Entrepreneurship and Innovation in Africa

Entrepreneurship and innovation are pivotal for Africa’s economic progress. However, the continent faces a dearth of investment, with the existing venture capital (VC) majorly channeled towards fintech, sidelining other sectors. Despite the growing VC interest, African entrepreneurs grapple with barriers such as high startup costs, restrictive capital requirements, limited access to financing, regulatory issues, and concerns about bribery of government officials and low trust in governance. Institutional hindrances, the prevalence of informal businesses, management quality issues, and concentrated firm ownership further exacerbate the innovation deficit. Conversely, Africa shows promise with expanding VC investments, budding fintech sectors that can bolster financial inclusion, such as mobile-money platforms, and a surge in female entrepreneurship. Moreover, the continent is becoming a center for financial technology innovations and boasts a rising presence of startup accelerators and incubators, which offer pivotal support to early-stage ventures. This chapter offers a comprehensive look at these facets, intertwining entrepreneurship and innovation in Africa, addressing challenges, and highlighting opportunities and policy-related questions for future exploration