Tech Hubs in Africa: Accelerating start-ups for resilient growth - 3rd Edition

ACCELERATING START-UPSFOR RESILIENT GROWTH3rdEdition © International Trade Centre 2024 The International Trade Centre (ITC) is the joint agency ofthe World Trade Organization and the United Nations. Street address:ITC54-56, rue de Montbrillant1202 Geneva, SwitzerlandPostal address:ITCPalais des Nations1211 Geneva 10, SwitzerlandTelephone:+41-22 730 0111Fax:+41-22 733 4439E-mail:itcreg@intracen.orgWebsite:www.intracen.org Tech Hubs in Africa ACCELERATING START-UPSFOR RESILIENT GROWTH3rdEdition About the report African tech hubs – now more than 1,000 across the continent – accelerate digital, social and economictransformation as they support start-ups. The report examines the COVID-19 impact on tech hubs and offers recommendations for future operations.It surveys 52 tech hubs across Africa and includes interviews with dozens more. It identifies resilient businessmodels that weathered the pandemic. The ability to digitalize their services is the most defining parameterfor resilient tech hub success, according to the ITC survey. This report serves also as a toolkit for governments and funders to invest successfully in tech entrepreneurshipsupport infrastructure. It concludes with practical recommendations and underlines the importance of hybridsupport and digital service delivery. Publisher:International Trade Centre Title:Tech Hubs in Africa: Accelerating start-ups for resilient growth (3rdEdition) Publication date and place:Geneva, February 2024 Page count:96 Language:English ITC Document Number:P127.E/SEC/DECI/24-III Print ISBN:9789210030953 PDF ISBN:9789213588604 Sales no.:E.24.III.T.4 CitationInternational Trade Centre (2024).Tech Hubs in Africa: Accelerating start-ups for resilient growth(3rdEdition).ITC. Geneva. For more information, contact: Martin Labbé atlabbe@intracen.org ITC encourages the reprinting and translation of its publications to achieve wider dissemination. Short extractsof this paper may be freely reproduced, with due acknowledgement of the source. Permission should berequested for more extensive reproduction or translation. A copy of the reprinted or translated material shouldbe sent to ITC. Digital image(s) on the cover: ©International Trade Centre (ITC) Foreword Africa’s large youth population and high rate of entrepreneurship are stoking hopes that high-growth start-ups,especially in the technology sector, can create quality jobs while filling major gaps in providing important goods andservices for communities. But often these start-ups run up against significant challenges, from lack of informationand skills to limited access to finance and infrastructure. That, however, is where tech hubs are making a difference. From just a smattering of hubs in the continent a decade ago, there are now over 1000 tech hubs across Africa.These hubs provide digital entrepreneurs and established firms with support to test out ideas, develop theirbusinesses, and forge new relationships. Crises of recent years have tested these hubs’ resilience, while sheddinglight on what needs to change so that these hubs can continue doing what they do best, regardless of what thefuture may hold. This third edition ofTech Hubs in Africaexamines what the COVID-19 pandemic meant for African tech hubs,along with the lessons learned. The report incorporates both survey data and tech hub “success stories” to showwhat worked well and why, along with what risks and vulnerabilities became apparent during a period of crisis. Ghanaian Nelson Amo is one such success story. He founded Innohub in 2014, followed by the Accra AngelsNetwork in 2019. He also sponsors Wangara Green Ventures, an SME fund that invests in local, climate-smartbusinesses. By 2020, he had become an influential player in building up Ghana’s digital economy. When thepandemic struck, he pivoted to make sure Innohub could keep supporting entrepreneurs, namely by seekingout high-impact projects in neighbouring countries. Thanks to these efforts, Innohub has become an expert insourcing the best innovation projects for investors, which is a service that it now provides throughout West Africa. Nelson Amo was not alone: the COVID-19 pandemic prompted many tech hubs to expand their digital capabilitiesand offer new services. Uganda’s StartHub Africa, Tunisia’s Open Startup, Senegal’s CONCREE and Zimbabwe’sCUBE are among those hubs which successfully used digital tools for incubation and acceleration services.Conversely, those tech hubs that were unable to make a big digital leap suffered during the pandemic. Manyhubs closed their premises and sent their staff home to limit contact, some temporarily and others permanently.The closure of premises, in turn, hurt their revenues. In other words, this report shows that one of the biggest factors in whether a tech hub can survive a crisis is inits ability to adopt digital tools for delivering services. Also key, this report shows, is the ability for these hubs todiversify their business models a