I had never really experienced the good old ‘German efficiency’ until I met The Ambassador of the Federal Republic of Germany to Botswana Margit Hellwig-Bötte and her team in early February of 2022. I mean sure, I had once driven a Volkswagen - and sat in a Mercedes-Benz, but never a firsthand experience of the world’s most admirable work ethic.
The Ambassador had convened ecosystem players for a roundtable discussion at the German Residence in Gaborone, Botswana. The discussion was held under the theme “The start-up ecosystem in Botswana – unlocking entrepreneurship potential with a regional perspective” and the consensus was that the fragmentation was Botswana’s startup ecosystem greatest impediment. By the end of that very sitting, there was a resolution to host a series of startup events dubbed BotswanaUP! StartUp Connect Week - with actual timelines! As a doer, I was very impressed.
Since its inception, Market Players, has been intentional about converging stakeholder efforts towards developing an enabling entrepreneurship ecosystem. In April 2022, we hosted BotswanaUP! Fireside Chat with support from Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) through Make-IT in Africa. The event convened founders, investors, academia, and policy makers to not only discuss challenges in the start-up ecosystem but align on interventions. The conversation took the format of a traditional Setswana kgotla (townhall) meeting to allow for open discourse. We discussed, amongst other things; the role of hubs in the start-up ecosystem; ways to broaden and deepen the start-up funding base; the meaningful inclusion of youth and women; as well as, facilitating access to local and regional markets. When all was said and done, I was left wondering how Market Players, as a small non-profit with limited resources could drive the implementation of such a mammoth task.
I am a doer, so when I lead, I don’t just lead in thought; I lead in action. The Make-IT in Africa Women in Leadership Program administered by Stellenbosch Business School has been instrumental in guiding me on how to actively solve challenges in pan-African entrepreneurship and innovation ecosystems by practically applying my creative intelligence. So, when I asked my professor Dr Cherylene de Jager how I could navigate the resource limitation issue, she succinctly said “scarcity is a very powerful innovation catalyst, work with what you have.” God knows I needed to hear that because I’ve come to embrace the inherent difficulty and complexity of leadership. Leadership is selfless, and it is dutiful, and it places a bearing on you that transcends the fancy title. So, it is much easier for one to passively bemoan our startup ecosystem’s systemic inefficiencies, but to roll up one’s sleeves and bear the brunt of actively solving them is a whole new ball game.
My observation is that, above all things, the fragmentation that exists in Botswana and many African startup ecosystems is a result of a lack of shared vision. On paper, all stakeholders agree that startups and small and medium enterprises (SMEs) are the backbone of African economies, but I can’t confidently say that they all perceive and value them as such - at least not fully. However, without shared vision, shared effort is a fallacy. A silo approach to startup ecosystem development is purpose defeating because systemic problems need systemic solutions. For one, startups and SMEs need consistent support which involves an immense amount of handholding and a series of funding rounds. This is a very expensive and risky exercise that no single entity can sustainably bear on its own, especially when dealing with a large pool of first-generation entrepreneurs - as we are.
What shared vision and shared effort does is, it spreads the risk (and rewards) of ecosystem development amongst entrepreneurship support organizations, investors, academia, and policymakers. In September 2022, Make-IT in Africa invited me to a startup ecosystem tour in Munich. I was completely blown away by how the Free State of Bavaria was able to prioritize innovation and digitalization to establish the City of Munich as one of Europe's leading startup hubs in less than 10 years. In 2021 alone, Munich startups raised close to four Billion Euros and churned at least seven unicorns.
In September 2022, Make-IT in Africa invited me to a startup ecosystem tour in Munich. The trip inspired a collaboration with the University of Botswana (UB). © GIZ/Armin Smailovic
One of the outstanding details was that 47% of the seed rounds in Munich came from domestic Venture Capitals (VCs) while 26% and 10% came from the European Union (EU) and the United States of America (U.S) respectively. However, in scale up rounds (C+), 68% of the funding came from the U.S while 16% and 7% came from EU and domestic investors respectively. This means that, Munich investors were the first to bet on Munich startups; at the early stages, when it's risky and funding matters the most.
It was interesting to benchmark how private money and public money dovetailed to develop an enabling startup ecosystem with a high-quality deal flow. I noticed that Munich startups thrive off the backdrop of a wide selection of incubators and accelerators; and these hubs thrive on multi-stakeholder effort. This was evidenced by Münchner Technologiezentrum (MTZ) a co-working space that sustains its operations from subsidized rentals, while leveraging facilities funded by the Bavarian State government through City of Munich; as well as, UnternehmerTUM a startup hub that leverages financial and technical support from a state university, Technical University Munich (TUM) and a Bavarian corporation, Bayerische Motoren Werke (BMW).
Some more highlights from our trip to Munich.
I was so inspired by UnternehmerTUM’s stakeholder engagement strategy that as soon as I landed in Gaborone, I approached Botswana’s largest and top-ranked institution of higher education, the University of Botswana (UB) regarding our long-sought Market Players Entrepreneurship Hub. I’m pleased to share that collaborating with UB has taken a huge burden off Market Players shoulders by reducing our capital outlay by a whopping 90% - how’s that for efficiency! The hub will offer youth and women owned startups and SMEs free access to a co-working space with internet access, presentation tools, as well as practical entrepreneurial training and mentorship.
At Market Players we firmly believe that entrepreneurship is the most practical, timeous, and measurable solution to sustainably removing the over 400 million Africans living on less than two U.S-Dollars per day out of abject poverty. This is because entrepreneurship creates economic opportunities that trickle real income down to real people in real time. Our target is to develop at least 1000 impact-driven African entrepreneurs who will play a critical role in driving Sustainable Development Goals 1,5, 8 and 10 by 2025. To date, our work has reached over 13,000 people and directly impacted over 350 African entrepreneurs, over 80% of whom are youth and women between the ages of 18 and 35.
As we press forward, I solemnly hope to see more stakeholders buy-in to the Market Players vision; because we are more efficient when we are aligned in thought and in action. And as we rally African entrepreneurs to be the front-runners of the African Continental Free Trade Area (AfCFTA) agreement, the efficiency of pan-African entrepreneurship and innovation ecosystems has never been more pertinent.
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About the author: Katlego Mokgethi is the founder of Market Players, a Botswana based entrepreneurship support organization working to improve the competitiveness of startups and SMEs across Africa.
Katlego believes that Africa can develop effectively and timeously through entrepreneurship and innovation, so she invests her best energies on training African entrepreneurs as well as improving their access to markets and funding opportunities. She also volunteers as a mentor on various entrepreneurship development initiatives such as Seedstars, Youth Challenge International, Africa’s Business Heroes and Young African Leaders Initiative (East Africa).
