Editors' Forum | Not enough done to encourage Jamaica's entrepreneurial spirit, says Joseph Matalon
While Jamaica is awash entrepreneurs of various incarnations, mostly called 'hustlers' - from the peanut vendor to the trinket makers, facilitators of business development have not done enough to nurture the country's entrepreneurial spirit, says businessman Joseph Matalon.
Entrepreneurship not nurtured
"I have always felt that Jamaicans are inherently entrepreneurial. But I don't think (that) over several decades we have done enough to nurture that entrepreneurial spirit in terms of the support that is provided to these entrepreneurs," cited Matalon, chairman of First AngelsJa.
Matalon was sharing his views as part of an Angel Investor Network panel at last week's Gleaner Editors' Forum.
What was critical to establishing angel investors locally, according to the highly successful businessman, is to create incubators in the accredited universities, among them the University of the West Indies, Mona; the University of Technology and Northern Caribbean University .
"It's a lot of work that needs to be done across a broad front; whether it's regulatory, whether it is education, or incubation.
And we tend to be a people that are interested in immediate gratification, so that hard slog of developing that ecosystem, is not likely to gain a great deal of attention or interest," said Matalon.
"And this won't happen neither from the politicians; they would be far happier to have a big press conference that they are establishing a $20-million venture fund and they don't know where the deals are coming from.
He said that it was vital that the politics start developing the country's entrepreneurial spirit in order to allow national economic growth to come full circle in a progressively sustained manner.
"The private sector in Jamaica is often criticised for not innovating and the fact is, typically, the source of these innovations comes from these start-up companies," reminded Matalon.
An angel investor (also known as a business angel, informal investor, angel funder, private investor, or seed investor) is an affluent individual, who provides capital for business start-ups, usually in exchange for convertible debt or ownership equity.
Interest rates way too high for SMEs
Businessman Joseph Matalon has said that targeting the universities as incubators will help to facilitate the growth and development of a new entrepreneurial class that can contribute meaningfully to economic growth and development in the Jamaica.
Data he cited showed that among its pairs, in the Caribbean and elsewhere, Jamaica, as a percentage of GDP, has the lowest level of domestic credit to the private sector. He is hoping that angel investing will help to turn things around.
He further reasoned that interest rates for small medium enterprises (SMEs) were way too high and were above the average of the comparatives they were looking at. First Angel Director Sandra Glasgow said that the investor network does not exist to provide funding for "mom-and-pop businesses" but to offer innovative business concepts with the sort of support that will enable it to grow and contribute to national development.
"Looking at the (investment) ecosystem, we are really focusing on companies that have the potential to grow into large businesses, employing people and generating revenues and profits, and contributing to the treasury, so we are not just here to fund mom-and-pop businesses; no, its really companies that have that potential to grow," Glasgow stated. To date, First AngelJa members have invested nearly US$817,000 (about J$101 million) and are the leading investor network in the Caribbean.