Agriculture and tech most attractive start-up ventures

Ms Nyokabi Kaguthi, the owner of Africa Telerad, a start-up that specialises in interpreting X-ray images. PHOTO | JEFF ANGOTE 

In Summary

• The start-ups interviewed across Kenya, Nigeria, Uganda, Morocco, South Africa Malawi, and Ethiopia among other countries in the continent state that funding remains their main constraint in business.
• Also notable in the report is that majority of those surveyed are currently only doing business in their home markets, therefore missing out on regional and global opportunities.

By LILIAN OCHIENG'
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Agriculture, education and technology are the most attractive ventures for start-ups according to a new survey while tourism is the least.

'Anzisha Youth Entrepreneurship Survey 2016’ states that energy, construction and tourism are the least attractive choices for business at 4, 3 and 2 per cent respectively.

“Those who participated in the survey are confident about the future. More than three quarters are “very positive” (79 per cent), while 21 per cent are “somewhat positive” about the outlook for their ventures,” says the survey.

Despite, economic headwinds such as falling commodity prices, less accommodative global financial conditions and a strong US dollar, “the entrepreneurs who participated in the survey are overwhelmingly upbeat about the future of their companies.”

In agri-business, start-ups majority offer small loans in the sector while in education, they create online curricula that aim to transform learning. In technology, they create applications that solve local problems.

MAIN CONSTRAINT

The start-ups interviewed across Kenya, Nigeria, Uganda, Morocco, South Africa Malawi, and Ethiopia among other countries in the continent state that funding remains their main constraint in business.

“About 48 per cent of respondents highlight it as the biggest obstacle to expanding their companies,” Interestingly, only 3 per cent of respondents cited technological change affecting their industries as the largest challenge.

“This is surprising given how technological innovations – such as Airbnb and Uber – are disrupting traditional industries across the world,” states the survey.

The entrepreneurs also state that the burden of government taxation on their struggling businesses is a challenge to their growth. Kenya for instance subjects entrepreneurs to the same tax measures as big businesses, there are no special taxation measures which could encourage them to pay up.

The report highlights realities facing young entrepreneurs in Africa, it is based on emailed questionnaire answered by young entrepreneurs between the ages of 15 to 25 across the continent.

Also notable in the report is that majority of those surveyed are currently only doing business in their home markets, therefore missing out on regional and global opportunities.