Kenya currently lacks the adequate skills that can produce a solid pool of internationally competitive, technology enabled businesses. SMEs, which are key drivers of the economy, face difficulties in improving their productivity due to poor managerial practices and information failures around how to upgrade. The country also has limited contact between traditional industry and technology enabled startups; a missed opportunity for both sides. Kenya’s other challenge includes limited connections to networks of international mentors, angel investors, and venture capitalists all of which make it difficult for local startups and SMEs to grow and compete internationally. For Kenyan women entrepreneurs, particularly those who own startups and SMEs; all these challenges are even more pronounced.
Kenya: Industry and Entrepreneurship Project (KIEP) is a $50 million lending project being implemented by The Kenyan Ministry of Industrialization and enterprise development (MoITED) to increasing innovation and productivity of private sector firms. The project launched in June 2019 and MDTF funds were used to run entrepreneurship and other design pilots including to advance gender outcomes, document best practices for the local market and provided direct inputs into the design and implementation of KIEP component one on “Strengthening the innovation and entrepreneurship ecosystem”. The pilots and studies conducted helped identify key learnings to inform project design and discover key issues faced by entrepreneurs including such as (i) lack of mentorship networks for female entrepreneurs; and (ii) lack of funding accessibility.
KIEP is expected to benefit some 33,050 individuals and 2,393 firms. It will support the ambitious development targets outlined in Kenya’s Big Four development agenda and Vision 2030 that require significant growth in private sector jobs and overall productivity. The Ministry of Industry, Trade and Cooperatives, through the Kenya Industrial Transformation Program, prioritizes technology and innovation as the cornerstone for national industry development and the role that private sector firms play in driving Kenya’s industrialization.
“In today’s fast-paced, globalized economy, start-up driven innovation is key for economic development as it creates new jobs for the growing youth demographic,” said Elena Gasol Ramos, Senior Private Sector Specialist and Task Team Leader. “By strengthening technology incubators and accelerators, the Kenya Industry and Entrepreneurship Project will directly benefit SMEs, students, corporates, startups, technology hubs and technology bootcamp providers.”
KIEP is the first lending operation with Kenya’s Ministry of Industrialization and enterprise development in 14 years, and the first lending project in the African continent that is supporting the Digital Transformation Initiative. Without the MDTF-funded activities, the preparation of the project would have faced severe difficulties due to constraints on the client’s side in terms of capacity and experience and the inherent risks associated with innovation. The MDTF-funded activities helped to build client capacity, knowledge and exposure, and reduce the risk of innovative approaches through piloting.
Through MDTF support, the World Bank team along with Government counterparts were able to identify specific ways to support women in technology, women founders and women-led SMEs. Specific consultations focused on obtaining feedback from potential female beneficiaries, including female entrepreneurs and students, as well as women in technology were conducted. These activities informed project design and will contribute to a better understanding of the women in business landscape in Kenya and prepare a foundation for future gender-focused interventions in the country.
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