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Building South Africa by building youth entrepreneurs

South Africa has been regarded as one of the most unequal countries in the world, and the effects of this sit heaviest on the shoulders of our youth.


By Busisiwe Bebeza, Programme Manager. Business Incubation at Fetola

Our country has one of the highest unemployment rates in the world, with 46% of those aged between 15 and 24 without work[1]. But this is the same group whose passion and resilience can transform our economy – if we invest in them, offering them the skills they need. More than half[2] of our entrepreneurs are youth. And as we know, entrepreneurship is one of the best ways to drive economic development and create jobs. This means the next generation is essential for changing our country’s future. For us to get to that future, we need to support their bold and inspiring business ideas, ensuring that they can create sustainable enterprises that will not just survive, but thrive.

Creating an entrepreneurship ecosystem
South Africa still has a long way to go before we have an ecosystem that promotes entrepreneurship. In the National Entrepreneurship Context Index, South Africa ranked 49th out of 54 economies in 2019[3]. Rankings such as this show us that there are serious challenges facing our young entrepreneurs and that we must act quickly to address them.

But the challenges of South Africa’s entrepreneurship ecosystem aren’t spread out evenly, with the very same people affected by poverty and unemployment also impacted by challenges to entrepreneurship.

Evidence has shown that historically disadvantaged communities are producing fewer entrepreneurs than affluent communities[4]. While this should not be surprising, based on the fact that access to resources and education has a lasting impact on an entrepreneur’s success, it does have devastating results for South Africa’s informal areas and townships.

With more than 60%[5] of the country’s unemployed population among the 22 million South Africans living in townships and informal settlements, it is clear that these communities urgently need to be the focus of employment interventions. Because we know that entrepreneurship leads to employment, we need to focus our efforts to upskill entrepreneurs in these areas as well.

Creating jobs in these areas is likely to have the biggest impact, as these communities tend to have the highest concentrations of poverty[6]. Already, the township economy is responsible for creating 17% of South Africa’s total employment[7] (2.5 million workers) and makes up about 6% of the country’s GDP.

There is no lack of talent in townships and informal areas. They are home to robust entrepreneurial activity supported by their communities. Township entrepreneurs have proven to be experts at identifying opportunities in their markets[8]. These entrepreneurs also provide a vital network that sustains small businesses in the township economy, with almost half relying on other small businesses as key clients[9].

Building entrepreneurs to build South Africa
There are a multitude of challenges facing our young entrepreneurs – everything from high data costs to a failing education system. But there are targeted and tailor-made solutions to help young entrepreneurs learn the skills they need to thrive.

This is exactly what the Fetola Youth Start-up Accelerator Programme aims to do. The fresh, innovative one-year programme is designed to help young aspiring entrepreneurs grow and develop their business ideas. Aimed at unemployed youth, graduates, matriculants, and aspiring entrepreneurs between the ages of 18 and 35, the programme will teach 100 young innovators the skills needed to develop their business idea and get their enterprise off the ground.

It’s a solution that speaks to some of the biggest barriers facing young entrepreneurs: a lack of key business skills, access to mentors and the opportunity to test out their business ideas. If any of these key ingredients are missing, our young entrepreneurs could find themselves among more than half of businesses that fail within the first year[10].

Investing in these young entrepreneurs is essential. Entrepreneurial activity is among the highest in people aged 25 to 35, showing us that this is a critical age group to target with interventions.

Not only do we want to inspire our youth to dream of a better future, but we also aim to equip them with the skills that will help them build South Africa.

… the programme will teach 100 young innovators the skills needed to develop their business idea and get their enterprise off the ground.

[1] http://www.statssa.gov.za/publications/P0211/P02113rdQuarter2021.

[2] https://brandsouthafrica.com/state-of-entrepreneurship-in-southafrica/
[3] https://www.gemconsortium.org/file/open?fileId=50671
[4] https://www.gemconsortium.org/file/open?fileId=50671
[5] https://www.businesslive.co.za/bd/economy/2018-03-14-townshipsare-

[6] http://www.treasury.gov.za/divisions/bo/ndp/TTRI/TTRI%20Oct%20

[7] http://www.statssa.gov.za/publications/P0211/P02114thQuarter2020.

[8] https://www.gibs.co.za/news-events/news/pages/understanding-thetownship-

[9] https://www.gibs.co.za/news-events/news/pages/understanding-thetownship-

[10] https://businesstech.co.za/news/business/487503/south-africa-hasone-

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