Monday, October 11, 2010

Youth and Entrepreneurship in the Ethiopian Society

By: Gedion Yitbarek

Challenges are common when executing a business venture with any level of sophistication. What makes it even worse is being young and introducing a new business idea to the society of a developing country. After years of faulty systems that degraded the confidence of the consumers and investors in their country, Ethiopians are doubtful about the possible success of newly emerging businesses that could potentially lead the local economy towards prosperity. The only way to rebuild this eroded confidence is when citizens, young or old, recognize the youth as a stakeholder. Involving the youth in decision makings and equipping them with the necessary leadership skills bring up a sustainable changes in the future generation. The old saying, “Ante lij neh minim atawukim” (“You are a kid and don’t know anything”) has no place in the 21st century and we must erase it from our society.

Thousands of businesses arise in Ethiopia every year with a significant amount of capital. A few reach to a peak where growth is almost stagnant afterwards. Thus, instead of allocating additional resources and funds to grow further sustainably, these businesses choose to stay at their peaks for a while until a competitor with a better approach joins the market and topples them. Eventually, when these companies can’t stay in competition anymore, they declare bankruptcy or sell the company at a low price. Nowadays, it’s rare to see companies in Ethiopia passing a second generation within the founding family. This is the result of excluding the youth in the process and not preparing them to take over in the future. As seen in most cases, when parents are ready to retire the business they own dies as their kids are not ready to take over. The son or daughter of a company owner is only expected to attend school and never worry about financial decisions that might impact him or her in the future. This problem also manifests itself in any status of the society among Ethiopians; parents do not involve the youth in major decision makings and this has major impact in establishing long term projects that require a high level of leadership and commitment.

It’s normal to see that short term money making techniques such as importing processed goods from other countries have taken over the Ethiopian economy. Surprisingly, not enough is exported to balance the currency. Our society has evolved into making fast money by importing goods as supposed to building a company to produce the items. It’s obvious that building a company needs a raw material, a skilled man power and not to forget a great leadership. By saying a great leadership, it’s not only referring to the CEO of the company but also every single individual in the hierarchy responsible for executing a specific task. Thus, the kind of leadership needed within the company to make it sustainable neither exists at the moment nor does it spark overnight among the individuals in the future; it is a long process that is rooted back to the early age of the professional workers. Unfortunately, Ethiopian schools do not have programs and clubs that develop leadership skills among students and this correlates to why we do not see great leaders of big companies. The society needs to understand that going to school and passing exams isn’t the only way to solve problems of any kind in the country; rather being able to cooperate with one another and executing ideas towards success is the major thing everyone should focus on to bring a major change.

The short life span of businesses in Ethiopia is an indication of not planning sustainable projects that can survive for decades within our society. Apparently, projects which have high rate of return in a short period of time are common business practices. The ones that take long and challenging process are, as mentioned above, imported from other countries. This approach impacts everyone especially the youth. A lesson taken from these companies by the youth is choosing short cut businesses as supposed to building a legacy that can pass to generations. The society is doubtful to welcome a sophisticated system which takes years to build because they already assume that it’s going to fail without even trying it. A professor at one of the major universities in the United States called this behavior, “an Induced Helplessness.” In her simple experiment she proved that a repeated failure in the past might discourage an individual to believe in the success of the future outcome, even if it might have a great chance. Therefore, the Induced Helplessness in our society can only be solved by giving more attention to the youth. Instead of exposing them to repeated discouraging failures, the society should give the youth a chance to try out new things and experiment on ideas with peers through different simulated clubs and school programs.

In my senior year at high school in Addis Ababa, I was invited to prepare a game for a carnival. I designed one which allowed 5 people play at once. The challenge wasn’t building the game; rather it was convincing my friends to help me promote it to the carnival kids. Only one agreed to stay and promote my game while the rest thought it was a joke wasting their time while they could promote the ones which were already making fast money at that moment. Afterwards, I called a few kids and gave them free sample coupons. I also told them they could get more free games if they convince their friends to play at my station. Honestly, whom do kids listen to more than adults? Anyways, those 5 kids brought 2 each and those 2 brought many more which later that day enabled me to make more money than the rest of the carnival games. This is the concept that lives inside me in my future business venues. Some might believe in me and help me grow while the rest abandon my effort thinking that it is a waste of time. But the truth is, as long as one strategizes and does things bravely, there is always a way to win a customer’s attention. As a youth, that specific day had impacted my life because I experienced what it meant to be a successful businessman for a day. Indeed, similar chances should be granted to all youth who want to be business owners; only then can they learn to make wise decisions, which will serve them for the rest of their lives.

We have responsibilities to build a community based on optimism, hard work, commitment and a great leadership. If these four things are embedded within the minds of the Ethiopia’s youth, a more sustainable and organized businesses can arise in the future. Adults should learn to comment 10 ways to make a certain idea grow and succeed than giving 100 reasons why it would fail. Even though any business idea has a risk and challenge, through optimism, hard work, commitment and great leadership one can overcome the problems and give a more durable solution. Of course in order to develop these mindsets, our society needs to involve the youth in decision makings because great leadership actually starts at home.

Gedion Yitbarek, an Engineering student at the University of Oklahoma, is Director of Operations at the Ethiopian Global Initiative and President and Founder at EthioCinema LLC


  1. This is such an amazing article and it speaks to the things I hold steadfast. Ethiopia's youth need to be more prepared for leadership! Great work, Gedion!

  2. Michael HailemariamOctober 11, 2010 at 9:58 PM

    I like how you trace back the challenges with corporate leadership to universities. The main challenge with the Ethiopian youth in Ethiopia, as many corporate personnel explain, is a problem of discipline. If you look at the most problematic factors for doing business on the latest global competitiveness report for Ethiopia, poor work ethic is one point below corruption. I believe the cause is that the youth is highly sensitive to criticisms, and has no experience in managing failures in school. Although our age factor plays a major factor in this attitude, it is a point of concern for any investor when the youth thinks he/she knows it all. So, adults need to list the 100 ways of failures with the 10 positives because the reality is 90% of the business ideas are bad.

    On the other side, adults have eschewed the practice of business with some form of social failure, and something the Gurage do. Even my grandmother, who comes from a family of entrepreneurs in Sodo, actively discouraged my mother from the business world. She wanted her children to finish college, and have ‘normal’ professions. My mother went on to start her own business to my grandmother’s dismay. Yet both my grandmother and my mother paint a gloomy picture of doing business in Ethiopia. One ponders then, if these successful individuals are not so optimistic, why should I aspire to be an entrepreneur in Ethiopia. I think your carnival experience speaks to the general challenge of doing business and getting people to believe in your idea, but as an Ethiopian youth, it is daunting when you have no home grown support, as is the case in many families in Ethiopia.

    I also want to point out a positive recent development. The high flux of recent graduates into the workforce with little if any job opportunities has led the youth to take business venture ideas seriously. This turn of events can be a force in the next 5 to 10 years, making our generation resilient against the wave of global economic crisis. MH

  3. Hi I really enjoyed reading your article. I think you might also enjoy reading some similar content on the community: . Thanks!


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