Understanding the platform practises of micro-entrepreneurs in Kenya

We talked to 27 micro-entrepreneurs in Kenya about how they use platforms (from social media sites to e-commerce marketplaces and online freelancing websites) in their day-to-day business. The platform practices these conversations revealed include: the prevalence of social media use, the intermingling of online and offline worlds, the adjustments made to tweak online credibility, and the unique approaches to upskilling. Platform product designers should build with these practices in mind. Our research aims to develop a deeper understanding of what it means to be a micro-entrepreneur in the platform era, and how the spread of platforms presents new opportunities—and challenges—for their economic and financial inclusion.

Background

The Internet is almost everywhere, and half the world is online. Platforms are a key fixture in the global Internet landscape. From messaging and content sharing in social media, to ridesharing, e-commerce virtual storefronts, and gig work, these platforms are transforming markets around the world.

Even small and informal enterprises in the developing world are caught up in platformization. If Google maps can “see” a tiny informal roadside tea shop, that tea shop is online, and could prosper by cultivating its online presence. If the African e-commerce platform Jumia lets an artisan sell a beautiful handicraft to a buyer 5000 miles away, that artisan (or at least, her competitor) is online and has to understand how to operate in a market where succeeding on Jumia can be the difference between subsistence and prosperity. For some microenterprises, platformization presents an opportunity. For others, it may be an unwelcome development.

In Kenya, the site of our study, there are roughly seven million non-agricultural microenterprises with less than ten employees that, in total, contribute roughly 30% of the Kenyan national output. From the enterprising 20-something who sells electronics over Jumia, to the juice saleswoman who teaches herself the latest juice-making techniques through YouTube, to the aspiring freelance writer who looks for assignments on Upwork, platforms are increasingly entrenched in the daily lives of micro-entrepreneurs in Kenya.

Takeaways and Next Steps

This study, conducted by The Mastercard Foundation Partnership for Finance in a Digital Africa (FiDA), shines a light on the cutting edge of microenterprises and platforms. It studies “platform practices,” highlighting how microenterprises have adapted to the changing, more digital marketplaces in which they act and how micro-entrepreneurs have created livelihood strategies that work for them. The project has three intended audiences, and we offer each a “takeaway” section with tailored action items and implications:

  • For those interested in building platform-based products and services to serve the micro-entrepreneur market, our results underscore that it is time to move beyond the false dichotomy of consumer apps and enterprise apps. The small enterprise, particularly the informal enterprise, has a unique set of business needs that platforms can address.

  • For development institutions (donors, foundations etc) interested in promoting broad-based economic and financial inclusion in the Global South, we document intervention points where platforms can be encouraged to better respond to the needs of micro-entrepreneurs.
  • And for the research community our study is one of only a handful that engages directly with how micro-entrepreneurs use platforms (not just “phones”, ‘ICTs”, or “the Internet”).

About the Research

This first part of the study is qualitative, based primarily on interviews and “digital day” exercises with 27 micro-entrepreneurs in Kenya. Every market is different, and just because the Internet is taking off among enterprises in Nairobi doesn’t mean it has been as widely adopted elsewhere in Kenya or  sub-Saharan Africa more broadly. But the stories we have encountered, the practices we have documented, and the enthusiasm that some of the micro-entrepreneurs we met have for life in the platform era are worth documenting. We hope these stories will inspire and illuminate practices that will continue to spread and evolve well beyond Nairobi.

Most of the text is available here as a downloadable, printable PDF report. But we’ve built this website to be browsable and readable on any device. There is no set order to the pieces. Read what you like. Get to know the micro-entrepreneurs and their platform practices. Be inspired. And figure out how you can help design products and services that make the Internet work better for businesses large and small, formal and informal.