Entrepreneurs and small businesses have long been regarded as the engines that power the global economy, but the thing that sets a local corner store apart from a startup built in the cloud is the rate at which they can scale.
That is according to Sarah Heck, an advisor on international entrepreneurship and youth programs to the Obama Foundation and head of entrepreneurship at Stripe, who told Disrupt Africa offline businesses are bound by the physical limitations of a brick-and-mortar market.
"Tech-enabled startups, on the other hand, can operate on internet scale from day one; propelled by software that makes the fundamental aspects of reaching a broad user-base and going global a lot easier," she said.
Africa is a continent brimming with creativity, resourcefulness and untapped opportunity, Heck said, but there is a lot more to do to realize its full potential as an entrepreneurial hub. The latest Global Entrepreneurship Monitor ranked Africa as the region with the lowest proportion of entrepreneurs expecting to create six or more jobs within the next five years.
"We all need to do more to change that statistic. At Stripe, we think a lot about how we can lower the barriers to entrepreneurship, help more businesses get started, and expand into new markets. We do this because we believe that helping entrepreneurs be successful will advance economic growth and create more opportunities for others," Heck said.
Stripe fits into a similar category, she said.
Something that really excited the Obama Foundation about the young leaders selected for its Leaders: Africa programme was their focus on tackling Africa's greatest challenges through entrepreneurship.
"The Ayanleye brothers built Stutern to address rising youth unemployment in Nigeria by equipping graduates with in-demand skills like UI/UX design and back-end development and placing them in higher-paying jobs. AkiraChix is teaching a generation of young women to code. Agro-Hub in Cameroon is leveraging technology to bring thousands of offline farmers into the online space. The solutions they're building have the potential to shape the future of the African economy. We want to do whatever we can to remove the blockers that may stand in their way," said Heck.
Asked whether there is enough support for young people starting their entrepreneurial journeys, she said perceptions around entrepreneurship were culturally nuanced.
"It's a risky path and the fear of failure often discourages promising entrepreneurs from getting started. Even on an anecdotal level, I was struck by the number of young people I met throughout the Leaders: Africa convening who told me that their parents would be disappointed if they pursued entrepreneurship as a career choice. Emerging female founders, in particular, grapple with the additional challenge of the cultural expectations of young women," said Heck.
This is where the local startup ecosystem becomes an invaluable safety net.
"We need to highlight local role models, foster an environment predicated on mentorship, up-skilling and knowledge-sharing, and develop a cultural understanding that failure is par for the course," she said.
Heck said that is why Stripe started its Atlas programme, to reduce the cost, toil and time spent on setting up a company, so entrepreneurs can focus their limited resources on building the best possible product or service for their customers.
She said any robust startup ecosystem relies on close collaboration between the corporate sector, government and academia to thrive.
"There are three foundational layers to consider. The first is education, be it formal or informal. Do entrepreneurs have the skills and mentorship to turn their ideas into thriving businesses? Are we creating a pipeline of talent with relevant skills to join those businesses and help them grow? Is the curriculum adapting to the needs of the modern internet-driven economy?" said Heck.
The third, meanwhile, relates to enabling businesses to scale.