E ndeavor South Africa was officially launched at an event hosted by the Gordon Institute of Business Science in Johannesburg, South Africa on the 25th of May 2005. The theme of the affair was: "Accelerating Economic Growth through Entrepreneurship." As the theme of the affair would suggest, Endeavor and the Gordon Institute of Business Science held a presentation and discussion on accelerating entrepreneurial activity and economic growth.
The event in South Africa took place eight years after Peter Kellner and Linda Rottenberg founded Endeavor in 1997 by as a U.S. based non-profit organization. Endeavor was established to spur economic growth in emerging markets and bridge the gap between micro-credit organizations and large-scale public-works projects. In 1998 Endeavor had launched operations in Argentina and Chile with $500,000 in seed money from one donor and a $200,000 matching grant from another. In the year 2000 Endeavor launched Endeavor Brazil and Uruguay, one year after it had organized its first venture forums, linking international investors with emerging-market entrepreneurs. One year after launching Endeavor Brazil and Uruguay, Endeavor Mexico was launched. In 2003, the International Finance Corporation (which is the private sector arm of the World Bank) funded Endeavor's "scoping trips to Africa and in 2004 Endeavor began its initial Search and Selections operations in South Africa.
Endeavor was begun when its founders realized that the traditional means of promoting international development have not catalyzed high-growth entrepreneurship. Many of the finance programs in developing nations focused on micro-finance programs projects that provided subsistence-level loans to the poorest of the poor. The governments and private equity investment groups in developing nations focused mainly on large, established companies. Under this scenario the high-growth, innovative entrepreneurs in emerging market were not being targeted for financing. Without this financing, entrepreneurship will not develop, as entrepreneurship in developing countries will not happen naturally, due to a series of barriers that impede new business creation. Those barriers include:
1. Closed networks for people without family connections
2. Limited access to capital, training and mentoring
3. Lack of trust among entrepreneurs, the private sector & government institutions
4. Inadequate education on new venture creation and
5. Few local entrepreneurial role models
Endeavor not only helps to make financing for these businesses available, but it also has developed a business model that systematically eliminates those barriers. This model has five components.
1. Identify high-growth emerging market entrepreneurs
2. Support selected endeavor entrepreneurs
3. Build a venture friendly environment
4. Foster broad scale entrepreneurship education
5. Promote local role models to inspire a new generation of entrepreneurs models
And all the time that Endeavor is carrying out these five functions, it is also Selecting Country Benefactors and launching affiliates for Endeavor Global.
Endeavor says that it decided to launch an operation in South Africa because of the challenges that remained in that nation even after decades of Apartheid ended in 1994 with an inspiring political power shift.
While South Africa works on achieving racial equality, a globally competitive economy, and educational opportunity for all, unemployment hovers around 40% of the economically active population. And while government empowerment initiatives aimed at creating a boarder racial representation at all levels of the economy, this has redistributed the wealth to some small degree rather than create new sources of wealth and empower the boarder community.
Endeavor South Africa announced its first class of Endeavor Entrepreneurs on December 6, 2004 after a six-month search and selection process. One hundred and sixty on companies had been nominated as candidates for the program, but only 6 were chosen after a very rigorous screening and selection process by a panel of leading local and international businesspeople. (However, 8 individuals were chosen - all within these 6 companies.) Those 8 individuals work in industries dealing with: mobile phone software, dairy products, mining safety equipment, radio syndication, training and learning through IT delivery and electrical supplies distribution.
Part of the criteria for selection was that the nominees' companies were expected to have generated revenue of "R3m to R60m and must have truly innovative products, services or processes and a strong potential for growth." However, start-up companies could be considered if they are considered to be innovative enough.
The selected entrepreneurs undergo an 18-month program that is designed to prepare them to become "models of entrepreneurship and innovation in South Africa. It is expected that a second group of applicants will be selected in October of 2005.
Unfortunately, South Africa is the only country in Africa where Endeavor operates, but for those of you entrepreneurs in South Africa who have an innovative business and need a "leg up" consider going to Endeavor's web site and looking it over. Maybe their program is for you.
Endeavor South Africa