‘Poor Planning Cause Of Startup Failures’
Poor planning and execution have been identified as a primary cause of startup failures, especially in Africa.
Industry leaders at a just-ended Project Preparation Masterclass webinar, said the most brilliant plan will not secure the required funding, if investors are not satisfied with the viability of a project.
Organised by the African Business Roundtable (ABR) and the African Import-Export Bank (Afreximbank), the experts indicated that many startups lack the knowledge and skill needed to take their plan through the required stages – from idea generation to pitch presentation.
Head of Project Preparation at Afreximbank, Zitto Alfayo, said, “Out of every 10 transactions conceived in Africa, only one gets to financial closing. We have analysed and found that the key challenge comes in at the feasibility stage.”
“This is where one needs to commit resources, time and effort in order to get to bankability,” he added.
Director of AU/AfCFTA Relations and Trade Policy of Afreximbank, Yusuf Daya, noted, “We recognize that trade finance in Africa continues to be handicapped by liquidity constraints, further worsened by the withdrawal from Africa by foreign banks and low access to financing for SMEs.”
For this reason, he said Afreximbank had prioritised facilitating trade finance on the continent.
In his closing remarks, Dr. Mohammed El Sahili, African Business Roundtable Country Director in Zambia, stressed that the issue of attracting funding from investors is of great importance, and therefore it is in the interest of entrepreneurs and businesses to acquire this skill.
“The next webinar in this series is scheduled for September 28th, 2022, and will focus on case studies of real projects and center on specificities of project preparation,” he concluded.
The webinar focused on filling a knowledge gap which is inhibiting African companies from accessing the financing needed to take their projects off the ground. Participants listened to banking and trade experts with decades of experience from all over the continent share insight on how best to approach the right investors to secure funding for their projects.
The ABR came into being 30 years ago with the clear objective of supporting the private sector of Africa, nurturing it to a point of international success and recognition. Afreximbank, a trade finance bank, has also spent the past three decades assisting African entrepreneurs and businesses in realising their projects. It was this joint objective that led both organisations to coordinate the Project Preparation Masterclass webinar, free and accessible to all.
Other speakers were Justin Chinyanta, Vice President of the African Business Roundtable Southern African Region and CEO of Loita Capital Partners; and Nana Amoto Mensah, Executive Director C-NERGY Global Holdings, Ghana.