Private sector to raise Kshs 1 billion to scale up IT start-ups

After President Uhuru Kenyatta pledged Kshs 1 billion to Enterprise Kenya to fund idea stage star-ups as well as Growth Stage start-ups at the National ICT Innovation Forum held last month in Nairobi, Kenya’s private sector is also looking to raise another Kshs 1 billion as a matching fund to help Scale up start-ups in the coming days.

This was said by Mike Macharia, CEO Seven Seas Technologies who is also the Chairman of Kenya IT and Outsourcing Society (KITOS) at the Connected East Africa Summit held in Diani, Kwale County

In Yesterday’s forum, the Cabinet Secretary, Ministry of ICT said that through the Enterprise Fund they will first look into scaling up at least 50 Start-ups and also stated that the Ministry of ICT was still working with the ministry of Devolution and Planning to see how innovators can benefit from Uwezo and The Youth Fund.

Enterprise Kenya is a national accelerator that will catalyse innovations and provide entrepreneurs with needed support in their innovation journey.

Enterprise Kenya will drive engagements with relevant government agencies to cause a review of the current procurement law with a view to giving Kenyan ICT businesses more opportunity to supply government technology solutions. The entity also looks at the establishment of an Equity Fund to support ICT innovations that could be quasi-government or private; and the creation of ICT Centres of Excellence that are linked to government ICT spending.

The body will facilitate Kenyan enterprises to start, grow, innovate and win export sales on global markets. In this way, the accelerator will support sustainable economic growth, regional development and secure employment.

The enterprise Kenya vision, fronted by the ICT Authority in conjunction with Ministry of ICT and private sector players will drive the agenda of “Buy Kenya IT, Build Kenya IT, To Build Kenya.”

The enterprise is part of Kenya’s agenda to become an ICT hub in Africa as envisioned in the National ICT Masterplan 2017. The Masterplan looks at having ICT contributing 8 per cent to National GDP, creating 180,000 direct jobs, nurturing 55 global competitiveness ICT companies, building a US$ 500 million tech-based venture capital fund and growing ICT exports to US$ 1 billion by the year 2017.

Mr. Macharia also said that another way they could fund the innovations is by insisting that they first get registered under Growth Entreprise Market Segment, which is a product of the Nairobi Securities Exchange and defined by NSE as an enabler of SMEs to enable substantial, initial and ongoing capital while benefitting from increased profile and liquidity within a regulatory environment designed specifically to meet the needs of SMEs. GEMS also helps SMEs engage with Global investors and local investors and is quite low and provide GEMS listing options are quite low and provide an early adequate capital raising option for technology start-ups.

Mr. Macharia also pointed out that in 90 days they will be looking into crystalizing Enterprise Kenya Objectives.