Impact Investing and Inclusive Business Development in Africa: A research agenda

Impact investing aims to create sustainable social and environmental impacts for investee enterprises and communities as well as adequate financial returns. As an attractive emerging market investment strategy, it involves development finance institutions and philanthropic foundations partnering with mainstream private venture capital to create impact funds with the goal of catalysing inclusive market-based enterprise development in low income countries. In this paper, we present findings from a scoping study discussing the nature and operations of impact funds in African economies and the associated research opportunities on this topic. To facilitate the assessment, we reviewed the existing literature on impact investing, considering this along three interrelated perspectives, namely 1) impact investing as development finance policy for economic development, 2) impact investing as a development in socially responsible investing, and 3) impact investing as capacity-building for inclusive business development in African economies. The interplay of these perspectives shapes the constitution and operational strategies of specific impact funds and provide a conceptual context for understanding impact investing at country level. Drawing on interviews, email exchanges and roundtable discussions with representative global and country-specific (Sierra Leone, Cameroon and Kenya) stakeholders our analysis makes three contributions to the impact investing debate. First we explore a model for understanding the ways in which impact funds are being channeled into inclusive businesses in Africa and the associated catalytic effects on poverty alleviation, social and economic development. Second we identified and tested access to, a range of impact funds and associated sector-specific inclusive businesses for future case writing – hopefully ‘failures’ as well as ‘successes’. Finally, we reflect on some of the unanswered managerial and policy-related questions that require a more rigorous inquiry-led appraisal to better understand and enhance the contribution of impact funds to inclusive business development in Africa

High Growth Firms in Scotland

High growth firms (HGFs) are widely thought to be a key force driving economic growth in modern advanced economies (Acs et al, 2008; BERR, 2008; Henrekson and Johansson, 2010). One of the central aims of the current economic strategy of the Scottish Government is to provide responsive and focused enterprise support to increase the number of highly successful, competitive businesses (Scottish Government, 2007). Hence, for the past decade there have been a number of policy initiatives designed to stimulate high growth entrepreneurship in Scotland. Many of these policies have had a strong technology focus. Given the importance these firms have for a region’s economic growth potential and the policy attention they are beginning to receive, it was felt to be important that Scottish Enterprise develops a deeper understanding of these important generators of wealth creation in the Scottish economy. This report examines HGFs in Scotland from both quantitative and qualitative perspectives

Networking Innovation in the European Car Industry : Does the Open Innovation Model Fit?

The automobile industry is has entered an innovation race. Uncertain technological trends, long development cycles, highly capital intensive product development, saturated markets, and environmental and safety regulations have subjected the sector to major transformations. The technological and organizational innovations related to these transformations necessitate research that can enhance our understanding of the characteristics of the new systems and extrapolate the implications for companies as well as for the wider economy. Is the industry ready to change and accelerate the pace of its innovation and adaptability? Have the traditional supply chains transformed into supply networks and regional automobile ecosystems? The study investigates the applicability of the Open Innovation concept to a mature capital-intensive asset-based industry, which is preparing for a radical technological discontinuity - the European automobile industry - through interviewing purposely selected knowledgeable respondents across seven European countries. The findings contribute to the understanding of the OI concept by identifying key obstacles to the wider adoption of the OI model, and signalling the importance of intermediaries and large incumbents for driving network development and OI practices as well as the need of new competencies to be developed by all players.Peer reviewe

Entrepreneurship and Innovation Strategies in ICT SMEs in Enlarged Europe (EU25)

Innovation strategies of entrepreneurs are mapped with growth and performance of their firms in this study. Findings of the study are based on the data collected from 1238 small ICT firms located in 25 member states of European Union. The survey was conducted during October 2006 and March 2007. Results of Logit analysis suggest that firms that pursued continuous innovation strategies experienced more employment growth, higher profitability, and better sales dynamics than those that adopted occasional innovation approach. Market growth of continuous innovating firms realized faster pace than other type of firms. Another distinguishing characteristic of two types of firms emerged is market preference. Target market of continuous innovating firms has been European or global markets while innovative activities of other firms targeted domestic market. The study concludes that European innovation policies should be focused towards continuous innovation activities with due attention at human resource development policies.dynamic capabilities, continuous innovation, occasional innovation, competitiveness, human resources, internationalization

Financing high-tech SMEs in China.

This thesis addresses a gap in the literature relating to the financing of technology-based SMEs in China, more specifically, it examines the sources and types of finance sought and used by high-tech SMEs in relation to the various stages of their development since China's 'reform and opening' in 1978. The central argument is that the development of high-tech SMEs in China has been strongly influenced by the availability of different sources of funding and the relationship between private enterprises and the banking sector in particular. The thesis analyses the financing of high-tech SMEs in relation to a three stage model of business development. It also draws upon concepts from institutional economies to interpret the changing relationships between high-tech SMEs and financial suppliers. The empirical evidence is based on the achieved 83 face to face interviews including 74 with owners/senior managers of high-tech SMEs and 9 with bank and government officials in the study region namely Guangdong and Guangxi. The results show that the ease of access to finance significantly varied through the three development stages. Internal finance and funds from individuate and private firms remained the key sources for high-tech SMEs at all three stages, with bank finance and venture capital yet to become significant sources at the start-up and early stages. A clear financial gap for medium and long-term funds was identified, placing a serious barrier on the ability of high-tech SMEs to invest in the R&D necessary for making radical and distinctive innovations at the start-up stage. Currently, the majority of Chinese high-tech SMEs are dependent on the application of existing advanced technology to products and services and rely on their low costs of production to compete with other high-tech companies

Constructs of Successful and Sustainable SME Leadership in East Africa

Despite the markedly increased foreign investment, East African economies remain characterized by low levels of investment and capital formation with high level of attrition amongst indigenous small and medium enterprises. While there is a high failure rate amongst these SMEs, some are beginning to turn the corner and are exhibiting signs of robustness, innovativeness and sustainability. Relying on narrative accounts of successful SMEs leaders in Kenya and Uganda obtained through interviews and focus group discussions, this study sought to construct an account of leadership practices and ascriptions of success for SMEs that had succeeded. The study identified eight leadership constructs characteristic of successful SME leaders in Kenya and Uganda grouped into visioning, building commitment, social capital, personal values, anticipation and resilience, resourcefulness, responsiveness, and entrepreneurial orientation. While these results, on the face value, are apparently not unique, it was in the nuances of the leadership practice that difference was made. In conclusion, the study highlights implications for these findings in relation to policy and leadership practice among SMEs