New Report Identifies 68 Organizations Promoting Entrepreneurship in Ethiopia

A new report by Africa Business Incubator Communities (BIC Africa) has mapped the support ecosystem in Africa, identifying 68 organizations and initiatives in Ethiopia whose activities focus on promoting entrepreneurship.

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The report, which was made public in February 2023 by the regional network supporting business incubators, assessed 393 public, private, and non-profit initiatives in Africa.

In its finding, BIC identified accelerators, associations or networks, co-working spaces, incubators, investors, access-to-finance (A2F) organizations, other service providers, programs/projects, start-up competitions, and university-based incubators active in Ethiopia.

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The report found that almost half of the organizations/initiatives fostering the development of entrepreneurship in Ethiopia do not focus on a given market sector (52%), but instead support small and medium-sized enterprises (SMEs) and start-ups from any sector.

Conversely, sector-focused organizations and initiatives represent 48% of the total, with the tech/digital sector accounting for 23%, the agriculture sector for 13%, and the energy sector for 4%.

The report indicates that most of the services provided comprise capacity building (44%), which focuses on training entrepreneurs and the labor force on new skills, while funding and networking services which aim to provide assistance in accessing sources of finance represent 10% of the total share.

Services directed at infrastructure development, whether providing or upgrading them, only represent 4%. In contrast, internationalization was the least common orientation for most organizations/initiatives operating in Ethiopia, representing only 1%.

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BIC further states that programs/projects are the prevailing type of initiative seen in the country at 36%, followed by incubators (18%). BIC also analyzed the weight of each type of governance model (non-profit, private, and public) and found a balanced distribution, with non-profit organizations/initiatives representing the most at 38%.

However, only 2% of the organizations/initiatives provide specific support for vulnerable social groups such as women, children, youth, the elderly, and ethnic minorities.

In addition, the report also found that the distribution of organizations/initiatives operating in the country is well-balanced, contrary to the commonly held belief that they are mostly concentrated in Addis Ababa. The capital hosts 46% of them, while non-capital cities hold 19%.

BIC Africa, launched in 2021, focuses on four main African countries: Angola, Ethiopia, Madagascar, and Somalia. BIC started its work in Ethiopia in October 2022 with a budget of 5.5 million euros for the next four years.