Kizito Okechukwu | June 7, 2023
If one speaks to entrepreneurs that have scaled their business amidst the challenges they faced when starting, one of the biggest stumbling blocks most will mention will be lack of access to capital.
In-depth research has also shown that many businesses fail due to little, or no access to capital and effective capacity building programmes. Capacity building for SMEs basically means putting together measures that will assist them to grow their business, which could include, but not limited to, operational soundness, financial management, talent management and building a strong management team. Through capacity building, SMEs are more prepared to access various markets that they would not have necessarily accessed and also enjoy the support to access the financial capital that they may need to stabilize and scale their business.
The story of how African Bank started is a story of how most, if not all businesses started. The history of a few black businessmen who felt that other banks did not serve their business needs joined forces and put some money together to start a bank. Yet this collaboration could not raise the R1m that was needed to start a bank in 1964. However, they fought hard and long and a decade later managed to raise the funds required.
This is the major challenge of every business. Even the likes of Airbnb shared a story of how no-one believed in them back in Silicon Valley because investors couldn’t buy into their concept that homeowners would allow a total stranger to stay in their homes. How wrong they were. Today, Airbnb has transformed the accommodation industry more than one would ever have imagined.
As entrepreneurs, it’s all about the audacity to believe that anything is possible. As co-founder of Netflix Marc Randolph once said, “no one really fully knows if an idea will work till it’s put out there and tested”.
Last year, African Bank embarked on a journey in partnership with 22 On Sloane to support 20 SMEs every year with capacity building programmes. These SMEs will have the opportunity to access African Bank’s supply chain and network. The programme includes intense mentoring and coaching and the opportunity for the SMEs to pitch their business to the Bank’s supply chain and executives. From the 20, five businesses came out tops and earlier this week they were awarded R200 000 each for their business. The Bank is now working on ways to potentially integrate them into their business.
As Edna Montse the African Bank Executive for Transformation and Sustainability said, “Building entrepreneurs is not an easy task. In most developing economies, SMEs are the engine of the economy. The reality is that it’s a lonely journey for most SMEs and giving them the support to continue growing and having corporates also chip in on their journey gives them the audacity to keep believing that anything IS possible”.
The private and public sector must continue supporting SMEs through effective capacity building programmes, while also ensuring they have access to capital.
Kizito Okechukwu is the Executive Head of 22 On Sloane and co-Chair of the Global Entrepreneurship Network (GEN) Africa.
