Multitasking hampering business growth among start-ups - experts

Foreign investment experts have attributed the rampant and quick collapse of start-up businesses and Small and Medium Enterprises(SMEs) in Uganda to failure by entrepreneurs to concentrate and persevere in one business at a time.

“Perhaps because of the pressure to survive, it is not uncommon to find a young entrepreneur running about five businesses concurrently; all of them dealing in different commodities. This is not appropriate,” said Laura Smeets, an Investment Director at BiD Network.


Ivan Korsak, Belgian Trade Commissioner based in Nairobi addresses the entrepreneurs

 
“It is paramount that any business owner, especially those starting out, concentrate and preserve in on one category of business that way they do not split their allegiance, time and effort,” she said.

Smeets was speaking at BiD Network’s Investment Readiness Programme 2017 for Ugandan entrepreneurs at Piato Restaurant in Kampala last Friday.

BiD Network is a Dutch Organisation that stimulates local entrepreneurship and economic growth in emerging markets like Uganda by linking SME entrepreneurs to investors in different countries worldwide.

Smeets said at one point when the business becomes sustainable, there is need for the business owner to professionalize it.

“As the business grows, the right skills are required to compete in producing quality especially for those in manufacturing business. However, employing such talent is expensive. Others do not take right skills as serious issue in business.”


Anthony Natif (L), the director for Guardian Health Pharmacies addresses entrepreneurs

 
Bjorn Macauter, an investor from Belgium said Ugandans have the will to start businesses but face several hindrances such as failure to choose the best merchandise of products to deal in. “Some have business ideas but are unable to start business because they lack the capital yet banks charge high interest rates,” he said.

Michael Muwonge, the General Manager at Financial Access Commerce and Trade Services (FACTS) Uganda Limited, an international business development company, said some micro and small and medium enterprises imitate their colleagues while starting businesses yet they lack the necessary skills in executing those businesses hence their eventual collapse.

Way forward

Ivan Korsak, Belgian Trade Commissioner based in Nairobi, Kenya advised entrepreneurs to work hard and network with different business people in and out of the country so that they create market for the products as well as gaining more business skills.

“Contacts are very essential for the business to boom but should be done with people who matter in terms of giving advice among other benefits,” he said.


Laura Smeets speaking to Karen Kana from Kyambogo University department of vocational studies

 
Keren Okuvuru Asiimwe, an administrator at Netherlands - Uganda Trade and Investment Platform (NUTIP) said people’s negative mindset about agriculture need to change.

She noted that once people use value addition in agriculture, they end up getting a lot of money as well as ensuring food security in their homes.
She said there’s need for government and non-governmental organisations to come on board and support people in agro-business by training them on essential skills in agriculture.
What business people say?

Investment readiness

Muwonge pointed out issues that investors look at before partnering with emerging entrepreneurs such as historical business existence, collateral, credit history, commitment among others. He also said discipline while handling business money is very critical.

The Investment Readiness Programme prepares emerging market SMEs for investment by international investors through business strategy support to emerging entrepreneurs in order for them to put their business plan on one single page.




 
Through the programme international experts assist local entrepreneurs with making their financial model and investment strategy; personal coaching to prepare their business presentation for investors; training in pitching for upcoming investor meetings as well as one-on-one matchmaking support between local business owners and investors.

After the programme, Ugandan-based businesses with annual revenues of $100,000 ($360m) with a strong entrepreneurial team, proof of market, scalable business model and social impact will have a chance to participate in BiD Network's upcoming Impact Investment trip in September / October 2017. They will stand to win loans and equity ranging from $10,000 to $1m.