State of Social Enterprise Africa 2025

Barriers faced by social enterprises FIGURE 22 Lack of access to finance Lack of access to support services Cash flow Market competitiveness Limited public understanding/ awareness of social enterprises Lack of access to customers/markets Economic climate Limited organizational capacity Political/regulatory environment Staff skills Other55% 29% 28% 27% 26% 25% 24% 23% 19% 18% 4% Source: Survey data, World Economic ForumWhile social enterprises across Africa demonstrate a high potential to drive inclusive growth, create jobs and address pressing social and environmental issues, they face a complex array of challenges. No fewer than 87% reported significant barriers to growth or achieving objectives. The top five barriers were: lack of access to finance, lack of support services, cash-flow constraints, market competitiveness and limited public awareness of social enterprises. 2.1 Access to finance The lack of access to finance was ranked as the top barrier in all five focus countries. These challenges permeate all stages of enterprise development but become particularly pronounced during growth phases. While access to finance is a well-known barrier for businesses across Africa, the challenge is even more acute for social enterprises. In sub-Saharan Africa, 30.8% of firms identify it as their biggest obstacle, compared to 17.3% across all surveyed economies.68 This emphasizes that African firms experience this as a barrier more than firms in other regions. Among social enterprises in this study, the figure rises to 55%, underscoring that despite their role in driving inclusive development and job creation, social enterprises are disproportionately affected by a lack of capital. There are substantial financing gaps, particularly for enterprises in the “missing middle” – organizations too large for microfinance but too The State of Social Enterprise: Unlocking Inclusive Growth, Jobs and Development in Africa 42