Case Study: Building Tomorrows Entrepreneurs
CIDA City Campus revolutionised education in order to provide the first free (and therefore accessible) world-class degrees to disadvantaged, yet deserving, South Africans. Graduates aspired to join large companies on leaving the course. However the South African formal economy cannot absorb all graduates and, if they did, an opportunity would be missed to establish new, necessary forms of value in the economy by creating entrepreneurs.
In 2000, the challenge was set to build a parallel entrepreneurial track to support activity to create new value and jobs.
CIDA City Campus, based in Johannesburg, South Africa is recognised as a pioneer in 21st Century education. It offers talented students from historically disadvantaged backgrounds world class business degrees on a scholarship basis. Its vision is “A prosperous nation through relevant and affordable quality education”. http://www.cida.co.za
The university is innovative in a number of key ways:
- Social Goals: The University aims to achieve societal transformation by breaking inter-generational poverty. It does this through providing the opportunity for historically disadvantaged individuals to participate in Tertiary education. In addition, through its compulsory Extranet programme, it extends its impact by supporting students in up-skilling their local (often rural) communities through teaching entrepreneurship, HIV-Aids, money management, bio-intensive farming and other critical skills.
- Intensive curriculum: In order to provide both the remedial support required and a holistic, world-class degree, an intensive programme has been designed. Students start at 8am and attend 7-9 hours of lectures per day. They take three times the number of courses of traditional business institutions. Days at the university are divided into six components. They include: academic knowledge, life and business skills (e.g. technology), values (e.g. ethics), action (e.g. managing the campus, internships), self-management (e.g. meditation, counselling), extra-curricular activity (e.g. music, sport, etc.) and the Extranet (i.e. community outreach).
- Low cost operating structure: CIDA receives no direct government funding and provides free tuition, books, food and transport to its students. In order to ensure that the University can operate within these constraints:
- It is operated “by students for students”: Students perform multiple tasks incl. registration, cleaning, cooking, etc.
- Non-traditional teaching methods are used: World class lecturers are leveraged through technology to be able to interact with multiple classes at any time, whilst supported by facilitators in each class.
- Partnerships: CIDA has attracted international and local donors, however, beyond pure financial support it works with organisations to provide specific aspects of the curriculum e.g. PWC provides the finance curriculum, etc.
Since 2000, CIDA has, qualified over 1000 graduates in its primary offering of a Bachelor of Business Administration (BBA) degree.
“The education offered is designed to make students relevant, truly empowered, integrated citizens and leaders that are skilled and equipped to build the South African economy and society.” Thabo Mbeki
Economic dependence on entrepreneurs: It is clear, based on existing unemployment figures in South Africa and the high growth of the population under the age of 20, that there is an existing and future inability of the formal sector to absorb the growing labour force. Entrepreneurs create new wealth through creating new value and are fundamental for future economic growth. By creating jobs, they operate as multipliers in an economy.
“…entrepreneurs have been the driving force for growth in countries around the world.
Their ability to see opportunities, to see order amongst chaos where others see only issues, problems and disorganisation, has helped transform communities and economies.” Richard Branson
Social importance: On a national level entrepreneurs can support (directly and indirectly) developing solutions to both the poor performance against the millennium development goals and the vast gap (gini –coefficient) between rich and poor. On an individual level entrepreneurship empowers citizens, generates innovation and changes mindsets. On a macro level entrepreneurs can integrate developing countries into the global economy.
Failure in SA: Despite the obvious importance of entrepreneurship both economically and socially to South Africa, the country underscores on measures of entrepreneurship. The TEA Index (Total Entrepreneurial Activity) showed that South Africa’s level of entrepreneurship in 2008 was at 7,8%, lower than India-Brazil (11,5% – 12%), Colombia (24,5%), Mexico (13,1%) and even the United States (10,8%). On a macro level, education has consistently been identified as a primary inhibitor of entrepreneurial activity in South Africa. The 2001 GEM report showed that 65% of the expert informants identified problems with education and training as one of the three primary inhibitors of entrepreneurial activity in South Africa. To put this into perspective it is important to realise that, due to previous apartheid policies, in 1996 one in four black adults had had no access to formal schooling at all and only 6% of all South Africans had a tertiary qualification. On an individual level, very few young South Africans choose to start a business after their studies A myriad of reasons explain this, including lack of role models, no access to capital or training to help them identify viable business opportunities and the misconception that starting a business is for those who have no other choice. Corporate careers are still more desirable in South African Society. (GEM)
The School of Entrepreneurship was set-up to foster entrepreneurship. It aimed to develop entrepreneurs within the school, create new revenue streams for the school and extend the CIDA outreach programme to develop entrepreneurial skills in local communities.
This was envisaged through four main activities:
- Entrepreneurship curriculum: Provide students over a 4 year structured programme across business subjects that teaches them the methodologies, tools, skills and vision to pursue business ideas inside or outside a traditional corporate environment.
- CIDA Enterprises: An initiative that aims to work with the considerable resources and energies available to CIDA to provide revenue streams that can sustain the University into the future , provide practical entrepreneurial work experience for CIDA students and provide a resource center for students in running their own businesses. In addition, it would have a fund that could incest into relevant student ventures.
- Community Outreach: CIDA teach entrepreneurship in their communities as part of the extranet programme. This increases the impact of the programme nad supports students in internalising course knowledge
- Entrepreneurship hub: A new venture whereby CIDA will operate a business hub for inner city entrepreneurs. This will Act as a a basis for case studies as part of the academic curriculum, provide services for student businesses, earn revenue in the longer term for CIDA enterprises and contribute to inner city revitalisation.
CIDA aims to become known not just as a high quality provider of tertiary level business education but as an exemplar of innovation and a hive for talented young entrepreneurial leaders.
Key aspects to the business model:
- Revenue growth: To off-set the costs of the curriculum through developing additional revenue streams by setting up new CIDA companies (CIDA Enterprises). This included CIDA market research (based on unparalleled reach into rural areas), CIDA call centres and CIDA recruitment.
- Cost reduction: To reduce costs of operating through bringing in volunteers and structuring the courses around internships and in-role experience. To set-up partnerships e.g. with government and non-profit funders to provide necessary resources (CIDA Hub).
- Equity upside: To take equity in new ventures created both by the school and by its students for long-term gain.
Key Innovation Points
- Extensive use of experiential learning: The curriculum focussed on learning by doing and although participation was highly structured, it was in the form of facilitated activity, rather than ‘talking head’ lectures. This included: working alongside informal traders to understand their business model, developing business plans, taking internships in entrepreneurial companies and presenting to venture capitalists.
- Degree of Integration: On a strategic level the student’s entrepreneurial activities were integrated into the sustainability of CIDA by providing them with employment opportunities and the campus with additional revenue streams. Learning and doing were not separated.
- Support existing entrepreneurs: It was noted that there were already over 100 micro businesses on campus. These were supported and extended to meet campus needs and provide ancillary employment for students. They included a restaurant, a general retailer and a campus support services business (e.g. ink cartridge refills, supplying detergents and cleaning materials).
More than a decade on, the following have been achieved:
- Institutionalisation: The School of Entrepreneurship is now the Branson school of Entrepreneurship (since 2006), acting not only to develop CIDA entrepreneurs, but also others young people. Students are supported throughout their studies and then can enter the Branson School of Entrepreneurship business incubator upon completion of their BBA degree where they undergo and intensive entrepreneurship programme for 12-18 months. The School “has over the years been able to break the popular principle that setting up a business after school is for those who do not have a choice. It has bridged the gap of lack of role models, no access to capital or training that has overtime been an obstacle to willing entrepreneurs”. http://www.youtube.com/watch?v=Ys1OpjyA56s
- Entrepreneurs: While most graduates have gone to become successful business professionals in the corporate and public sector, while a few has opted to pursue social and business entrepreneurship. Sonwabile Mngenela, Lasego Malatsi Lonia Malatjie and Lazarus Seema are a few of the entrepreneurs launched by the School. Lonia Malatjie and Lazarus Seema talk about their experience of entrepreneurship. http://www.youtube.com/watch?feature=endscreen&v=qRvdOHbsKYw&NR=1 http://www.youtube.com/watch?v=u470waTZ-gg&feature=relmfu
- Recognition: Individuals have been recognised for their entrepreneurial activities: 2002 Taddy Bleacher received the WEF “Global Leader of tomorrow” award. In 2009 Mr James Wanjohi (head of the Branson School of Entrepreneurship at CIDA) was nominated as a Young Global Leader (YGL) for 2009 within the World Economic Forum. In 2006 CIDA received the Skoll Award for Social Entrepreneurship ($1m) to honour CIDA’s innovative approach to higher education and in helping find sustainable solutions to ending poverty in South Africa.
- Integrated practical curriculum: Entrepreneurship is offered as a course in the Foundation Year Programme and BBA degree. Whilst this includes: Knowledge of the discipline of entrepreneurship through formal academic coursework, in addition it offers:
- Mentorship and peer support through programmes designed to assist them in the early stages of business development
- Office space and services that will provide ‘incubator’ support for qualifying start-up businesses in targeted high-growth industries
- Training to enable them to go back to their communities to teach basic entrepreneurial skills during term time
- Access to a fund exclusively for CIDA students that will give them the seed capital they need to start micro-enterprises throughout the duration of their degree course. Qualifying graduates will also be able to access funding to get themselves off the ground.
Entrepreneurship in South Africa
Branson School of Entrepreneurship