By Jean Pierre Afadhali
The United Nations Development Programme (UNDP) launched today the ambitious initiative dubbed “timbuktoo” together with African countries to support African startups in a special session of the World Economic Forum at its 24th Annual Meeting in Davos, Switzerland.
President Paul Kagame of Rwanda, President Nana Akufo-Addo of Ghana, the Secretary General of the African Continental Free Trade Area Secretariat, Wamkele Mene and UNDP Administrator Mr Achim Steiner presented the initiative, which according to the UN development agency could be the world’s largest financing facility bringing catalytic and commercial capital together to support Africa’s startup ecosystem.
Promoted by the UNDP, timbuktoo aims to address critical gaps and work with African governments, investors, corporates, and universities, to support the African startup ecosystem.
“We cannot accept that another generation of African young people do not have the tools to reach their full potential,” emphasized Mr. Kagame, who announced an immediate contribution of US$3 million to start the timbuktoo Africa Innovation Fund which will be hosted in Kigali, Rwanda. “With timbuktoo’s billion-dollar target, we can create more opportunities for Africa’s youth to put their talent and creativity to good use.”
“For many African countries, our foremost challenge now is to ensure we put in place the right structures to enable young Africans to create innovative and compelling businesses that can contribute significantly to job creation and sustainable economic growth,” highlighted Nana Akufo-Addo. “I’m excited about the future of our continent. I look forward to seeing us create a future where innovation is encouraged, ingenuity is supported and prosperity is shared.”
Attended by global corporate leaders, as well as African financial institutions, the occasion marked what is considered “a major step in sparking the African Startup Revolution, harnessing the momentum of Africa’s major youth demographic and abundance of innovative talent,” said UNDP in a press release.
“timbuktoo is a new model of development. We are gathering key actors to push on all fronts at the same time. From startup-friendly legislation, global-class startup building, and de-risking capital to increase investment, to the UniPods – University Innovation Pods – across Africa, we aim to fill critical gaps and support the startup ecosystem. This will enable innovations to grow and benefit people in Africa and elsewhere on the planet,” stressed Administrator Steiner.
Currently, Africa’s share of global startup value stands at just 0.2 percent, compared to 2 percent of global trade value. The vast majority, 89 percent, of venture capital coming into Africa is foreign capital and 83 percent is concentrated in four countries: Nigeria, Kenya, South Africa, and Egypt, with over 60 percent of capital flowing to one sector, fintech.
According to Ms Ahunna Eziakonwa, UNDP’s Assistant Administrator “A knowledge-driven African economy can transform the continent, far beyond even the wealth of the resources that lie beneath its ground and on its land. It is a true revolution.”
Eziakonwaadded “timbuktoo will turn ideas and nascent innovations into meaningful scaling and disruptive Pan-African enterprises that attract global and local investment, generating wealth and wellbeing for millions of people in Africa and beyond, focusing on innovative solutions for people and planet”.
With an unparalleled surge in private venture capital investments, growing six times faster than the global average in 2022, a vibrant youthful population and rapidly expanding tech startups, Africa is a future tech powerhouse, said the UN development agency.
Key African companies are already leading in some global digital technologies, such as mobile money, and millions of people are leapfrogging traditional development paths.
Timbuktoo’s ambition is to mobilize and invest US$ 1 billion of catalytic and commercial capital to transform 100 million livelihoods and create 10 million dignified new jobs.
“What makes timbuktoo unique is its design, which blends commercial and catalytic capital to de-risk private investment, with a Pan-African approach to supporting startups, while also focusing on the whole ecosystem, engaging and deepening the linkages between government policy, universities, corporates, development partners, catalytic partners, and commercial investors,” stressed the UN development agency in a news release.
In recent years, startups have created jobs for many young Africans, but financial challenges among other entrepreneurship problems are hindering their growth in many business ecosystems on the continent.
