The Somo Project (Somo) is an accelerator that supports businesses run by entrepreneurs from low-income urban communities. Somo select promising entrepreneurs from informal settlements and walk with them through the journey of launching and growing sustainable businesses, providing support in the form of training, mentoring, advisory services, market access and funding.
In 2019, Argidius partnered with Somo, providing a grant to support the expansion of core services within and beyond Nairobi, and to bolster the monitoring and evaluation of programs. In 2021 and 2022 an independent evaluation was conducted to assess the three main interlinked services of Somo Academy; Somo Invest and Somo Channels and provide recommendations to enhance Somo’s value proposition and impact. The evaluation focused on the 192 entrepreneurs accepted into in the accelerator, supported at a cost of roughly $2,400 each. Data relates to the period of 2016-Septmber 2021. These entrepreneurs had graduated from Somo’s start-up training called Buruka.
Key findings
- Since 2016, 192 entrepreneurs have participated in the accelerator. 162 entrepreneurs were supported between 2019-2021, and during this time span (when Covid was in full effect), the enterprises they started had generated $1.2 million in revenues and created 454 direct jobs. The total cost of support, including set up, oversight and delivery is estimated at $600,000. Therefore, at this juncture an investment of $1 in the program created revenue of $1.8 at enterprises in low-income communities, and more impressively direct jobs have been created at a cost of $1,500 each.
- There is strong evidence that Somo contributed to these outcomes. Somo’s wide range of services played different and complementary roles with different entrepreneurs. Services range from knowledge of business management, access to markets through events and online sales channels, access to finance through grants and matching with loan providers, business record keeping and reporting, and a production facility.
- The most valued services are the grant finance, principally used to purchase equipment, stock and finance operations; market access support through the Somo’s online sales channel, market events, and branding and packaging; DigiKua- the record-keeping tool; and the Buruka training which uses the lean start-up methodology, and was consistently referenced as the reference point of changes that businesses were then supported to action with the help of the follow-on services. Somo’s approach also led to developments in entrepreneurs’ perceptions and mindsets on doing business.
- There is evidence that the delivery model, consisting of a combination of services, is effective and contributed to business growth, especially for the 20% of enterprises that have generated more than $5,000 in incremental revenue each.
