Assessing African Scaling Perspectives
Scaling. What does the term really mean? And how do you actually do it?
We start from a general observation that start-ups lack a cogent framework for transitioning into mature firms. We might also assume that these enterprises can improve their prospects by understanding the mechanics of effective scaling. Sadly too little is known about how to do this well in the highly challenging African context.
Despite the importance of scaling-up and rapid growth to stimulate economic growth and job creation, there are gaps with existing research and knowledge. Insights that are available remain somewhat disjointed about the specific factors which enable a successful transition from start-up to scale-up. It is clear that African businesses face very different challenges due to complex underlying conditions. Context matters. But what do we really know about this, and what can be proven?
Many analyses covering sub-Saharan Africa tend to focus on broad macro conditions — internet penetration and connectivity problems, or underlying structural issues such as regulatory frameworks, rather than drilling down on specific micro ‘success’ factors. Given the vast investment which goes into the entrepreneurship ecosystem, it’s imperative to understand whether we can define a scaling DNA code, which takes into account, and designs for, the unique contextual circumstances that these businesses operate in.
We believe that a comprehensive examination of how African scaling businesses grow — and how they succeed in complex, dynamic, challenging conditions — is vital. Currently, there are important knowledge gaps regarding critical success factors, processes, and how context-specific conditions are assessed; but there should not be.
Our working assumption is that African scale-up support can be better designed to help high-growth businesses succeed. But we need more empirical evidence to assess what exactly is needed so that the right models of targeted programmatic support can be delivered (in the right way, at the right time).
We also believe that deeper integration between academic theory and management practice would be mutually beneficial. Applied research knowledge should be translatable, and readily available in different forms that are easily accessible to entrepreneurs. Too often it is not. Conducted well, applied research yields actionable results offering answers to key challenges, which can assist companies and stakeholders to make better, more informed decisions for different, improved results.
Over the past weeks, HYBR has been looking into these subjects in detail. We have dived into all the published evidence that exists. We have talked with academics, founders, investors, and ecosystem enablers to gather perspectives. In March, we host separate working sessions with founders, investors, and academics to complete our diagnostics assessment, before we consider how to design a strategic roadmap to take forward a series of evidence-based recommendations.
Actions count. We invite strategic partners to walk with us on this journey ahead. Our aim is to contribute to the success of how all African ventures can build better in the future.
Focusing on scale-ups really does matter; after all, these are the ones that will really move the impact needle.
Author: Scott Walker