Supporting opportunity-driven TECH Entrepreneurship in Ghana

Supporting opportunity-driven TECH Entrepreneurship in Ghana

The Ghana Tech Lab, in collaboration with the Briter Bridges, compiled data about the Ghanaian tech ecosystem outlook for the year 2019. From the ecosystem outlook, one can observe the creation of several tech-based companies in Ghana over the past years. The development indicates the level of activity taking place in the tech ecosystem.

Source: www.briterbridges.com

The future of the ecosystem looks outstanding with this level of vibrancy. Looking at the level of energy of the young entrepreneur, how prepared are we as a country for the future? The survival of these companies will be based on the measures that we put in place to support their growth.

Many developed nations prioritise tech-based entrepreneurship and are heavily investing in this sector. There is a steady growth in the number of startups established in a year in these developed countries because of the available support. The creation of jobs is a byproduct of this growth. The yearly turnover of some of the tech companies in some developed countries is twice the size of Ghana’s gross domestic product – this shows how we stand to benefit as a nation if we strategically invest in this sector.

It is an acknowledged fact that small businesses are the backbone of stronger economies. However, it is not just any small business but opportunity-driven businesses. In Ghana, majority of our businesses across all sectors are small businesses, but the output is quite small. Most of them are necessity-driven businesses and not opportunity-driven. Many people are in business for survival and not necessarily to grow an enterprise. The tech sector is not immune to this problem.

Opportunity and necessity-driven entrepreneurs

The Global Entrepreneurship Monitor (GEM) defines opportunity-driven entrepreneurs as individuals who initiate a business because they have identified an opportunity they want to exploit in the market, while necessity driven entrepreneurs are people who start businesses because they do not have any other option; these are mostly unemployed, and see engaging in business as a way to earn a living. According to the GEM, “Opportunity driven entrepreneurs mostly engage in businesses which is growth-oriented and leads to employing other and growing bigger, but that is not the case of necessity driven entrepreneurs”.

Tech Entrepreneurship support

Governments over the last years have shown tremendous interest in the entrepreneurial ecosystem. Due to the new developments taking place in the tech ecosystem, it has become one of the most attractive sectors for the youth who want to start businesses. The government will have to collaborate with the private sector to develop a policy guideline for this sector. There should be a strategy to identify and adequately support the opportunity-driven entrepreneurs to scale faster. This approach could create many jobs for youth with exceptional talent in the tech ecosystem.

The Guardian news website published an article entitled “US cities and states give big tech $9.3bn in subsidies in five years” last year. This article spells out the amount of money that some American state governments pumped into some selected private companies (opportunity-driven) to support their growth – Apple, Amazon, Facebook, Google and many other companies have benefitted and continue to benefit from this support. The benefits are in the form of direct and indirect subsidies, which make them competitive.

Elon Musk of Tesla, for example, has been able to achieve most of his “crazy” dreams riding on the back of these support avenues available to technology-based companies in America. His company secured a loan of 465 million dollars from the American government to support its growth and expansion.

European countries are doing the same for their opportunity-driven tech entrepreneurs as well. The success of these companies is built on millions of dollars worth of subsidies and loans they have received from their governments.

M-Pesa in Kenya has transformed the economy, and it has provided jobs for many people directly and indirectly. The Kenyan government’s role has been instrumental in the success of the mobile money platform.  

Governments favour tech companies because of the value they bring to the economy in the long term.

Supporting Ghanaian tech entrepreneurs

The tech companies in the Ghanaian ecosystem can equally build significant innovations and create more jobs for the youth when given the needed support. We need to define and state our expectations from the tech sector as a country.  We can set our priorities right when we have clearly defined our expectations – from the regional to the national level.  If we want to benefit from the tech sector as a country, then we should dedicate some funds to support identified opportunity-driven entrepreneurs.

The government will also have to commit to buying the products of our local tech companies rather than foreign ones. That is what is done by most developed countries. These kinds of support will challenge our entrepreneurs in the tech ecosystem to come up with more innovative ideas.

The digitalisation of the other sectors of the Ghanaian economy is imminent, and the country must prepare for it. We can only do this locally if we properly resource our tech entrepreneurs to make them ready for this challenge.

Author: Kwabena Obiri Yeboah,

Member: Institute of ICT Professionals, Ghana

For comments, contact author: koyeboah2@gmail.com, kwabena.yeboah@afrolynk.com