The Outbox isn't just Seedstars Kampala Partner, but also Features one of the best views in town.
For the first time, Seedstars World is heading to Uganda. Julien and I set out to explore the startup ecosystem in Kampala. Read on for our lessons learned!
1. Testing the waters
Unlike Rwanda, the Ugandan government does not yet invest heavily into the startup scene. Instead, it’s still testing out which measures might be the most effective, often opting for grass root options. This includes material sponsorships that range from cement to seeds, depending on industry.
2. Wanting the impossible
As it often is, a big issue is investment capital. Ugandan startups do not have access to angels or VCs (there is still no true investment culture in Uganda), and must resorts to bank credits for funding. However, banks often impose nigh impossible conditions for startups, like material collateral and too high interest rates.
3. Well traveled
The 5 neighboring countries of Rwanda, Tanzania, Burundi, Kenya, and Uganda are closely intertwined, culturally, historically, and economically. This makes travel quite easy, especially if you have a multi-national startup. Not so travel friendly: the import taxes. Depending on the country, customs can be incredibly high.
4. Cracking the glass ceiling
Female entrepreneurs are still struggling in the Ugandan startup ecosystem. However, Asia Kamukama of Maendeleo Foundation Uganda and GIPOMO’s Best Ayiorwoth are good examples of women fighting against these barriers and winning. They’re both featured speakers at the Mara Foundation Entrepreneurs Networking Workshop this 11th of July, so check them out if you’re in Kampala!
5. Friends and Family, but no fools
Don’t expect to make your Ugandan parents proud when you announce that you want to be an entrepreneur. The local mentality isn’t very welcoming yet towards startups and their founders. This makes looking for a co-founder hard, but as we’ve often seen in Africa, many entrepreneurs prefer riding solo- even if there biz dev strategy wouldn’t.
6. Darling, we’re the young ones
Youth may make for good sitcom material but in reality, overwhelming birth rates often result in youth unemployment. Uganda is Africa’s youngest nation with 77% of its population being under 30 years of age and unemployment rate for young people of ages 15 to 24 is 83%. Uganda no longer has the wealth of government jobs that sustained the previous generation, so better education measures (illiteracy is still a big problem) entrepreneurship may be what the countries needs to get out of this slump.
7. Big Brother Kenya
What Nigeria was to West Africa, Kenya is to the East. Uganda is in a flux between competition and cooperation with Kenya, as many people from either nation will switch back and forth. A lot of trade is done between the two nations as well, and for entrepreneurs here, it is well advised to set up business to allow for expansion into Kenya.
8. Pulling out
Uganda’s stark stance on homosexuality is not only endangering its people’s civil rights, but also economic stability. Several international corporations that supply aid are currently pulling out, leaving locals afraid that they’ll be subject to high inflation rates and increasing unemployment.
9. Hit the books
Kampala’s startups have a major weakness: failures are often linked to insufficient market and business strategy research. Co-working spaces like #SSWKampala partner the Outbox or Hive Collab, as well as biz dev support Mara Foundation are working hard on remedying the issue. The Outbox does several entrepreneurial jam sessions and Mara Foundation offers several conferences and workshops for startups ready to polish their product.
10. Show me your teeth
Despite all the struggles, Kampala’s startups are rearing to go. Even after failing, Ugandan entrepreneurs are incredibly ambitious, willing to expand and get their feet wet yet again. This attitude, along with a better biz dev education, is what the Pearl of Africa may need, as any startup push within the nation will have to come from the inside.
Extra points: Yum! For the most part, Uganda has no issues with food supply and a wealth of fruit and vegetables are seasonally available. Try the jack fruit amongst other local specialities.
(Seedstars World Travel Team)
Nellie graduated from University of Mannheim with an Economics Major and has lived in the USA, Germany, and Spain. After part being of the Deutsche Bahn’s Investor Relations team, she specialized in Innovation Management. Nellie has gained expertise in many aspects of the R&D process, thanks to her multi-million euro project assistance at the Helmholtz Centre Berlin, co-authoring a publication on German cities’ innovative behavior at the Center for European Economic Research, and working at the pioneering SAP Innovation Labs. At Seedstars World, she will pair her financial experience with tech savvy while organizing the 2014 tour as one of our scouts!
Connect with Nellie or follow her on Twitter @Nellie_Horn