Kenya has a plan for growth and hopes that economic growth will solve the issues of poverty and unemployment, particularly for young Kenyans. There is a clear recognition by the government and others in Kenya that SMEs are a key part of that strategy. There are a number of government-supported initiatives promoting various interventions, and a significant portion of the banking sector recognises the market opportunity SMEs present. The question of how coordinated and effective these initiatives are remains to be answered and the ecosystem needs some nurturing.

 

Key findings

There is an abundance of organisations working in Kenya to support entrepreneurship and enterprise development. In particular, there are a number of organisations focused on incubation and acceleration services. Universities and technical institutes are also numerous, offering a variety of curricula, services and events. The agricultural sector and the technology sector (in particular software and mobile applications) are covered by a number of organisations. There are also ample services for engaging women, youth and young entrepreneurs, and a number of financing products and financiers that SMEs can access.

Despite this good work, there could be greater coordination and segmentation between organisations, as well as more clarity and transparency as to how they fit and work together and the differences between them, with a keen eye towards easy and accessible information for entrepreneurs and SMEs. There are systemic gaps, which need to be considered. In particular, the focus of the ecosystem is Nairobi, where most of these organisations are based, thus leaving an absence of stimuli and services in Mombasa, Kisumu, Nakuru and more rural areas. There is a lack of support for basic product and service companies for the consumer market. Whilst many financing options are available, there is a gap between supply and demand that needs to be resolved, particularly for early-stage non-collateral-based equity and debt. There is a need for angel investment. There are also talent gaps, both in the organisations providing services to SMEs and in senior roles in start-ups.

Other resources

  • ANDE's ecosystems mappings library contains other useful resources, indexed by region and country.

About Argidius’ mappings

We regularly commission SME ecosystems mappings in our target geographies. These studies are intended to give contextual overview and shed light on the challenges and opportunities for SME development and poverty alleviation. They include an inventory of service organisations and an analysis of the services landscape including areas of unfulfilled needs (gaps) Argidius use these maps to help identify organisations positioned to address these gaps.