TRENDS AND INPUTS FOR FURTHER RESEARCH
the impact of COVID-19 on o ffi ce work but the sustained inability of hubs to raise new funds and not being able to leverage their premises as e ffi ciently as before the pandemic could put them at risk of shutting down, hence, their focus should be on refining their approach in order to achieve finan- cial sustainability. Hubs with diverse models prove more shock-resilient and sustainable. As mentioned, chasing one-size-fits-all models for hubs across Africa is not only detrimental to achieving sustaina- bility, but it fails to understand the very complexity of this type of organisations. This study provides data that substantiate the claim that hubs are no mono- liths and leverage diverse revenue streams that range from consulting to programme implementa- tion, rent, and fund management on behalf of partners. As the startup ecosystem across the conti- nent grows, there is room to increase the emphasis on financing models for startups, from equity to revenue sharing, that can o ff er feasible returns to the hubs. Need to focus on the funnel. Startup ecosystems don’t thrive in silos. The di ff erent components of an ecosystem play a specific role in ensuring the sustainability and longevity of the hubs. As Africa begins to see more sophisticated actors and associ- ations become established, such as the African Business Angel Network, the investor community at large, from donors to venture funds, trade associa- tions and African and global successful startups acquiring earlier-stage companies, the value addi- tion needs to remain a key element in the percep- tion of the hubs’ role. In light of this, hub operators should focus on chasing synergies with partners across the board, not simply to focus on stakehold- ers that can finance their operations.
The conversation about the hypothetical ultimate role played by innovation hubs across Africa has been dominated by conflicting interests and perspectives. As more organisations enter the ecosystem, there is a growing need to address this inconclusiveness by analysing these organisations in a way that factors in the diversity and complexity of such models. This report intended to shed light on such nuances by breaking down the di ff erent aspects that characterised hubs, i.e. their revenue models, service o ff erings, support criteria, and funding sources. Here are some of the key findings: Not every innovation hub is born or geared to be an accelerator. This is a recurring theme, already highlighted in previous literature and in our 2019 report. Data seem to confirm a defined demar- cation between the concept of hub as startup accel- erator, that is, a vehicle providing financial and in-kind assistance aimed at propelling a company’s growth, and the more holistic understanding of hubs as organisations focused on community- and capacity-building, especially in the realm of entre- preneurship and the use of technology or innova- tive models. This is, however, by no means a rigid structure in that hubs can diversify, mature, and grow to become able to raise investable capital and attract mentors to add to their suite of startup support services. Funders and donors still play a key role in the guaranteeing hubs‘ financial sustainability. Although African hubs are becoming more innova- tive with regards to generating revenue to fund their operations and facilities, a large number of them still rely on external funding to take care of their day-to-day operations and fewer of them are charg- ing membership fees when compared to findings from Briter’s 2019 hubs study. This is likely due to
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