ENTREPRENEUR ESTABLISHMENT PROGRAM...Entrepreneur Establishment Fund (EEF) as it has taken shape...

ENTREPRENEUR ESTABLISHMENT PROGRAMA Solution for African Entrepreneur Support

Concept Document

Developed by:

The Young Innovators Working Group

Authors:Moses Acquah, Lucas Boller, Tafadzwa Chiganga, Mariska van Gaalen, Wadzanai Motsi-Khatai, Chido Nyandoro, Tendai Pasipanodya, Neeraja Venkataraman

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1. Background

2. The Entrepreneur Establisment Program

3. The Entrepreneur Establishment Fund

4. The Process: From Inception to Launch

Notes and References

Table of Contents1.1 The Context1.2 The Mandate1.3 Young Innovators' Co-Creation Workshop1.4 Existing Initiatives by Key Stakeholders

2.1 Overview2.2 Financial Support

2.3 Non-Financial Support

2.4 Review and Evaluation

3.1 Proposed Structure of the EEF

3.2 Potential Costs of the EEP

2.2.1 Application and Disbursement2.2.2 Convertible Loan Ticket Sizes

2.3.1 Capacity Development A

2.3.2 Capacity Development B

3.1.1 Pool of Investors and Philanthropists3.1.2 Blended Finance Approach3.1.3 Proposed Underlying Technology3.1.4 Engagement of Multiple Service Providers3.1.5 Management and Governance

3.2.1 Portfolio Expenses3.2.2 Portfolio Management Expenses

i) Mentoringii) Expert Pooliii) Peer-to-Peer Support

i) Business Tools and Trainingsii) Personal Developmentiii) Networking

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3.3 How Funding Needs are Determined 23

1.4.1 Existing Financial Programs1.4.2 Existing Non-Financial Programs

Annex 1: List of Stakeholders engaged 28

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1. Background

As the population grows, scores of people continue to enter the African labor market [1], and thecontinent faces an increasing pressure to provide decent work opportunities. Meanwhile, Africa stillstruggles to provide formal, stable working conditions with access to social and job security [2].Unemployment in Africa stands at 7.1% and globally, the region still has the highest vulnerableemployment rate of 65.8% [3]. The percentages for vulnerable employment are even higher when thegender dynamic is introduced. In Sub Saharan Africa, 74% of women compared to 61% of men [1] are inthis category which means women are more susceptible to exploitation at work, poverty and generalexclusion from policy reforms [4]. To address the employment needs of people across Africa, policymakers across the continent, and in partnership with the continent, have prioritized the need forinnovative and inclusive growth strategies. Young Africans often turn to entrepreneurship to create jobs for themselves and others, but struggle tofinance their business [5]. Research shows that these same enterprises are making the highest impactin addressing, not just unemployment issues, but also the poverty gender gap. According to the ILO, theshare of total employment of small to medium enterprises (0 – 99 employees) has increased from31.2% in 2003 to 34.8% in 2016, with a majority of these companies employing more women in theworkforce than larger companies [6]. African entrepreneurs highlight access to and cost of financing as major obstacles to businessdevelopment and growth. From the conversations held with the entrepreneurs at the EEP Workshop inAugust 2018, the following were the two main financing challenges faced by the entrepreneurs:

1.1 The Context

Attracting the right investors at the right time: Most investors are looking forcompanies that are at a stage where the entrepreneurs have not reached, andas such will not participate in any of the fundraising calls from theentrepreneurs. Those that do participate tend to request a significantly higherequity share that is, in most instances, unfair on the entrepreneurs.

High costs of borrowing: the shortage of investors puts the entrepreneurs in adesperate position where they are forced to approach banks for financialsolutions. The banks perceive them as a high risk and not only requirecollateral, which most entrepreneurs do not have, but also charge a significantlyhigher interest rate.

In short, African entrepreneurs have limited access to lower risk financing compared to theircounterparts in high-income countries. The above challenges are no surprise given the state of the financial markets in Africa. There remainsan estimated USD 190 billion financing gap for small to medium enterprises across the continent [8].Between 2012 and 2017, Africa raised USD 24.4 billion in private equity, with an average deal size ofUSD 7 million which is way above what most small to medium enterprises are seeking. While small tomedium enterprises in Africa account for 90% of all businesses in the region [10], African businessesare 19% less likely to have a bank loan in comparison to the rest of the world, with enterprises youngerthan 5 years being the least likely to have access to loans. This financing gap is compounded by a skillsand training gap as traditional education across the continent lags behind in incorporatingentrepreneurship and business development training [11].

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Capacity building networks and organizations have developed training and mentoring programs toclose this gap and to buld the necessary expertise to grow African enterprises. Nonetheless, farreaching educational reform is still critical to ensure that these training measures effectively reach thelarge entrepreneur base. Other obstacles to establishing a business for entrepreneurs include the lead-time to register a business, high registration fees, infrastructure challenges, access to electricity andpower, and corruption [12,13]. The EEP proposal is concurrent with global and continental goals of job creation, economic growth anddecent work as priorities for Africa. The Sustainable Development Goals drafted by the United Nationsand the High 5 priority areas identified by the African Development Bank have a shared vision topromote inclusive and sustainable economic growth in Africa [14,15,16]. Specifically, SustainableDevelopment Goal (SDG) eight highlighting the need to promote inclusive and sustainable economicgrowth, employment and decent work for all. Against this backdrop, the EEP serves as a uniquescalable platform to mobilize key actors and create an enabling ecosystem for entrepreneurs,subsequently facilitating job creation, wider and more secure employment and sustainable growth inthe continent. Partnership for investment facilitation and job creation is high on the priority list even forthe European Commission as evinced by the launch of its Alliance for Sustainable Investment and Jobsinitiative. This Alliance, part of the wider set of EU-Africa relations and strategic frameworks joiningEurope and Africa, seeks to boost investments and the investment climate through blending andguarantees, supporting education and skill development across the continent and ultimatelyenabling sustainable job creation [17]. The African Union and African Development Bank have alsoprioritized job creation and decent job growth under the Agenda 2063, and the Jobs for Youth in Africaand Affirmative Finance Action for Women in Africa (AFAWA) Programs respectively. Under the JfYA,the Bank is mobilizing resources to create 25 million jobs by 2025, prioritizing agriculture, innovation,and entrepreneurship [18]. Whereas the AFAWA seeks to mobilize USD 3 billion to enable womenowned and women led businesses [19].

On June 11th of 2018, a group of 30 African entrepreneurs, academics andexperts (“innovators”) were invited by the Deutsche Gesellschaft fürInternationale Zusammenarbeit (GIZ) and Afrolynk on behalf of the FederalMinistry for Economic Cooperation and Development (BMZ) to have aconversation with Dr. Akinwumi Adesina, President of the AfricanDevelopment Bank (AfDB) in Berlin, about the current challenges faced byAfrican entrepreneurs. The challenges spanned from accessibility ofaffordable financing to prohibitive policy frameworks and a limitedentrepreneur ecosystem. Following the event, the innovators were tasked todevelop an ideal solution that would address these challenges and betterserve young African entrepreneurs. A Young Innovators Working Group (“YIWG”) was convened following themeeting, to develop a concrete proposal that creates transparency andefficiency using appropriate technology and innovative policy to address thechallenges for Dr. Akinwumi Adesina in his return trip to Berlin in October2018. The YIWG shared views on challenges and ideas for improvementthrough a combination of written inputs and follow up calls. All the ideasshared by the working group were condensed by a core team into theEntrepreneur Establishment Program (“EEP”).

1.2 The Mandate

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In August of 2018, the YIWG convened a two-day workshop and follow-up meeting, to further develop the proposal in collaboration with the AfDB, GIZ, and BMZ. The workshop brought together resourcepersons, experts, young innovators, entrepreneurs, policy makers (GIZ, BMZ, AfDB) and thought leadersfrom the African diaspora as well as from the German startup and innovation scene, sharing thecommon vision of a prosperous Africa. Considering the existing funding opportunities and policyframeworks such as AfDB’s High 5 development priorities and Boost Africa Initiative and in coalitionwith the Africa Initiative and the Marshall plan with Africa by the BMZ, workshop participants iteratedthe proposal of a holistic technical and financial support program for African entrepreneurs. It wasnoted during the workshop that the EEP was strongly aligned with the mandate of the PresidentialYouth Advisory Group (PYAG) who were tasked to design an investment vehicle for SMEs. The EEP thenrepresents a potential solution and vehicle for different programs of the AfDB, GIZ and BMZ. Theoutputs from the workshop were subsequently consolidated and incorporated into the EntrepreneurEstablishment Program (EEP) proposal. This document outlines the proposal of the EEP andEntrepreneur Establishment Fund (EEF) as it has taken shape through stakeholder engagement so far.Further details, potential partners and detailed governing structures will be defined in the next phase ofthe project.

1.3 Young Innovators’ Co-Creation Workshop

Several initiatives to support entrepreneurs, both financially and technically are already underway in theregion. Existing projects can be leveraged to provide support under the EEP, and synergies created toensure the EEP is building upon existing support networks for entrepreneurs.

1.4 Existing Initiatives by Key Stakeholders

The African Development Bank, supported by partners, haslaunched several initiatives designed to provide financialsupport to specific industries to catalyze inclusive growthand job creation. Under the JfYA strategy, the AfDB hasdeveloped the Youth Entrepreneurship and Innovation Multi-Donor Trust Fund [20]. Through these, the Bank plans todevelop a resource center for entrepreneurs through anInnovation Lab among other initiatives. In partnership withthe European Investment Bank, and with financial andtechnical support from non-regional member countries anddevelopment organizations, the Bank launched the BoostAfrica [21] Program, an investment fund targeted at highlyscalable start-ups and SMEs by investing in a range of Seedand Venture Capital Funds across Africa which in turn investin tech enabled / high growth startups/early stagebusinesses. In 2016, it also launched the Affirmative FinanceAction for Women in Africa (AFAWA) Program, whichseeks to accelerate growth and employment creation acrossAfrican economies, by closing the massive financing gap forwomen led enterprises. Other opportunities exist to developstrategic partnerships with venture capital firms as well asexisting financial institutions and programs.

1.4.1 Existing Financial Programs

Photo Credit: Naija247News

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Initiatives to build capacity of entrepreneurs have been undertaken by organizations across thecontinent, focusing on regional development of entrepreneurs, particularly in growing ecosystems, i.e.in Kenya, Nigeria and South Africa. Under the GIZ and BMZ, the MakeIT Program was launched toprovide targeted support to technology entrepreneurs in Nigeria and Kenya to strengthen theirecosystems, expand their connections to business and opportunity, as well as improve their capacity tomanage growth and investment. Other Intensive training programs like the Tony Elumelu FoundationEntrepreneurship Program, have ambitious targets to support 10,000 entrepreneurs to create over 1million jobs, and add USD 10 billion in revenues to the African economy. Entrepreneurship networksacross the continent also provide opportunities for ecosystem development, capacity building andlarge-scale expertise and knowledge transfer. Ecosystems such as VC4Africa or the Global InnovationGathering connect entrepreneurs to each other, and growth opportunities to exchange ideas,collaborate and leverage the network of support to develop their enterprises. Several high profileexamples of effective personal development programs exist Success Management International (SMI)is one example of such a program based on the continent. The EEP will build on these initiatives, combining an innovative funding model that allows entrepreneursgreater flexibility, with targeted training and mentorship for enterprise development and growth.

1.4.2 Existing Non-Financial Programs

Many young people with good business ideas struggle to survive on a day-to-day basis. We propose theEntrepreneur Establishment Program (EEP) to alleviate this struggle by equipping these entrepreneurswith the knowledge and skills they need to grow a business and create jobs and also plugging theircapital requirements to finance the business.

2. The Entrepreneur Establishment Program

The Entrepreneur Establishment Program (EEP) is a standardized holistic tool that supportsentrepreneurs, financially and non-financially, in building their business by providing affordable andaccessible financing, entrepreneur training and personal development support, access to businessexperts and mentors and eventually creating an enabling and sustainable ecosystem. The main goal of the EEP is to provide micro and small to medium enterprises with support to ensurethat they are investor ready and are able to successfully de-risk their businesses and attract the righttypes of investors at the appropriate time. The key success indicator for the EEP is the creation ofsustainable employment and tailored solutions to developmental challenges in the continent of Africathrough building successful businesses. The financial support, in the form of a convertible loan, is provided to meet both operational costs andcapital expenses. The non-financial support will offer entrepreneurship training, covering technical skills(e.g. finance and financial reporting, marketing, business plan development etc.), personaldevelopment, mentorship and networking.

2.1 Overview

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The EEP can be implemented through an independent entity, the Entrepreneur Establishment Fund(EEF) (see chapter three). The EEF will be governed by the program terms and a board of advisorscomprising representatives from the AfDB, BMZ and other institutions that may enter the program plan.In order to preserve the spirit and intent of the EEP and should it be in line with the President’s view wewould also suggest a high-level advisory role for the YIWG during the implementation phase. The fundwill utilize appropriate technologies and innovative policies such as the blockchain to ensuretransparency and work with existing startup hubs, tertiary education institution incubators oraccelerators or impact investment funds, collectively termed the Enterprise Support Organizations(ESO). The ESOs’ responsibilities will be to facilitate the implementation of the financial and non-financial components of the program. Each ESO will be expected to apply to participate as an EEPimplementation partner and will be thoroughly vetted before being brought on board. Applicants must join the EEP through a startup hub, tertiary education institution incubator oraccelerator, impact investment fund (ESOs). The ESOs will do the first level evaluation to ensure thatthe candidates meet the criteria and requirements for the EEP. The ESOs themselves would also needto apply to participate in the EEP and will need to meet the requirements (which will be drafted inconsultation with key stakeholders). Each ESO will be assigned a mandate in line with their area ofexpertise and will be held accountable for the use of the funds availed in the pursuit and execution ofthe mandate assigned. To have alignment of interest, the ESO will be required to take a ~10%contribution to its assigned funds to absorb its fund management expenses. Once approved, the entrepreneur will be assigned a mentor and will be expected to work with ESOs,which have been approved to provide structured non-financial support for the EEP, throughout theduration of the funding period. Progress is measured through KPIs and reviewed by a reviewcommittee. All the successful beneficiaries of the EEP will be required to mentor incoming EEPprogram participants.

The EEP targets:

Businesses at different stages of development, i.e. ideation, pilot, pivot orgrowth, which are yet to raise their Series A. While we support micro and smallbusinesses, we are looking for businesses that have the potential to grow andoffer decent employment to employees.Each business will receive financial and non-financial resources sufficient for itsneeds, but all the businesses will use the same standardized application form. Theticket sizes will be grouped to facilitate ease of application processing.

Businesses that clearly contribute to the achievement of the SDGs or the High 5s.

Any male and/or female entrepreneur who is a citizen of any African country or ofAfrican heritage in the first generation or second-generation foreign citizenshipwith a business that mainly operates in Africa. The Program aims to provide equalopportunity to all the potential participants regardless of gender and age, and thestatistics will be tracked within the different categories of the beneficiaries.Allocation of funds within the program will be further designed to focus on groupsthat are in need of more support for example women and youths.

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The financial support of the EEP is a convertible loan administered by a broad range of conventionaland non-conventional local finance institutions (i.e. incubators, accelerators, impact investment fundsetc. and paid through banks, mobile money etc., as is relevant) on behalf of the EEF. Financial ESOs willassign their internal fund managers to monitor the financial performance of the business and advise asneeded. The entrepreneurs receive the convertible loan over an initial period of 12 months to assist withthe financing of operating and capital expenses of the entrepreneurs’ business.

2.2 Financial Support

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Potentially lower returns: In line with the lower risk borne by the investors, convertible notes may comewith lower returns than equity. This is because the valuation will be done after the funds have been investedand the valuation is therefore based on some of the returns of the investment. Convertible notes will suitinvestors who are not only looking at maximizing their financial returns, but are also invested in the generalsuccess of the company for other socio-economic reasons.

iWhat is a convertible loan and how does it work?

A convertible loan is a loan that can be converted to a predetermined number of equity shares under predeterminedterms and conditions. In essence, a convertible loan can be referred to as a hybrid of debt and equity. Conversion toequity will depend on the terms outlined in the convertible loan. Some have an automatic conversion triggered bythe achievement of an agreed milestone, e.g., a funding round; whereas others have an option to convert whichmeans the loan can remain a loan and be repaid or can be converted to equity at the option of either the investor orthe investee.

Convertible loans were first introduced in the 1800s to address financing for low rated companies or high growthpotential companies and strongly resurfaced in the late 1990s and early 2000s with the growth of the start-upscene, where startups were considered high growth potential companies. The main attraction to convertible loansin these cases was their ability to defer the valuation of the company and the allocation of shares. Underconvertible loans, the valuation happens at a future date and not at the time of investment, which provides time forthe companies to stabilize and establish basis for valuation.

Increased accessibility: As much as this is a loan, investees will not need to provide collateral security,which most founders may not have at the time they are seeking investment. Without the need forrepayments as mentioned in point 4 and the collateral, convertible notes make financing more accessibleto companies that are just starting out.

Simplicity: the process of issuing convertible loans is fast and affordable. For as long as the investoragrees to the proposed terms and conditions of the note, the loan can be issued within a week, withminimum legal fees.

Avoid over-dilution on the part of the investee/founder: the delay in valuation allows sufficient time for theestablishment of the worth of the shares, and protects the entrepreneur from over selling their shares.

Reduces the risk exposure for the investor, compared to ordinary stock shares: due to the nature of theconvertible loans, in the event of liquidation, convertible loan holders have access to the company’s assetsbefore the ordinary shareholders. In addition, where the option to convert exists, the investor can opt tokeep the loan as a repayable loan and still get their money back in a way that ordinary shareholders areunable to.

Minimum cash flow implications for the investee: other than the cash that comes into the company at thetime of investment, there are no other cash payments in or out of the business that will be associated withthis transaction, unless the loan is not converted into equity. This means that investees need not worryabout getting enough cash to make regular repayments whether for capital or interest. Both interest andcapital will be converted to equity under the defined terms. In the event that the loan is not converted,repayments will only happen after a predetermined date or event.

Disadvantages

Advantages

History

Definition

It can get complicated: The convertible loan structure is flexible, which gives room for customizedstructuring but also dispute. It is important to ensure that the loan agreement clearly specify the termsincluding capping the value of the company both upper and lower range, on which the share allocation willbe based, to avoid disputes.

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Each entrepreneur will be required to apply for financial resources to cater for an initial 12-monthperiod. The application is made and approved once every 12 months and disbursed quarterly in theinitial years. The frequency of the review process is eventually reduced in line with an increased rapportwith the entrepreneur and business and establishment of their track record of reliability andconsistency. The disbursement of funds will depend on the achievement of the KPIs set by the reviewcommittee for the entrepreneur and the business. At the end of each 12-month period, the entrepreneurwill have the opportunity to enter another round of the program with a renewed set of KPIs, in line withthe development of the business and the entrepreneur. Each entrepreneur has a maximum of a singleentry into the Program and special cases would be considered as and when they arise. This is tosafeguard the fund from being abused. Interested candidates will apply for the EEP using a standardized application form. The standardizedform will cater to both the financial and non-financial support for all applicants regardless of age,gender or ticket size. The evaluation process for each application will entail a rigorous analysis of thebusiness conducted by the ESOs.

2.2.1 Application and Disbursement

Knowledge gaps and next steps: The following are points to further develop as we design a moredetailed project document.

Identify suitable finance institutions

Develop application form and on-boarding process for the ESOs

Develop application form and on-boarding process for the entrepreneurs

While the convertible loan will be the standard fund instrument across the EEP, the design of eachconvertible loan agreement will be defined by the amount of money involved. The funds will be dividedinto three broad tickets:

2.2.2 Convertible Loan Ticket Sizes

USD 0 - USD 50,000

The tickets will then be used to allocate the funds, with higher priority assigned to businesses underticket sizes 1 and 2. However, companies under ticket size 3, which have been in the program for ticketsizes 1 and 2, will also be prioritized. Each ticket size will have a standardized convertible loan terms toensure that the process is simplified. Any investments above USD 1,000,000 will be forwarded to otherrelevant investment bodies which take on higher investments.

USD 50,001 - USD 500,000

USD 500,001 - USD 1,000,000

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Details of loan agreements

How fund requirement for each business is determined

Classify which expenses will be CAPEX and which will be OPEX

The convertible loan will be provided to cater for both operating and capital expenses. Operatingexpense funds (OPEX) can be disbursed immediately after the approval on a quarterly basis. Capitalexpenditure (CAPEX) funds will only be disbursed after the initial six months of the Program oncetraction of the business has been established and will also be disbursed quarterly. The conversion to equity will happen when the business has a market value on which the calculation ofthe equity can be based. The target is for the conversion to happen at Series A, or at the point where thebusiness can attract bigger investors. Once converted to equity, the shares can be sold to the newinvestors and the invested funds plus a profit or loss recouped by the EEF.

Proportion of funds to be disbursed across the different ticket sizes

To achieve the full potential of the fund, we need to ensure that the EEP non-financial support matchesthe diverse needs of entrepreneurs. The key principle that has been factored into the design of the non-financial support is to keep the program lean and build on existing quality resources. A significantamount of content already exists in the area of non-financial support for entrepreneurs. This support isscattered, at times hard to find and varies widely in quality from excellent to mediocre to ineffective andmisleading. Leveraging the good quality resources that already exist and making them easier to identifyand access will keep our Program efficient and effective. The Program assessment will focus onmonitoring the quality and impact of these tools. The non-financial support consists of two key components: capacity development A and capacitydevelopment B. Capacity development A focuses on human interaction and exchange while B focuseson the provision of tools, trainings and events.

2.3 Non-Financial Support

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Capacity development A has 3 sub-components that focus on human interaction - the long-termrelationship with mentor, the short-term engagement of an expert on a specific issue and ad hocexchange amongst peers. They are explained in detail below:

2.3.1 Capacity Development A

There are two key reasons for including a mentoring component. The first being,entrepreneurs with good mentoring support are more likely to succeed. While in a differentcontext, surveys in the US show that as much as 70% of small businesses that receivementoring survive more than five years – double the survival rate of non-mentoredbusinesses. Many successful entrepreneurs too have spoken about the importance ofmentoring in shaping their success. The second reason is the criticality of the KPIs for thefinancial support in the EEP. The involvement of mentors will enable them to offer clearinsights into the performance of the entrepreneur/business and participate moreeffectively in the review process.

i) Mentoring

The EEP will provide every participant with a mentor who will advise and guide theparticipant throughout his/her journey. The mentor is someone willing and able to spendhis/her time and expertise to guide the development of another person on a voluntarybasis. Ultimately, their role is to help the mentee set and meet their goals. He/she canshare information about his/her own career path, as well as provide guidance, motivation,emotional support, role modeling and access to his/her network.

The following points describe key elements of how the mentoring program will work:

The mentor pool will be developed in two ways. Firstly, it will tap into existingmentoring networks and secondly, there will be a relay mentoring system in place,where every participant who has successfully completed the program will beexpected to also give back by being the mentor to a participant in the next cohortof the program. All mentors would have received training on how to be a goodmentor before they commence the role of a Mentor.

Tools and templates will be provided for the mentors and mentees to help ensurethat they are able to maximize the potential of the relationship e.g. templates forthe agreements detailing roles and responsibilities, how to structure meetings,suggestions on what to ask your mentor etc. These tools will be developed withthe support of a well-established and successful mentoring organization.

On-boarding will be part of the participants’ orientation process. Each party will beintimated of their roles and expectations through a fixed agreement to avoid amismatch of expectations. The agreement will clearly outline the frequency, venueand priority areas of their meetings going forward.

Matching entrepreneurs to mentors will be done with a system that utilizes bothartificial intelligence and human inputs to ensure an efficient and effectiveprocess. While the exact criteria and preferences for matching will need to bedefined, they could include elements such as the entrepreneur’s self-identifiedneeds, geographic proximity, gender, industry etc.

What

Why

How

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Quality assurance will be an integral part of the EEP platform. A central repositoryof all mentors and a corresponding rating by their mentees will be maintained. Allmentees must rate their mentors at the end of each year and both mentors andmentees can flag issues at any point throughout the program. These ratings,which will be made available to EEP program administrators, will be a pivotalplatform for entrepreneurs to flag issues and also for the matching system to bestcapture the strengths and weaknesses of the mentors in the future.

Regular meetings will be held between the mentor and mentee, these shouldideally be done in person. The mentor and mentee may decide to meet morefrequently but a minimum number and length of meetings will be a requirementset by the EEP e.g. one 90-minute meeting a month. This requirement will be setbasis a consultation with existing mentoring programs.


Define roles and responsibilities of mentors and mentees

Define selection criteria and engagement terms for mentors

Define matching criteria

Examples of AI systems for matchmaking

Identify mentoring networks to partner with in target countries

Design the relay mentoring component

Clarify how the rating system would work

All entrepreneurs face a series of knowledge gaps as they develop their businesses.Although they can easily resolve some of their challenges using their networks, onlineresearch, mentor guidance etc., there are other problems that require a specific know-howthat they cannot afford and/or access. Their ability to resolve these knowledge gapseffectively and affordably could be a make-or-break factor for their business. The expertsupport will address these situations.

ii) Expert Pool

The expert pool (individuals/ institutions) will provide short-term, specific expertise on aconcrete business challenge that the entrepreneur is facing and that requires some type oftechnical knowhow-, e.g. legal issues, the inclusion of a specific technology into a businessmodel, etc. Unlike the mentors, the experts will be remunerated for the support they provideto entrepreneurs. There will be a database of experts on the EEP platform thatentrepreneurs can tap into for free or at a marginal rate.

Why

What

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A database of experts will be available on the EEP platform. This database willshowcase experts from around the world in a user-friendly, searchable format.The entrepreneurs will see the profile of the expert, the cost, if any, to them, theratings and reviews of other entrepreneurs. The EEP will build up this database bytapping into an existing range of programs that already provide such support, i.e.corporate volunteer programs. The AfDB, through the JfYA is working to mapcorporate volunteer programs and this can provide the basis for the expertdatabase. The mentors and participants could also be part or the expert databaseif they have relevant skills that meet the selection criteria.

A range of compensation options will be available for entrepreneurs to accessexperts:

Quality Assurance: The expert database on the EEP platform will include ratingsand reviews of all the experts. With time, this will assist entrepreneurs to assesstheir fit with the experts and incentivizes the experts to provide the entrepreneurswith a sustainable solution for their identified issues.

Free - Some experts will be for free; these will include volunteers fromcorporate volunteer program or other expert programs such as SeniorExpert Service (SES) [22].EEP points system - Some participants may be able to serve as experts. TheEEP can create a points system amongst entrepreneurs where they can getexpert points when they offer their expertise to a fellow participant. Withthese points, they too can get expert support from other experts in the EEPexpert database.Virtual shares - Some experts may choose to take on a longer-termengagement with a small stake in return, for example 1% equity.


Design how the expert database should look and the required functionality

Identify programs where we can source experts

Define selection criteria for experts

Clarify how the points system and virtual shares would work

How

Why

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The participants are a valuable resource for one another. Hence, it becomes imperative tofacilitate peer-to-peer exchange in ways that are mutually beneficial without overburdeningthe participants or drawing away from their key focus which is their business. The EEPseeks to achieve this through a simplified process that allows entrepreneurs to exchangeideas and insights through existing online and offline systems.

iii) Peer-to-Peer Support

There are 2 levels of peer-to-peer exchange in the EEP. At the wider program level,participants will meet and have networking opportunities at onboarding and showcasingevents of the EEP. Alongside these face-to-face interactions, the EEP will also create onlinenetworking spaces e.g. a LinkedIn group for all participants with a moderator to facilitateexchange. Reinforcing this, smaller groups of entrepreneurs (of about 10 participants) willbe clubbed as a peer network. These groups can serve as an effective, convenient andquick access support system through regular meets or WhatsApp exchanges.


Large group interactions:

Small group interactions: Smaller, semi-formal groups could be set up to providecloser support amongst entrepreneurs in complementary or different areas. Theycan meet up regularly and have a WhatsApp group for exchange. These groupsare semi-formal, and it is up to the groups to decide how to make them beneficialfor themselves.

Online - Every EEP entrepreneur will have a short profile on the EEPplatform. This makes it easier for entrepreneurs to know who is in theirnetworks. They will also have an EEP entrepreneurs’ online group e.g. onLinkedIn, where they can continue to exchange or interact as a group orbilaterally.Offline – At the beginning of every intake phase of the EEP cycle there willbe an onboarding event that will bring together all the EEP entrepreneurs ina specific


Further clarify the larger and small group interactions

Identify relevant best practices

Mapping out existing platforms that can be leveraged

What

How

Why

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Capacity development B has 3 sub-components that focus on the provision of tools, trainings andevents. They are explained in detail below:

2.3.2 Capacity Development B

There is already a plethora of online and offline tools to help entrepreneurs to establish andimprove their business. These include various training programs, guides, books, videos etc.As the saying goes, people are drowning in information, but starving for knowledge. TheEEP wants to focus on business tools and training components that makes it easier forentrepreneurs to find the knowledge they need and to help ensure that it is impactful.

i) Business Tools and Trainings

The EEP platform will showcase a repository of business tools and training programs thatis user friendly, intuitive, searchable with helpful filters, reviews and ratings. One could thinkof it as a Yelp for business tools [23]. In addition to this repository, the EEP can alsodevelop customized material where clear gaps are identified or to help contextualizeparticularly valuable tools. There will be a set of mandatory courses for the entrepreneursand other optional courses, which will complement the skills that the entrepreneurs andtheir teams possess. All these trainings will be listed in the repository.

The following points describe key elements of how this sub component will work.

Contextualizing tools and frameworks: There are many tools that entrepreneursare finding to be very useful but, in many cases, these are made for entrepreneursfrom very different geographic contexts to those of the EEP entrepreneurs. Forexample, many useful tools are American, they target American entrepreneurs andgive case studies from America. Contextualizing and translating tools into variousAfrican contexts can make these tools even more useful.

Customized resources: Where a clear gap is identified and a strong case fordemand is established the EEP can also develop its own tools. This however willlikely be a very small number of tools.


Identify existing repositories of tools

Further develop list of types of tools needed in participation with African entrepreneurs

Define design requirements for the database and required functionality

Identify Partners and co-define method to contextualize select tools

What

How

Why

What

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ii) Personal Development

The EEP will develop effective methods to help build awareness on the power of a growthmindset and cost-effective training courses that teach entrepreneurs how to make thatshift. This shift will enable them to set goals, achieve them and become agents of changethrough their businesses. This may be done through an online course with offlineinteractions to keep students motivated. In addition, the EEP will find ways to not onlyshowcase success, but to also unpack it and make it easier to replicate the stepssuccessful people took to becoming successful. Additionally, the EEP will allow forentrepreneurs within the network to exchange and discuss inspirational media geared topersonal growth and development.


Personal growth and development courses: Although there are some readilyavailable, successful courses used by large companies, they are priced quite high.The EEP would explore with companies that provide these highly successfulprograms how their courses can be tailored to a wider audience and be mademore cost-effective. One option could be through online courses combined with inperson interactions. The offline interactions provide accountability so that theparticipants actually complete the courses because they have to report back totheir group.

Showcasing and unpacking success: There are many inspirational online stories ofentrepreneurs overcoming challenges. However, there is not much opportunity foryoung entrepreneurs to interact with these stories. The EEP will organize face-to-face, virtual meetings and master classes with top successful entrepreneurs toturn case studies into real-life exchanges. This will give participants theopportunity to ask personal and in-depth questions relating to their own personalexperiences.

Business leaders around the world acknowledge that the entrepreneur and his/her teamare a critical driver of success for a company. It is becoming increasingly clear that thecritical factor here is not people’s experiences or level of intelligence alone, but also theirmindset. Mindset is the established set of attitudes held by someone. Stanford Universitypsychologist Carol Dweck made the distinction of a growth mindset vs. a fixed mindset. Ina fixed mindset, people believe their basic qualities, like their intelligence or talent, aresimply fixed traits. They spend their time documenting their intelligence or talent instead ofdeveloping them. They also believe that mostly talent and luck create success – effort haslesser role. Real world observation shows this in incorrect. In a growth mindset, peoplebelieve that their most basic abilities can be developed through dedication and hard work –brains and talent are just the starting point. This view creates a love for learning and aresilience that is essential for great accomplishment. By enabling entrepreneurs to shift orfurther develop a growth mindset, the EEP can help unleash their full potential. With thefast-paced and growth-oriented culture of entrepreneurship, people can forget to take careof their own personal well-being. Research indicates a high level of mental health issues forentrepreneurs and that loss of focus, loss of passion, or experiencing burnout on the partof founders often leads to startup collapse.

How

Why

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Customized resources: Virtual book clubs will allow program participants to shareand discuss inspirational books, films or other forms of media that have impactedtheir outlook and development. These e-clubs allow different people torecommend different books and topics so that individuals can be exposed totopics that they may not have previously been aware of. The exchange will alsoallow the participants to interact in a deeper and more personalized way with thetexts through discussion.


Identify high-quality online personal development courses

Identify examples of virtual book clubs

Building network of leading African entrepreneurs

The ability to access valuable networks and to convert contacts into value is critical to thesuccess of entrepreneurs. Research suggests that effective networking can be animportant driver for growth. Many EEP participants may lack access to valuable networksespecially as they are young entrepreneurs, some of whom will come from disadvantagedbackgrounds.

iii) Networking

The EEP can grow participant networks through the development of strategic events andtraining entrepreneurs on how to network and turn their contacts into value.


Strategic events: Many events are poorly designed; they tend to offer justinformation and discussion and are not sufficiently focused on action. The EEPwill develop a series of action-oriented events that will be designed to achievespecific tangible outcomes. This network series will be developed following aneeds assessment of participants. Events may target all participants or specificparticipants, e.g. specific industry, location, stage of growth.

Nurture relationships: The participants will receive training or tools on how to getthe most out of networking including everything from how to present themselvesto different audiences and how to have an effective follow up system, videos onbest and worst practice.

What

How

18


Identify list of case studies and best practice for action-oriented events

Identify trainings and tools on converting contacts into value

Mapping events in target countries that can be leveraged for networking purposes

Key Performance Indicators (“KPIs”) will be defined for each entrepreneur and their business. TheseKPIs will the basis for the evaluation of the performance of the entrepreneur and their business. KPIswill include business KPIs as well as indicators for the entrepreneur’s progress in the capacity buildingpart of the program. The entrepreneur’s progress is reviewed on a quarterly basis. Where the entrepreneur fails to meet theKPIs, or is found to be abusing funds, the support, both financial and non-financial, will be immediatelyterminated. Every year, when the entrepreneurs apply for the next round of funding, a furtherassessment of their business, the entrepreneur and the progress made to date will be reviewed in moredetail. Review and assessment will be done by a review committee. Based on the review, the convertible loan can be terminated on a quarterly basis, if the entrepreneurdoes not actively participate in the EEP. If the entrepreneur is found to be abusing the funds provided,the entrepreneur will be required to pay back the funds received with interest. The interest charged inthis case is yet to be determined.

2.4 Review and Evaluation


Who defines the KPIs

Which KPIs are fixed for all entrepreneurs and which are flexible

Composition of review committee

Penalty for/treatment of non-performance of KPIs

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As mentioned in section 2.1, the, EEP will be implemented through an independent entity, theEntrepreneur Establishment Fund [24], “EEF”, which will be a finance institution.

3. Finance mechanism: The Entrepreneur Establishment Fund

The EEP requires the collaboration and participation of a diverse range of stakeholders to provide thecomprehensive financial and non-financial support outlined in the proposal. To ensure that thesevarious actors work together efficiently and effectively we propose the structure [25] below for the EEFpilot. The EEF can then evolve into the stand-alone fund after proof of concept.

3.1 Proposed Structure of the EEF

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Funds to finance the EEP will be raised from a pool of different players through the EEF.State/Governmental institutions, e.g. BMZ and other identified philanthropic donors, will form the basisof the pool and/or de-risk the portfolio to encourage other Development Finance Institutions (DFIs) e.g.AfDB, KfW and other investors to participate. The goal is to attract all types of investors and funders,including private investors.

3.1.1 Pool of Investors and Philanthropists

The EEF will raise blended finance for the implementation of the EEP, where some of the funds will begrants/donations and the other component will be entirely investible funds. At an initial stage, grantsand donations will be used to fund the management of the fund as well as the implementation of thenon-financial support aspect of the EEP. The investible funds will all be invested in the financialcomponent of the EEP, with the full amount being invested into the entrepreneurs and their businesses,through convertible loans. The blended finance approach will allow the EEF to track the costs ofmanaging the program and setting it up as well as the costs of capacity building and the cost ofinvestment. In the long run, this tracking will inform the management of the entire portfolio and formthe basis of an effective monitoring and evaluation process. The EEF proposes to have three types of investors:

3.1.2 Blended Finance Approach

The precise structure of the EEF and loss absorption share of the different investor categories is to befurther developed in consultations with stakeholders.

The EEF will be powered through core technologies such as the blockchain, which will be operatedunder the leadership of a group. This type of blockchain is termed a Federated/Consortium blockchain.Blockchain technology is a mechanism for using multiple points in a network to act as independentverifiers of all information. Instead of having a central body (like a Standards authority or Regulator)enforcing the rules to decide whether a certain kind of data or transaction is valid, each point or link inthe blockchain will be empowered to validate the transaction. The blockchain technology will issuesmart contracts for the funds raised and further log all transactions and investments pertaining to theEEF. To further ascertain transparency and efficiency across the process, the database or ledger ineach blockchain will be configured to trigger specific actions in response to events observed at anygiven link.

3.1.3 Proposed Underlying Technology

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Vis-a-vis public blockchains, the Federated/Consortium blockchains allow only key stakeholders, withaccess rights, to participate in the process of verifying transactions. Each key stakeholder will holdtheir own copy of the master database or ledger, tracing all transactions the blockchain has been put inplace to facilitate. Federated blockchains are faster, easily scalable and provide more transactionprivacy as the consensus process is controlled by a pre-selected set of nodes; e.g., a consortium of 15key stakeholders each of whom operate a node, of which 7/8 must sign any block for the block to bevalid. Furthermore, there will a provision of right to read the blockchain restricted to select participantssuch as ESOs and policy makers. Each time an interaction/transaction occurs between two points on the chain, a unique “block” iscreated, which is assigned a unique digital signature associated with its own private and publicencryption keys. To begin a transaction (such as a payment or money transfer), the system generates aprivate key for it, which is then checked by every other node of the blockchain to verify that itcorresponds to the public key also associated with that transaction. The digital signature created isunique to each transaction and is encrypted. Every other node on the blockchain can refer to its copy ofthe ledger to verify if the signature and keys being used are valid – and authenticate or reject atransaction accordingly on that basis. Blockchain can deliver a multi-party database with easy to access and impossible to tamper features tosafeguard such data in digital formats. Choosing this type of technology reduces transaction costs anddata redundancies and replaces legacy systems, simplifying document handling and getting rid of semimanual compliance mechanisms.

The EEP will leverage service providers that havethe appropriate skills and operations in the market,thereby strengthening the entrepreneur ecosystem.The service providers will range from mentors andcoaching, training program providers to incubators,accelerators and investment funds [26]. For the non-financial aspects, the EEF will contractout different service providers who will besufficiently trained to implement and execute theEEP. More is discussed in the non-financial section

3.1.4 Engagement of Multiple Service Providers

(2.3) of the proposal. For the financial aspects, investments will be made on behalf of the EEF by theESOs. The convertible loan will be owned by and liquidated on behalf of the EEF. The managinginstitutions will get a management fee and will adopt the EEP as part of their own operations.

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The expenses to be associated with EEP are broadly classified into two; portfolio expenses andportfolio management expenses, where EEF is the portfolio.

3.2 Potential costs of the EEP

Portfolio expenses consist of the losses made from making the investment in the first place i.e. incases where the entrepreneur does not succeed, the EEF will have to write-off this loss and will not getany return from the investment already made in the entrepreneur and his/her business. Theentrepreneur may fail to succeed due to many reasons broadly classified between:

3.2.1 Portfolio Expenses

Self-sabotage, where the entrepreneur is unwilling to collaborate and follow instructions andconsequently fails to meet set milestones and KPIs. Under EEP, this would warranttermination of funding. The entrepreneur will be expected to pay back this amount however,in cases where the entrepreneur fails to repay, the loss would be borne by the fund.General business failure, where the business model fails to gain traction at some point,regardless of all the efforts made to help it succeed.

Portfolio expenses can be managed by ensuring a thoroughrecruitment process and providing the entrepreneurs with all thesupport they need for the business to succeed. However, becausethis program is designed to reach as many qualified entrepreneursas possible and the process is intended to be standardized with alow turnaround time, the inherent risk of setting up such a portfoliocannot be fully mitigated. Experience from venture capital and impact investment funds showthat the process of recruitment and business support will self-improve and reduce the portfolio costs over time. That said, it isexpected that these losses will be high in the first years and can becompensated for by the returns from the successful investments inthe later years. The first loss and second loss structure of theprogram will ensure that the program is de-risked, and that any lossif incurred is distributed across different stakeholders.

Portfolio management expenses consist of all other expenses associated with making the investmentand managing it. This includes:

3.2.2 Portfolio Management Expenses [27]

Experts, which include fund managers, mentors, hubs, advisors, consultants, etc.Set-up costs, which include training of the different stakeholders in their roles and thepurpose of the fund, training materials for the entrepreneurs, etc.Research, which is required to further design of the program and consistent iterationsTransaction costs, which include exchange rate losses, bank transfer costs, managementfees, legal fees

Photo Credit: pulse.com.gh

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All the costs mentioned above are overheads, and do not have a direct financial benefit for the fund butare necessary to ensure that the fund is successful. These expenses, initially, will be paidfrom the grants contributed from the different donors as mentioned in section 3.1. For the fund to take off and make significant progress, the fund will require a significant initialinvestment that may need to be allocated to cater for the above fund expenses for at least 5 yearsbefore any returns can be achieved. There is a chance that the fund will start getting returns fromsome investments within the 5 years, but this may not be sufficient to meet the fund expenses at thispoint. Additional investment in the fund may be required post the 5-year mark, depending on how thefund is doing. Specific amounts and permutations of how it can be invested will be calculated at a laterstage of this project.

Reasonable funding needs for each entrepreneur and business will be determined by country andsector. For each country/sector, an assessment will be done of the startup- costs, human resourceexpenses and other operating expenses to establish the minimum funds required by startups- at thedifferent stages of the company growth. In addition to this, there will be need to evaluate theentrepreneur ecosystem within each target country to establish the amount of support that theecosystem will require to implement and sustain the EEP. With this knowledge, and a target number ofentrepreneur reach, the necessary funding pool can be established per country per annum.

3.3 How funding needs are determined

Levels of unemploymentPolitical governance statusEconomic statusDemographic and market sizeMaturity of entrepreneurial ecosystemSynergies with the existing stakeholders’priorities and their investment in the saidcountry

The central design of the program can be the same for allcountries, but within each country, there is need for furtherdesign to meet to demands of that operating environment.It is recommended to do a pilot in one country. Thecountry for the pilot is yet to be identified.

It is highly recommended that the fund be launched in aselect number of countries on the continent, to run as apilot and assess on the ground practicability. The choiceof countries could be influenced by select factors, whichinclude:

Photo Credit: Global Trade Review

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Below is a summary of the process for the EEF:

4. The Process: From Inception to Launch

Inception:

Concept Development:

Stakeholder engagement:

Official presentation

Further development:

Representation & Stakeholder Engagement at the AIF

Pilot Project developed:

Pilot launch:

Review of Pilot:

Gradual roll-out

The YIWG was requested to come up with the concept of a solution which the AfDB and partners likethe BMZ and GIZ can then take on, further co-create and develop and ultimately implement. Going forward, the program will need to be adopted by experts in finance and capacity building and willrequire solid financing and structuring. The core team is now engaging different key stakeholders indiscussions to evaluate their interest and commitment to the different roles defined in this proposal.Multiple stakeholder discussions will be held in the next couple of weeks to ensure that the programgets the appropriate support and commitment. The YIWG will be present at the Africa Investment Forum (AIF) in Johannesburg, South Africa inNovember 2018 to further engage stakeholders and evaluate the interest from the market. The detailsof the presentation and the nature of the engagement at this event are still being evaluated anddiscussed. The goal is for the proposal to gain support and commitment and once fully developed as acomprehensive program, be approved to an implementable project for 2019.

4

5

6

7

8

9

10

Meeting with the President Adesina June 2018 (Lead by BMZ and AfDB

Co-creative, participatory concept development (Lead by YIWG)

Discussions with potential partners (Lead by YIWG)

of the concept to President Adesina 29 October 2018 (Lead by YIWG)

Official acceptance of the concept and further development of the idea by AfDB and partnersincluding BMZ, GIZ and others) (Lead by AfDB and supported by YIWG and interestedpartners)

in South Africa, 7-9 November 2018 (Lead by AfDB and supported by YIWG )

Full project document for a pilot round developed (Lead by AfDB and relevant partners)

Launch of the pilot in ideally in 2019 (Lead by EEP implementation team /AfDB and partners)

Thorough analysis of success metrics and incorporation of changes to the EEP frameworkas required

across the continent

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Notes

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References[1] By 2030, Africa’s young population is expected to grow to 375 million and an estimated 29 million job seekers are expected to enter the continent’s labor market each year. African Development Bank, Organisation for Economic Co-operation and Development, United Nations Development Programme (2017). ‘African Economic Outlook 2017’. Retrieved on September 5th 2017 from: https://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/AEO_2017_Report_Full_English.pdf [2] In 2017, over 290.6 million African were less likely to be employed in formal, stable working conditions, with access to social security, or job security, while another 37.8 million were without employment of any kind. International Labour Organisation (2018). ‘International Employment and Social Outlook: Trends 2018.’ Retrieved 5 September 2018 from: https://www.ilo.org/global/research/global-reports/weso/2018/WCMS_615594/lang--en/index.htm [3] International Labour Organisation (2018). ‘International Employment and Social Outlook: Trends 2018.’ Retrieved 5 September 2018 from: https://www.ilo.org/global/research/global-reports/weso/2018/WCMS_615594/lang--en/index.htm [4] International Labour Organisation (2015) “Five Facts about informal economy in Africa” Retrieved 17 October 2018 from: http://www.ilo.org/addisababa/whats-new/WCMS_377286/lang--en/index.htm [5] 22% of young Africans in 2017. African Development Bank, Organisation for Economic Co-operation and Development, United Nations Development Programme (2017). ‘African Economic Outlook 2017’. Retrieved on September 5th 2017 from: https://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/AEO_2017_Report_Full_English.pdf [6] International Labour Organisation (2018). ‘World Employment and Social Outlook – Trends 2018’ Retrieved 17 October 2018 from: https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/documents/publication/wcms_615594.pdf [7] Beck, T. & Cull, R. (2014). SME Finance in Africa. Journal of African Economies, 23(5), pp. 583-613. doi: 10.1093/jae/eju016. Retrieved on 5 September 2018 from: http://openaccess.city.ac.uk/13174/1/SME%20Finance%20in%20Africa%20-%20May2014.pdf [8] AVCA (2017), 2016 Annual African Private Equity Data Tracker [9] International Finance Corporation (2018). ‘SME initiatives’. Retrieved on September 5th 2018 from: https://www.ifc.org/wps/wcm/connect/REGION__EXT_Content/Regions/Sub-Saharan+Africa/Advisory+Services/SustainableBusiness/SME_Initiatives/ [10] Beck, T. & Cull, R. (2014). SME Finance in Africa. Journal of African Economies, 23(5), pp. 583-613. doi: 10.1093/jae/eju016. Retrieved on 5 September 2018 from: http://openaccess.city.ac.uk/13174/1/SME%20Finance%20in%20Africa%20-%20May2014.pdf [11] In 2012 only 28% of universities or technical institutions had developed entrepreneurship training for students and only 10% offered innovation courses. Dr. Jean Kobongo, ‘The Status of Entrepreneurship Education in Colleges and Universities in Sub-Saharan Africa,’ Millersville University, 2010. [12] There is significant variation among countries e.g. Eritrea takes the longest time for business registration (84 days), while Rwanda and Burundi have a 4 day process for business registration. The average is 24 days. [13] There is significant variation among countries e.g. South Sudan’s business registration process has the highest prohibitive cost at 305% as a percentage of income per capita, while South Africa’s costs are low at 0.2% as a percentage of income per capita. The average is 49.9 % as a percentage of per capita income. [14] UN Sustainable Development Goals. Retrieved on 20 October 2018 from: https://www.un.org/sustainabledevelopment/sustainable-development-goals/ [15] UN Sustainable Development Goals. Retrieved on 20 October 2018 from: https://www.un.org/sustainabledevelopment/sustainable-development-goals/

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[16] The African Development Bank High 5s. Retrieved on 20 October 2018 from: https://sustainabledevelopment.un.org/sdg8https://www.afdb.org/en/news-and-events/african-development-bank-accelerates-pace-with-high-5-priorities-15879/ [17] Communication from the European Commission to the European Parliament, the European Council And the Council. Retrieved on 15 October 2018 from: https://ec.europa.eu/commission/sites/beta-political/files/soteu2018-africa-europe-jobs-alliance-communication-643_en.pdf [18] African Development Bank Group. Jobs for Youth in Africa. Retrieved on 18 September 2018 from: https://www.afdb.org/en/topics-and-sectors/initiatives-partnerships/jobs-for-youth-in-africa/ [19] African Development Bank Group. Affirmative Finance Action for Women in Africa. Retrieved on 11 October 2018 from: https://www.afdb.org/en/news-and-events/the-african-development-bank-is-delivering-for-africa-adesina-16937/ [20] African Development Bank (2018). Retrieved on 11 September 2018 from: https://www.afdb.org/en/topics-and-sectors/initiatives-partnerships/jobs-for-youth-in-africa/the-youth-entrepreneurship-and-innovation-multi-donor-trust-fund/ [21] African Development Bank (2018). Retrieved on 11 September 2018 from:https://www.afdb.org/en/topics-and-sectors/initiatives-partnerships/boost-africa-empowering-young-african-entrepreneurs/ [22] http://www.ses-bonn.de/ [23] http://www.yelp.com [24] The difference between the EEP and the EEF is that the EEP is the program proposal, the EEF is the fund that would be developed to implement this project. [25] The above proposed structure is not final and continues to be reviewed. The examples of stakeholders used are not final or all inclusive. We expect to have more stakeholders engaging in the program. [26] The potential role of banks is to be further discussed. Experts in the working group and workshops pointed out that banks currently do not have the appropriate structures and knowledge to execute the EEP. However, it would be beneficial to strengthen their capacity by training them to be able to join this program. [27] Only relevant if fund are externally managed.

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Annex 1: List of Stakeholders engagedThis proposal was developed through a participatory approach that involved a series of workshops andmeetings where a wide range of partners were invited to provide feedback and help shape the concept Below are lists of the partners we engaged in the process. At this point, we would like to expresssincere gratitude for the valuable input we received from each and everyone. Only through the diversefeedback from within this bigger network, we could ensure that the EEP is tangible and focuses on thereal problems.

Participants of the June-Meeting with Dr. Adesina & Contributors

First Name OrganizationSurname

Bangura

Berkowitz

Acquah

Biermann

Camara

Bessau

Döbler

Dufresne

Cissé

Giles

Godskesen

Gerritzen

Kebir

Maistry

Jacobson

Moune

Ndlovu

Motsi

Owoyele

Odhiambo

Alhaji Allie

Melissa

Manny

Niels

Khadi

Dirk

Florian

Bethany

Sannssi

Thierry

Stefan

Nana

Noara

Mervyn

Jeff

Maithy

Matida

Wadzanai

Obadamilola

Steve

ADAN

Afrolynk

ABAWT

Strategische Partnerschaft Digitales Afrika, GIZ

Afrika-Verein der deutschen Wirtschaft

KIC InnoEnergy

GIZ GmbH

Ada

Afrika-Verein der deutschen Wirtschaft

Supernow

startup mentoring

Magazin des Afrika-Vereins

Solshare

Konfid.io

Future of Ghana e.V.

BEAM Holding

ESMT Mandela Fellow

The African Democracy Experiment

Afrolynk

ukowapi

Möbius Matthias StartHub Africa

Borkowski Lukas Viamo

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First Name OrganizationSurname

Sharma

Stähler

Peire

Von Medem

Wanjala

Thierry

Yong

Zielmann

Wenzelmann

Acquah

Beckermann

Lindel

Rudolph

Donath

Sewing

Schenk-Dornbusch

KohlmeyerOyewusi

Adesina

Arun

Oladunni

Eduardo

Saliha

George

Samira

Erick

Kathleen

Victoria

Moses

Andreas

Julia Adriana

Alexandra

Andrea

Philipp

Sigrid

ChristophOlajide

Akinwumi

Infinite Potentials Consulting

SAP

Al Scope

Nôlanta Djunto e.V.Leapfrog e.V.

BMWi

GreenTec Capital Partners

Digitalisierung für nachhaltige Entwicklung, GIZ

GIG / i4policy.org

Afrolynk

BMZ

GIZ

BMZ

GIZ

BMZ

BMZ

African Development Bank



Yaw-Buckman Reymound Airbus BizLab Hamburg

Uber Akash Endeva

Heer Silvia BMZ

Weidner Martin GIZ

Owoyele

Pasipanodya

Babajide

Tendai

Fudio/Afrolynk

Endeva

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Organization Initiatives/objectives aligned with EEP D G I NF ESO

D: Donor, G: Guarantor, I: Investor, NF: Non-Financial Implementation Partner

List of Partners Who Participated and Contributed Through Meetings and Workshops


Boost Africa programYouth Entrepreneurship and Innovation Multi-Donor Trust Fund Jobs for Youth in Africa (JfYA)Affirmative Finance Action for Women in Africa (AFAWA)Rural Microenterprise Flagship Program Model

Financial Initiatives:

Coding for Employment Flagship Program Rural Microenterprise Flagship Program ModelThe ENABLE Youth (Empowering Novel Agri-Business Led Employment) program

Non-Financial Initiatives:

Afrolynk

An impact venture that supports, connects and bring together start-ups, entrepreneurs, investors, venture capitalists, SMEs and organizations pertaining to the EU – African market

DEG

Pro Africa fundEquity investmentsBusiness Support ServicesTraining centers in AfricaUp-scaling Program

Enpact

Startup mentoring and networking platform which aims to strengthen economic relations between entrepreneurs from Africa, the Middle East and Europe, and offers co working space.

GIZMakeITEmployment for Sustainable Development in Africa (E4D)

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OrganizationInitiatives/objectives

aligned with EEP D G I NF

ESO

Federal Ministry of Economic Cooperation

and Development (BMZ)

Marshall plan with Africa (Pillar 1 Economic Activity trade and employment)Digital Africa InitiativeSkills Initiative for AfricaMakeITG20 - Partnership with Africa

GreenTec Capital Partners

Invests in African startups, offers start-ups individually-tailored operational support packages to provide additional operational capacity and expertise

KfWSANAD FundSkills Initiative for Africa (With BMZ)

Venture Capital for Africa

Platform for startup funding and access to online tools and mentorship tools

ESO

ENTREPRENEUR ESTABLISHMENT PROGRAM...Entrepreneur Establishment Fund (EEF) as it has taken shape...

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