Amid the socio-economic challenges facing Lesotho, a quiet entrepreneurship movement is taking shape to confront long-standing issues of unemployment, sluggish private sector growth, and limited economic diversification.
This emerging wave of innovation is being propelled by the Competitiveness and Financial Inclusion (CAFI) project through the Lesotho Entrepreneurship Hub and Seed Financing Facility (LEHSFF).
This week, 15 dynamic, high-potential enterprises took centre stage as they pitched their ideas and business models to investors, venture capitalists and private-sector leaders at an event dubbed Demo Day.
The demonstration fitted a growing momentum in a national effort to unlock job creation and stimulate sustainable enterprise development.
CAFI, conceptualised in the aftermath of the Covid-19 economic downturn, is an ambitious initiative designed to revitalise the private sector and create an enabling environment for inclusive and sustainable economic recovery.
According to the Bureau of Statistics (BOS), youth unemployment stands at 39 percent, a figure worsened by the loss of more than 20,000 textile and clothing jobs following the pandemic. MSMEs and start-ups, which already lacked resilience to external shocks, were among the hardest hit.
Supported by the World Bank and operating under the Ministry of Trade, Industry and Business Development, CAFI responds directly to these economic disruptions by strengthening the entrepreneurship ecosystem and improving access to finance.
The Lesotho Entrepreneurship Hub, one of its flagship interventions, was established in June 2023 to support early-stage enterprises capable of generating jobs and contributing to economic transformation.
The hub’s demo day offered a platform to showcase progress made so far, particularly the incubation programme that has produced a pipeline of innovative, investment-ready businesses.
The 15 enterprises from the first and second cohorts pitched their solutions to an audience that included enterprise support organisations (ESOs), ecosystem partners, development agencies and private-sector representatives.
The hub consists of several components, including the establishment of a sustainable entrepreneurship facility, upskilling and certification of ESOs, integration of Lesotho’s start-up community into the regional ecosystem through partnerships such as AfriLabs and ABAN, and the development of a diaspora engagement programme to link Basotho abroad as mentors, investors or partners. Another key pillar is the recruitment of a fund manager to administer a M54 million Venture Capital Fund, which will support high-growth enterprises. An acceleration programme for 50 businesses is also in the pipeline.
So far, more than 200 enterprises have been incubated through ESOs that have been capacitated by CAFI. Over the next three years, the hub intends to incubate at least 300 more, pushing the total to 500 by 2028.
The demo day drew high-level attendance, including Prime Minister Samuel Matekane, cabinet ministers such as Trade and Industry Minister Mokhethi Shelile and Labour and Employment Minister Tšeliso Mokhosi, along with prominent private-sector figures and members of the diplomatic corps.
Addressing the gathering, CAFI’s Managing Director Chaba Mokuku described the event as a milestone in building Lesotho’s innovation capacity.
“Today, we are celebrating a key milestone. We are showcasing the Kingdom’s strong pipeline of innovative enterprises to the Nation and to the World,” Mokuku said.
He added that the hub will play a central role in accelerating 50 high-potential enterprises through the Venture Capital Fund.
“Over the next three years the Hub is expected to facilitate incubation of additional 300 or more enterprises, and this will bring the total to 500 by 2028. I should mention that CAFI Project prioritized youth and women owned enterprises,” he said.
On his part, Shelile said the enterprises demonstrated the country’s readiness to compete and diversify.
“Their presence here signals that Lesotho is not only open for business but ready to lead with bold ideas and competitive solutions. As such, as the Ministry responsible for Business Development, we are deeply committed to advancing economic diversification in line with the National Trade Policy and the National Export Strategy,” Shelile said.
Dr Dinara Djoldosheva, the World Bank Country Representative applauded the collaboration between stakeholders working to strengthen Lesotho’s entrepreneurial pipeline.
Among the notable enterprises on show was Pay Lesotho, a fintech company working to close gaps in digital payments.
“We provide a seamless payment infrastructure that enables businesses, government entities, and individuals to transact through mobile money, bank cards, POS devices and online platforms,” said Lerato Masupha. The company is seeking US$350,000 to scale operations and expand its product offerings.
Another promising enterprise was Iconics Clothing, a manufacturer of climate-ready tech apparel and modern corporate wear, including electric-powered jackets and cooling vests.
Summary
- CAFI, conceptualised in the aftermath of the Covid-19 economic downturn, is an ambitious initiative designed to revitalise the private sector and create an enabling environment for inclusive and sustainable economic recovery.
- Supported by the World Bank and operating under the Ministry of Trade, Industry and Business Development, CAFI responds directly to these economic disruptions by strengthening the entrepreneurship ecosystem and improving access to finance.
- The hub consists of several components, including the establishment of a sustainable entrepreneurship facility, upskilling and certification of ESOs, integration of Lesotho’s start-up community into the regional ecosystem through partnerships such as AfriLabs and ABAN, and the development of a diaspora engagement programme to link Basotho abroad as mentors, investors or partners.
Authored by our expert team of writers and editors, with thorough research.
