Some of these leaders loot resources from their people and create earthly paradise in foreign lands of their detractors. The sad thing is that the young people believe this myth and most are stuck with ideas in their heads for fear of loosing them to "wolves in sheepskin". Again comparing with advanced ecosystems, it is very common to go on Angel list website and browse thousands of ideas from entrepreneurs. My favorite site is https://bnktothefuture.com