Opinion | SA does entrepreneurs like us no favours
24 April 2019 - 05:07As millennial entrepreneurs who benchmark ourselves against international standards, we can unequivocally state that SA’s environment is not conducive to the growth of small, medium and micro-sized enterprises. The statistics speak for themselves: according to the Small Business Institute, SA now has 250,000 formal small SMMEs, a drop of nearly 45% from a previously reported 554,000.
One example of a major policy inhibitor is the lack of regulation in the enterprise and supplier development industry. Since the amended codes of good practice on broad-based BEE 2013 came into effect and placed a greater emphasis on awarding points for supporting small black-owned businesses, opportunists have launched ESD programmes of varying quality, ranging from top-notch to fly-by-night.
More often than not, large companies receive BEE points for supporting SMMEs regardless of whether the enterprise succeeds or fails. Creating policies that allow programmes to only claim 50% of BEE and ESD points for supporting the entrepreneur, and the remaining 50% only if the entrepreneur can prove growth in their business as a direct result of the support, is one way in which the industry of support programmes can be better regulated.
Unlike SA, SMME-friendly countries such as Singapore, which is ranked number two on the 2018 World Bank ease of doing business index, offer an entrepreneurship visa that grants start-up entrepreneurs residency for two years to launch a new venture and create local employment. To be eligible for this visa, the foreign start-up entrepreneur must have raised funding from a government investment vehicle, venture capitalist or business angel that is recognised by the government.
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