The problems facing small and medium-sized enterprises in the country goes beyond the perennial lack of access to cheap credit as most start-up businesses in the country are not ready for investment, Hamdiya Ismaila, General Manager of the Venture Capital Trust Fund (VCTF) has disclosed.
Speaking at the launch of the Innohub Accelerator Programme for start-ups in Accra, she indicated that there are good enough funds for investments but investors mostly look out for ready businesses as they want to avoid wasting their money.
Businesses should be investor-ready from start-up
She said: “The lack of funding and cheap credit remain as hurdles confronting small and medium enterprises in the country; but the absence of strategic plans to entice investors to push the growth of such businesses remains an even bigger limiting factor.
“There are not much investor ready businesses in the country; and most investors will like to inject capital in a sustainable business to avoid wasting money.”
Ms. Usmaila said the quest for sustainable businesses to drive national socio-economic growth hinges on the active role of business accelerators who form the foundation of every entrepreneurial eco-system.
‘options available”
According to her, business accelerators aid in venture development as it is through such systems that budding entrepreneurs and start-ups exposed to the certain core values that are needed to drive the growth of the business.
She added: “The mentoring and nurturing role of accelerators comes in handy as that could form the foundation of the entrepreneurial eco-system. As a country, we need to build the future by helping to grow promising start-ups.
“We need accelerators in the country to help build the entrepreneurial eco-system in the quest for sustainable businesses that will drive national socio-economic growth.”
The investment manager was convinced that business accelerators are necessary initiatives that can address the challenges confronting small and medium enterprises in the country.
“Results have shown that if we pick start-ups and groom them, they become better composed and investor ready rather than when they are picked from the mainstream,” she noted.
Innohub’s Accelerator Programme is a business grooming programme for 10 start-ups picked from various sectors of the economy including agribusiness, finance, ICT and science.
Owners of these businesses will be taken through six-month intensive coaching and business development projects after which they will each be given US$10,000 as seed capital to enhance their operations.
Source: B&FT Online