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Six tips for young entrepreneurs to overcome common challenges

This month the 2015 finalists for The Anzisha Prize, Africa’s premier award for its youngest entrepreneurs, travelled from their various countries to meet at the African Leadership Academy in Johannesburg. For a week they underwent rigorous training and mentorship, before pitching their businesses to a panel of expert judges. And last week the winners were announced.

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Chris Kwekowe (22), co-founder of Nigerian e-learning and job placement platform Slatecube is the 2015 Grand Prize winner, and takes home US$25,000. First runner up is Cameroon’s Fabrice Alomo ($15,000) with third place going to Ghana’s Mabel Suglo ($12,500). Chantal Butare, founder of Kinazi Dairy Cooperative (KIDACO) in Rwanda, won the Agriculture Award and $10,000. All of the finalists took home $2,500.

But arguably more valuable than the cash prizes was the week of mentorship and one-on-one support from various industry experts. One of the mentors included Koovi Moodley, venture manager at the Gauteng-based incubator, the Awethu Project. She noted young entrepreneurs typically face exceptional challenges getting businesses off the ground and shares six basic tips that can help them overcome them.

1. Google is your friend
“Google is an amazing tool. The internet is awesome… There are a lot of tools and information online that are free. You can go onto Business Partners’ website and find out how to do marketing. You can go onto the websites of any of the entrepreneur magazines, and useful articles will pop up.”

She added young entrepreneurs need to have an enquiring mind to seek out answers and ‘self-vet’ the information they get online to determine what makes logical sense for their business.

They should also make use of social media such as Twitter and Facebook, not just to showcase their products or services, but to stay connected with organisations that assist entrepreneurs.

“If there is a government organisation, or a non-profit, or something like the Anzisha Prize… find out all about it,” she continued.

2. Talk to other entrepreneurs and find a mentor
Entrepreneurs also need to embrace networking sessions where they can interact with other business people, both young and old. Networking will provide valuable insight into how common challenges have been overcome, noted Moodley.

In addition, young entrepreneurs can also find mentors elsewhere, such as within corporations or universities.

3. Do your research
“If you are going to someone for advice, you need to have done your research. You are not going to them for all the answers. You are going to them for the answers you could not find yourself, because no one is going to hand it all to you on a platter,” Moodley continued.

People will be more willing to assist young entrepreneurs if they can see they’ve done their research, she noted. They should approach industry-related experts with enough knowledge and understanding around a particular problem to suggest they’ve already tried to solve it themselves.

“Because then they will have seen you’ve taken the initiative, put in the time, and paid in sweat. And people are more likely to make those five minutes available for you if they have seen you have done the work. If not, why should they sacrifice their time, if you haven’t sacrificed yours?”

4. If you can, self-fund
If possible, entrepreneurs should look to self-fund as much of their business as possible – or borrow from friends and family. With the shortage of financing on the continent, young entrepreneurs may never get their idea off the ground if it is completely reliant on external funding. Furthermore, those that have some skin in the game themselves, are more likely to be taken seriously by other investors, Moodley explained.

However, other financing options include crowdsourcing platforms and appealing to companies’ socio-economic development funds.

“And sometimes there are local programmes where you don’t get funding unless you show that you are willing to get trained. They will have workshops, and participation will be a prerequisite before you are even considered for financing. So you need to determine what you value. Organisations now want accountable entrepreneurs that can pay back loans because there isn’t an infinite pool of funding.”

5. Prove your concept
Furthermore, young entrepreneurs who have proved their business concept, have tested a product or service in a market, are more likely to attract investors.

“Show you have at least tried to do something. Don’t just say this is my pie-in-the-sky idea… What have you done to try and prove it is going to work to make someone comfortable enough to risk investing in it?

“You get taken seriously when you provide proof that you know what you’re talking about… If you can actually motivate, justify and show you have done your research and paid your dues, you will get the respect you deserve.”

6. Manage your time
For young entrepreneurs juggling a number of commitments, efficient time management has never been more important.

“Nothing comes easy. The business that breaks even in the first month and makes its first million in five months – that is like one in a billion,” she warned.

“Understand that it takes time, smarts and hard work to build something sustainable.”

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