As Ghana’s technology sector grapples with challenges in attracting significant international investment, the passage of the long-anticipated Start-up and Innovation Bill could mark a pivotal moment. Designed to create a structured framework to support innovation, this legislation has the potential to transform Ghana’s nascent tech ecosystem into a thriving hub for venture capital and innovation.
The bill’s renewed importance comes against the backdrop of concerning data: Ghana’s start-ups secured only US$68 million in funding in 2024, a stark contrast to Kenya’s US$638 million and Nigeria’s US$410 million. These figures not only reflect Ghana’s lag behind regional tech hubs but also underscore the urgent need for structural reforms to boost investor confidence and diversify the local startup landscape.
Why the Start-up and Innovation Bill Matters
The Start-up and Innovation Bill, which has been in draft form since January 2020, is more than just legislation—it’s a blueprint for fostering an enabling environment for Ghanaian start-ups. Richard Nunekpeku, Vice President-Legal and Strategy at the Ghana Fintech and Payments Association, highlights that passing the bill could catalyze the tech ecosystem, positioning Ghana as a competitive destination for global venture capital.
Among its core objectives, the bill aims to:
- Attract Venture Capital: Establishing a regulatory framework that assures investors of transparency and stability.
- Promote Governance and Compliance: Ensuring start-ups adopt good corporate governance practices to prevent scandals like the collapse of Dash in 2023.
- Support Ecosystem Diversification: Encouraging innovation in sectors beyond fintech, such as health tech, agritech, and clean energy.
Lessons from Kenya’s Success
Ghana can draw valuable insights from Kenya, often referred to as “Africa’s Silicon Valley.” Kenya’s deliberate efforts to establish a robust regulatory framework and diversify its tech ecosystem have paid dividends. In 2024, Kenya raised 29% of Africa’s total start-up funding—a testament to the benefits of a maturing fintech ecosystem, clean energy initiatives, and dedicated legislation like its Start-up Act.
For Ghana to replicate this success, a multi-pronged approach is needed:
- Regain Investor Confidence: Implement strong governance and compliance measures to rebuild trust.
- Diversify the Innovation Ecosystem: Move beyond payments-focused fintech to include agritech, health tech, and mobility solutions.
- Strengthen Regulatory Support: Pass the Start-up and Innovation Bill to provide the much-needed regulatory backbone.
Addressing Investor Confidence and Governance Gaps
The collapse of Dash, once a promising fintech start-up, highlights the fragility of Ghana’s ecosystem. Accusations of financial misconduct—including falsified growth figures and unsustainable overhead costs—have deterred investors and underscored the urgent need for robust governance frameworks.
To reverse this trend, start-ups must:
- Adopt Transparency: Implement accurate reporting systems to provide reliable data to investors.
- Strengthen Compliance: Build a culture of adherence to financial regulations and corporate governance.
- Collaborate with Experts: Engage with legal advisors, like CLG Plus, to ensure compliance and mitigate risks.
Expanding the Ecosystem: Beyond Fintech
While fintech remains a key driver of innovation in Ghana, the ecosystem’s over-reliance on payments-focused start-ups limits its growth potential. There is a pressing need to diversify into sectors like:
- Agritech: Addressing food security through smart farming solutions.
- Health Tech: Innovating affordable healthcare delivery systems.
- EdTech: Creating platforms to expand access to quality education.
- Mobility Solutions: Developing efficient transport and logistics systems.
Diversification not only attracts a broader range of investors but also ensures that the start-up ecosystem becomes more resilient and inclusive.
How CLG Plus Can Support Ghana’s Start-up Ecosystem
At CLG Plus, we recognize the transformative potential of the Start-up and Innovation Bill. Our flexible, on-demand legal services are designed to empower start-ups, investors, and ecosystem enablers. Here’s how we contribute:
- Regulatory Compliance and Risk Management:
- We help start-ups navigate Ghana’s evolving regulatory landscape, ensuring adherence to corporate governance and consumer protection laws.
- Our expertise in cross-border transactions enables start-ups to attract global investors confidently.
- Ecosystem Diversification:
- We provide tailored legal advice for start-ups in emerging sectors like agritech, health tech, and clean energy, helping them establish strong foundations.
- Investor Relations:
- By guiding start-ups in building transparent reporting systems and implementing financial accountability, we help regain investor trust.
- We facilitate legal frameworks for venture capital agreements, ensuring mutually beneficial partnerships.
- Capacity Building:
- Through partnerships with incubators and accelerators, we offer legal workshops and mentorship programs to equip founders with the skills needed to scale their businesses sustainably.
The Path Forward
Restructuring the Ministry of Communication to include digital technology and innovation is a promising step toward holistic development. By aligning government policy with start-up needs, Ghana can foster an ecosystem that balances innovation with consumer protection.
Beyond the Start-up and Innovation Bill, sustained investment in ICT infrastructure, public-private partnerships, and tech education will be crucial. Equipping young people with tech skills and expanding access to innovation hubs across the country can help unlock Ghana’s full potential.
With strategic legal support from CLG Plus, Ghanaian start-ups can position themselves for growth, resilience, and global competitiveness. Together, we can build a dynamic ecosystem that not only attracts investment but also drives meaningful, inclusive development.
Discover Legal Empowerment with CLG Plus
Embarking on business ventures in Africa or Germany? Let CLG Plus guide you through the legal intricacies. Our on-demand legal services cater to entrepreneurs, start-ups, and SMEs, ensuring your venture is fortified with expert legal advice. From immigration to tax, technology, and intellectual property, we cover all bases to support your multicultural business endeavours. Experience bespoke legal solutions that transcend borders – contact CLG Plus today for a consultation that will set your business on the path to success.