The Citizen Entrepreneurship Development Agency (CEDA) says that since inception it has financed projects at a total value of P4 240 billion which have created more than 52 000 employment opportunities.
CEDA Chief Executive Thabo Thamane said challenges that entrepreneurs faced should be fully understood. He is of the view that effective entrepreneurial development can set in motion a wave of impacts in the economy that go beyond wealth created by individual entrepreneurs.
“There has been a big shift in the way the world’s wealthiest are spending and sharing their money due to changing patterns of wealth creation,” said Thamane.
He stated that 40 percent of surveyed listed entrepreneurship as one of their main sources of wealth, compared with 26 percent for inheritance. Thamane added that technological related sectors and property sectors have been cited as areas where wealth is created over a shorter period.
He believes that entrepreneurs through their breakthrough technologies and rapidly growing businesses create new wealth that can generate even greater economic growth.
“Contribution of entrepreneurial businesses to economic growth is often debated. It is, however, evident that high growth entrepreneurial businesses have made a substantial impact on the economy,” he stated.
He further said that the high profile growth entrepreneurs are small in number relative to the hundreds of thousands of new start-ups. Thamane spoke of the evidence that suggests that start-ups and young businesses make important contributions to job creation, innovation and productivity growth. He added that since many start-ups fail and don’t grow, it is apparent that any job creating prowess is not shared equally amongst young businesses. “Globally only 40 percent of start-ups survive three years and more,” he said.
On creating an enabling environment for innovation and entrepreneurship, he said there are lower barriers to market entry. He stated that it was important to create support mechanisms for entrepreneurship. Thamane also said increasing opportunities for people to learn the process of becoming an entrepreneur and starting a business could be done through offering incentives that foster entrepreneurship. He added that access to reliable and steady source of funding are key as well as diverse sources of risk capital.
He also spoke of the need to encourage big firms to support small enterprises through suppliers and also providing access to finance. He added that it is important to strengthen financial institutions’ support to SMEs by increasing funding pool to such businesses.
“We support business development through various funding mechanisms, thereby promoting citizen economic empowerment and entrepreneurship,” said Thamane.