UK, Saudia eye Africa for startups
Kenya must enhance support for startups to avoid talent drain to Europe and Middle East who are dangling startup visas to lure entreprenuers abroad with the promise of support and funding.
The United Kingdom and Saudi Arabia are some of the countries currently attracting founders to apply for startup visas in order to establish global headquarters abroad and hence attract more funds.
Saudi Arabia looks into diversifying it’s economy which mostly banks on oil while UK intends to spur a thriving business community in an otherwise shrinking economy due to Brexit.
“If you are an entrepreneur or founder of an innovative technology business based overseas you may be eligible for UK government support to help you move your business to the UK,” the UK representative Shelly Walters said.
Support is free and includes, mentoring from experienced entrepreneurs, help to develop business plans, assistance with relocating to the UK providing introductions to key networks including investors guidance on how to grow internationally.
“Participants are mentored by experienced entrepreneurs known as ‘dealmakers’, who are experienced in setting up, building, scaling and selling technology companies,” the UK officials said during an event at iHub in Nairobi where founders from Kenya and other Africa countries attended.
The UK which had only been employing nurses from Kenya in the last few years has started accepting low skilled workers due a reduction of workers many of whom came from the rest of Europe before Brexit.
The move to tap founders perhaps is the highest attempt to scout some of the best talent in Kenya. Britons may not see this as a threat given that entrepreneurship is perhaps the most difficult career ever.
Last month the UK organized a meetup with Kenyan founders in a bid to get the best pitches that will then qualify for a UK startup.
Entrepreneurs see this as a boost to their success rate as African startups have high failure due to lack of infrastructure.
In Kenya, the startup failure rate is estimated at 90 per cent which means nearly all new business shut down within two to three years, due to lack of funding and mentorship.
Saudi has also called on startups to apply for the start-up passport as it seeks to battle established ecosystems in Israel, Egypt, Jordana and others with over $6.4 billion (Sh726.72 billion) in investor funding.
Garage for startups
To tap more start-ups, Saudi Arabia has set up “The Garage: Start-up District”, which is a combination of physical location, start-up incubator, accelerator to provide start-ups with grants, investment, marketing, and training support, full-service workspaces.
A multinational organisation dubbed the Digital Cooperation Organisation (DCO) was also established to enable digital prosperity with the passport making it quicker, easier, and less expensive for start-ups to do business across borders, opening up potentially lucrative markets with a combined population of more than half a billion people.
“The Start-up Passport reduces administrative and financial burdens and accelerates corporate registration and other processes for entrepreneurs. Through this passport, they will be able to enter the markets of other DCO member states,” said Deema Al-Yahya, Secretary General of the DCO.
Speaking at the inaugural Leap22 tech summit in Riyadh in February, Saudi Minister of Communications and Information Technology Abdullah Alswaha said the gulf country has decided to leap forward and chart a path towards a tech-powered economy.