Kenya is now among African countries with a Startup Act following the recent publishing of the Startup bill as an act of parliament. The new law will promote innovation, facilitate investments and provide a legislative framework to guide the formation of incubation centres by the national and county government.
Startups eligible for the incubator program will need to be registered in Kenya as companies, partnerships or Non-Governmental organizations. Interested startups should be less than seven years old since the date of registration, or ten years in the case of biotechnology ventures.
The Act dictates that startups interested in the county or national level incubator programs should have majority local ownership. Startups entering the incubation program should also attribute at least 15% of their expense to research and development activities.
The law will establish a registrar of startups, appointed by the Public Service Commission. The Registrar will maintain records of registered startups, their products, investments and financial needs.
Incentives in the Startup Act
The government may also establish a credit guarantee scheme to support the growth of startups. The scheme will offer financial support to startups and a guarantee for investors in startups.
Under the Startup Act, the Kenya National Innovation Agency will offer support in research and development, subsidize the formation of startups and facilitate intellectual property rights.
The Act will link startups to players in the private sector, research entities, investors and financial organizations.