New Report Identifies 68 Organizations Promoting Entrepreneurship in Ethiopia

A new report by Africa Business Incubator Communities (BIC Africa) has mapped the support ecosystem in Africa, identifying 68 organizations and initiatives in Ethiopia whose activities focus on promoting entrepreneurship.

The report, which was made public in February 2023 by the regional network supporting business incubators, assessed 393 public, private, and non-profit initiatives in Africa.

In its finding, BIC identified accelerators, associations or networks, co-working spaces, incubators, investors, access-to-finance (A2F) organizations, other service providers, programs/projects, start-up competitions, and university-based incubators active in Ethiopia.

The report found that almost half of the organizations/initiatives fostering the development of entrepreneurship in Ethiopia do not focus on a given market sector (52%), but instead support small and medium-sized enterprises (SMEs) and start-ups from any sector.

Conversely, sector-focused organizations and initiatives represent 48% of the total, with the tech/digital sector accounting for 23%, the agriculture sector for 13%, and the energy sector for 4%.

The report indicates that most of the services provided comprise capacity building (44%), which focuses on training entrepreneurs and the labor force on new skills, while funding and networking services which aim to provide assistance in accessing sources of finance represent 10% of the total share.

Services directed at infrastructure development, whether providing or upgrading them, only represent 4%. In contrast, internationalization was the least common orientation for most organizations/initiatives operating in Ethiopia, representing only 1%.

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BIC further states that programs/projects are the prevailing type of initiative seen in the country at 36%, followed by incubators (18%). BIC also analyzed the weight of each type of governance model (non-profit, private, and public) and found a balanced distribution, with non-profit organizations/initiatives representing the most at 38%.

However, only 2% of the organizations/initiatives provide specific support for vulnerable social groups such as women, children, youth, the elderly, and ethnic minorities.

In addition, the report also found that the distribution of organizations/initiatives operating in the country is well-balanced, contrary to the commonly held belief that they are mostly concentrated in Addis Ababa. The capital hosts 46% of them, while non-capital cities hold 19%.

BIC Africa, launched in 2021, focuses on four main African countries: Angola, Ethiopia, Madagascar, and Somalia. BIC started its work in Ethiopia in October 2022 with a budget of 5.5 million euros for the next four years.