The Internet Antenna of Silicon Savannah: How startups perceive the impact of internet services on the Nairobi business environment and enterprise development challenges

Abstract

In recent years Nairobi, Kenya has experienced internet diffusion at a rapid pace. At the same time, there has been the formation of a local startup ecosystem shaped by a growing number of startups, innovation clusters and support services, making Nairobi the main innovation hub of East Africa. However, the growth and productivity of startups are constrained due to a number of development challenges in the Nairobi business environment. This thesis examines how internet services can strengthen the developmental impact of startups. It answers how startups perceive internet services to influence the business environment of Nairobi and offer solutions to enterprise development challenges. Adapted versions of the new venture creation model and the extended Technology Acceptance Model shape the basis for understanding the perceptions of the Nairobi business environment, internet services, online education programs, online marketing platforms and online venture capital websites. Numerous in-depth interviews with startups, innovation clusters and experts, a survey among startups, secondary data and several observations have led to the conclusion that internet services have had a radical effect on how startups market, communicate, network and do business in Nairobi. Internet services are strongly perceived to contribute to market access, whereas the impact on human capital and competitiveness is recognized to a lesser extent. While it is the most pressing development challenge, access to capital has not improved as a result of internet services. The findings can be considered an exploratory step in comprehending the developmental effects of entrepreneurship and internet diffusion in present-day Nairobi. The perspectives of startups presented in this study will have an enduring influence on the development of new internet services and the future of Silicon Savannah.