The needs and challenges of SMEs in the City of Johannesburg: A focus on the Entrepreneurship Ecosystem
Date
2019
Authors
Majaja, Buntu
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Abstract
Entrepreneurship ecosystems have increased in popularity as an approach to fostering more entrepreneurial activity and, hence, spurring economic growth. This research was a propagation of this phenomenon within the context of Africa and Johannesburg, South Africa.
The objective of the research was to explore the City of Johannesburg’s entrepreneurship ecosystem by achieving three aims. The first was to aggregate primary data of the ecosystem through the entrepreneur’s perspective and the second was to map this data over the city’s geography based on Isenberg’s (2011) entrepreneurship ecosystem framework as a theoretical foundation. Then lastly, it was to create a framework to better understand the entrepreneurship ecosystem of Johannesburg in order to fill the gaps.
A survey was performed on entrepreneurs across the city in divisions of geographic categories known as regions, where there are seven in total. Data was collected via paper surveys and the surveys were then aggregated and analysed through simple observation, comparison and pattern recognition. Then data reduction was performed in order to extract deeper insights from the data where a framework could be considered and developed, using literature and the data.
The map of the City of Johannesburg’s entrepreneurship ecosystem, as depicted in the study, indicates that the issues faced by entrepreneurs across different regions are not different by much and that there is relative homogeneity. The key challenges (in no specific order) were access to markets, equipment, and suppliers and the key needs identified were investors, suppliers, and entrepreneurship education.
The entrepreneurship ecosystem domains were access to markets, finance and human capital which represent the most significant challenges and needs of entrepreneurs in the City of Johannesburg’s entrepreneurship ecosystem.
A contextual model was developed to consider approaches and it was based on residual and latent interrelatedness between the domains, access to markets, finance, human capital and policy (Isenberg, 2011). Complex network theory aligns with the contextual
model’s suggestion for the role and importance of social networks in facilitating the multiplexity of interactions of economic agents between the identified domains in a context of supportive policy for entrepreneurship to thrive (Bull & Willard, 1993; Ferrary & Granovetter, 2009).
Keywords: Entrepreneurship ecosystem, Complex network theory, Entrepreneurs challenges, Entrepreneurship economic development, Entrepreneurs needs,
Description
A research report submitted to the Faculty of Commerce, Law and Management, University of the Witwatersrand, in partial fulfilment of the requirements for the degree of Master of Management in Entrepreneurship and New Venture Creation
Wits Business School
28 February 2019