Start-ups tread on dangerous ground without mentors
Mr Huba. He is urging start-ups to appreciate training and experience. Correspondent
Regional integration and the growth of business process outsourcing are opening huge opportunities for businesses — from expanded markets to new classes of products and talent.
But business experts are warning that most small and medium size enterprises in East Africa are not reaping optimally from these opportunities because they lack necessary skills.
Entrepreneurship experts at Inoorero University say most micro, small and medium enterprises (MSMEs) do not have the systems, technical expertise and capital to exploit opportunities.
Mr Daniel Huba, the co-ordinator of the Regional Centre for Enterprise Development (RCED), says the East Africa Common Market, the independence of South Sudan coupled with the growing BPO industry and increased economic activity, have created many business opportunities for the MSMEs.
All this heap of ruin is tied to limited mentorship programmes, the experts say.
In countries like the USA where mentorship is developed, success rate of start-ups is high, compared to Kenya where 90 per cent of start-ups don’t survive to see their third birthday.
“From our engagement with the entrepreneurs through the annual Enablis business Launchpad competition,” Mr Huba says, “we noticed that most of the MSMEs have no business systems, they are not particular on value proposition they offer to their target market. Some are not clear on their market focus nor do they understand the purchasing criteria of their customers.”
He added: “Others are either choking from cycles of loans or are not aware or prepared to access financial services. Generally ambition for growth is lacking.”
With a huge pool of mentors, RCED predicts a reduction in the number of start-ups closing shop when they have experienced hands taking them through turbulence until they find a footing.
The centre has launched a mentorship plan to equip entrepreneurs for success from management to market expansion and strategy execution.
The inaugural class was enrolled six months ago and is graduating on December 16. They will join a mentors network that trains entrepreneurs.
The mentorship is supported by the Royal Danish Embassy of Nairobi and is implemented in collaboration with International Labour Organisation – through the Youth Entrepreneurship Facility, Federation of Kenya Employers, Kenya Private Sector Alliance, Africa Youth Trust, Enablis and Kenya Association of Women Business Owners.
The course targets practising and aspiring business consultants seeking to create a niche in the MSMEs sector, entrepreneurs, loan/credit officers and financial advisers working with small businesses.
Others are government officers working in the industry, NGO leaders, and other managers focused on business mentoring as a career, said Mr Huba.
RCED is eyes the entire East Africa, where it says there’s a shortage of mentors. Although universities offer business courses, experts say graduates need specific training to complement the classroom knowledge.
Universities are also establishing business incubators where ideas from among students.
“Effective business mentorship ought to be structured,” he says. “It needs to have both technical input, or what we call business competencies such as concepts and models, as well as the soft or mentoring competencies such as empathy, trust building, appreciative enquiry.”
And just the way businesses invest in human and financial capital, he says, so should entrepreneurs set aside funds for mentorship.
Through mentoring, the candidate is able to clearly identify and set goals, tasks and responsibilities from the onset and a clear time frame as agreed with the mentor.
The RCED mentorship training is two-pronged: the business dimension, which focuses on technical competencies and models such as business idea formulation and consolidation, systems analysis, creating and financing growth.
On the other hand, mentors are equipped with soft skills such as soul profiling, use of assumptions, emotional intelligence, listening and questioning techniques among others.
Specific goals
For mentorship to be effective, Mr Huba says, the trainer and the candidate need to agree on specific goals and targets of the programme, learn and understand each other and establish roles and commitment.
The mentor is the adviser, analyst and never a decision maker, says Mr Huba. On the other hand, the mentorship student must be open and ready to act on decisions. “MSMEs must start viewing business mentorship as a professional service.”
