Uganda has no shortage of hackathons, accelerators, or training programmes for young entrepreneurs. What it lacks is money.
“Everyone wants to train you, accelerate you, but no one wants to invest in you,” says Ethan Bampeire, co-founder of Neexa AI. “And when they do, it’s usually very small cheques.”
His company is building an AI-powered sales agent that allows African businesses engage prospects, nurture them with follow-ups, and convert leads into paying customers around the clock. But in a country that drew only an estimated $18 million in venture funding in 2024, survival often depends less on technology than on sheer endurance.
That complaint is familiar across Africa, but in Uganda, it bites harder. Despite boasting one of the youngest populations in the world and a government that has repeatedly promised to support innovation, venture capital inflows into the country remain relatively small compared to those in Kenya, Nigeria, or South Africa.
A capital desert
The 29-year-old first tasted this mismatch when he raised his first cheque, $1,000 from a local incubator. “It was not hard, almost at all,” he recalls. “But it was also minimal, so as you’d imagine, its impact wasn’t felt enough. The support from the incubator was valuable, but money-wise, it didn’t move the needle.”
That experience mirrors the trajectory of many Ugandan founders. While donor-funded accelerators and innovation hubs in Kampala offer training, they rarely back it up with substantial funding. Bampeire believes this leaves founders trapped in a cycle of pitch competitions and mentorship sessions that are more ceremonial than catalytic.
International investors, he says, approach Uganda with caution. “They see virgin territory that’s yet to be understood, so they’re trading extra carefully. That’s pushed us to focus more on local investors.”
However, local capital presents its own set of challenges. Uganda’s financial system is still conservative. Banks prefer collateral-backed lending, while most wealthy individuals are more comfortable with real estate or treasury bills than risky technology bets.
A 2021 report by the International Finance Corporation (IFC) showed that less than 5% of local SMEs had ever accessed equity finance—a stark contrast to Nairobi, where local angels and syndicates are increasingly visible.
The mismatch between founder needs and investor appetite explains why even Uganda’s most prominent startups often lean on foreign backers. Tugende, which finances motorcycles for riders, has raised over $70 million in debt and equity from US and European funds, attracted by a market where boda bodas account for an estimated 1 million daily trips in Kampala alone.
SafeBoda, the once high-flying motorcycle-hailing app, secured backing from investors in Indonesia and the UK who saw parallels between Uganda’s two-wheeler reliance and Asia’s $30 billion ride-hailing boom. Yet despite these high-profile bets, international investors, he says, still approach Uganda with caution.
For younger ventures like Neexa AI, those pathways feel distant. “Focus on traction,” Bampeire advises other founders. “It’s the only currency that speaks louder than pitch decks in a market where money is scarce.”
Scarcity beyond money
Money is not the only scarce commodity. Building a team has proven just as challenging.
“Actual tech talent is scarce,” Bampeire says. “The majority of the good ones are already working for foreign companies.”
That talent drain is measurable. A 2022 National Information Technology Survey found that over 60% of Uganda’s top software engineers were contracted remotely by companies in Europe and North America. While those roles pay three to five times local rates, they leave startups scrambling for skilled hires at affordable costs.
The problem is not only technical skills but also mindset. “Critical thinking is underdeveloped locally,” Bampeire notes. “That makes it harder to build teams that can go beyond coding and actually help refine solutions.”
The shortage has forced some founders into hybrid strategies, recruiting young engineers and training them internally, while outsourcing more complex development to contract teams abroad.
Getting customers in an early market
Even when the product is built, the sales cycle is not straightforward. Many Ugandan businesses remain sceptical of new software, often relying on manual processes or Excel spreadsheets.
“You have to give live demos,” Bampeire says. “And you need to show them that companies like theirs, in Africa or globally, are already using similar solutions.”
This education-heavy sales approach slows growth and eats into already thin margins. Yet it’s essential in a market where trust in digital services is still developing. A 2023 GSMA report found that only 25% of Ugandan small businesses use digital tools beyond mobile money, compared to over 50% in Kenya.
For Neexa AI, the hurdle has been convincing SMEs that artificial intelligence can be more than a buzzword. The company’s pitch centres on practical automation, helping firms streamline repetitive tasks and analyse customer data. But getting businesses to try—and then pay—requires patience.
Lessons learned
If capital, talent, and customers are uphill battles, Bampeire insists the most significant lesson has been about speed. “Moving fast is a feature in a startup,” he says. “Ship fast, test the market, refine fast, repeat. Make the pivot as soon as you prove your assumptions.”
In capital-scarce environments, the temptation is to polish products endlessly before launch, waiting for the perfect moment. “That’s a trap,” Bampeire says. “You need to validate that you’re solving a real problem. It’s so easy to think you are, but until the market proves it, you’re just guessing.”
If he were starting again, he admits, he would temper his optimism. “I’d be more realistic about projections and expectations.”
Neexa AI is still in its early chapters, but Bampeire is under no illusions about the long road ahead. “Solve a real problem,” he says, when asked about the most critical mindset for Ugandan founders.
His reflections capture the essence of building in Kampala today: a blend of grit, improvisation, and trial and error. With limited capital, scarce talent, and a cautious customer base, Uganda’s entrepreneurs are compelled to develop resilience as a primary principle.
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