Government doesn’t get tech startups, but here are 4 ways it can get involved

I have been to several start-up competitions and have visited the technology hubs and incubators in Zimbabwe. The recently held DEMO Africa event at Hypercube, the upcoming Innovation Baraza and numerous other start-up competitions and pitches, these initiatives have largely been achieved at the sponsorship of private funders, embassies and the usual Non Governmental Organisations (NGO) aids.

While an entrepreneurial ecosystem must be allowed to exist without limitations and manipulations from stakeholders, isolating it does not help at all. This is why for me there are some stakeholders that have been largely missing from this ecosystem and have absconded from their implied responsibility as a stakeholder in building a system which has the potential to support economic activity.

The government is a good example of this. Start-ups have the potential to build ideas and businesses that can solve today’s problems in society. From the pitching of an idea, they have the potential to impact, transform lives and shape communities. All these are end results that the government has core custody of. Therefore it makes sense that there should be some involvement at budgetary, operational, implementation and support levels.

What would the government do in the ecosystem if it got involved anyway? Here a re just some areas that would benefit from positive State engagement.

Budgetary Support

The startup ecosystem has a place in several ministries including SMEs, ICT, Postal & Courier Services as well as  Youth and Development. Firstly, the departmental budgets must accommodate developmental funding under whichever ministry and the funding must find its path down to this ecosystem.

This budgetary support can be used to offer direct financial assistance to hubs and incubators or finance the incubation and growth of identified opportunities. Listening the story of Saisai and how they eventually managed to secure tickets to fly to DEMO Africa 2014 triggered this thought that the government could have sponsored such an initiative.

Training and support programs

The government can also be involved by offering business education and entrepreneurship skills. There are various programs that a credit union is constitutionally required to take part in before being given a licence to operate under the ministry of SMEs.

The process involves ministry officials coming to the members and educating them on constitution, culture of saving, dispute resolution and so forth.

Likewise, the government has a place to teach and assist in explaining how a startup (which is a company) is run, the statutory obligations of incorporating a company, registering a company and so forth. When a startup does eventually grow, it is already in the formal sector.

If a startup needs to go for training, it must be assisted in exchange programs or such intergovernmental arrangements. Students who get on to the presidential scholarship program enjoy the full package of tuition, subsistence, travel and so forth and typically the same assistance would be useful. Ultimately such assistance reduces the overall seed money required to setup.

Waivers on statutory requirements

We all remember the first few years into a multi-currency regime when we lived in an ICT development era. Duty on imported ICT products was scrapped and bringing in any device or tech specific peripheral became so easy. The benefits of that are still with us actually.

While the tax on tech has been revised (sadly) the government could still ensure that startups enjoy supportive privileges in terms of statutory obligations such as tax, import duty, travel and so forth.  If a start-up needs to import gadgets to explore potential business initiatives there must be some exemption in terms of duty.

Research and Innovation hubs

While the government may come in to support existing initiatives, the nation can benefit from building something of its own from the ground. The government already has SIRDC for example. Setting up a research and innovation hub through which it can offer opportunities to different communities, including the disadvantaged and underprivileged is the duty and burden of a government.

A government partnered or full fledged initiative would culminate, for example, in teams competing at the eTech Africa expo or ideas being pitched at symposium at tertiary institutions. The government must offer this reward for innovation approach that celebrates achievements and cultivates a culture of startups.

All these initiatives by the government in providing human, financial and professional resources are not in vain. The opportunity to promote startups is fertile ground for the government to invest in promoting business, promote solution provision, equipping the nation, creating jobs and employment and ultimately support the economy.

More directly this is an opportunity for the government to find and develop various home made solutions for its own programs such as eGovernance, ICT for development and financial inclusion, connecting communities and so forth.