This archive report was first published on 18 December 2019.
Kenya has made significant strides in improving its ease of doing business, ranking 61 out of 190 economies in the World Bank's annual ratings, up from 80 in 2017. However, despite these efforts, the cost of credit remains a major challenge for young people interested in starting their own businesses.
According to Dr Kellen Kibatian, a senior lecturer and social scientist at Karatina University, 'crowdfunding and market place lending are disrupting traditional methods in the financial services sector, delivering the flexibility and robustness needed.' However, he warns that crowdfunding is not easy and requires a deep and well-thought-out idea, commitment, high momentum, sourcing backers, and consistent reputation management.
Research has shown that 80% of crowd funders are second-degree friends or friends of friends, highlighting the importance of building relationships and networks in successful crowdfunding campaigns.
To succeed in crowdfunding, young people should set clear objectives, do their homework on the rules and regulations, identify the most appropriate structures and platforms, determine their target audience, develop communication and marketing content, and articulate clear feedback mechanisms.
Dr Kibatian also emphasizes the importance of having a well-managed communication desk to promptly respond to high volumes of questions, emails, and comments, as well as a team of trusted confidants to watch and proactively point out what is not working in the campaign and propose quick corrective actions.
