- Close to 80 per cent of startups often die within the first year of operation.
- Only three to five per cent make it beyond the one year period of survival.
Startups have the potential of accelerating up to 70 per cent of Kenya’s digital transformation, Communications Authority CEO Ezra Chiloba says.
However, he said major bottlenecks such as funding and compliance constraints see majority of them close shop in less than a year.
“Close to 80 per cent of startups often die within the first year of operation, while only three to five per cent make it beyond the one year period of survival,” Chiloba said.
He further noted that the remaining 15 per cent fall under the unpredictable category, who still have very low chances of survival.
To cure this, Chiloba said startups in the country, more specifically fintechs, should partner with investors across different sectors to ease their challenges.
"Leveraging partnerships means the firms will be able to enhance financial control and drive operational efficiency by providing valuable insights and other strategic support functions, enabling them focus on core activities and achieve their strategic goals," Chiloba said.
Similar advice was given by DTB's Group CEO and managing director, Nasim Devji, who said partnerships are crucial in accelerating development of innovative fintech products and services.
"For instance, serving as the link between banking and technology, collaborations give customers access to personalised, secure and user-friendly financial solutions, and positions the parties at the forefront of the industry,” Devji said.
The two spoke yesterday in Nairobi during the market entry announcement of a Kenyan fintech, Boya, which launched a virtual expense card seeking to help businesses transact seamlessly at cheaper costs.
The tool also seeks to help firms manage both local and international payments and expenses with one virtual card solution at zero fees.
Boya’s CEO Alphas Sinja, said realisation of the milestone came alongside partnership with Diamond Trust Bank and the digital payment platform Visa.
Boya has integrated DTB's cards as a service offering into its platform.
The integration will enable Boya's customers access virtual corporate cards, supported by the Visa card scheme.