Ethiopia's Sovereign Wealth Fund Prepares to Launch Startup Incubation Program Within SOEs

Ethiopia’s sovereign wealth fund is preparing to launch an incubation program for startups across the 41 state-owned enterprises in its portfolio, according to Brook Taye (PhD), CEO of Ethiopian Investment Holdings (EIH). Brook announced the upcoming initiative, dubbed “Jump Start-Up,” during a fireside chat on the opening day of the three-day Capital Market Summit at the Addis Ababa International Convention Center.

He said each SOE will be able to select startups that align with its market needs and operational priorities. The chosen startups will be incubated for up to 18 months, receiving support directly from the respective SOEs. Successful ventures will then be eligible for funding from the sovereign wealth fund as well as from crowdfunding channels, he added.

“We are finalizing this program and will hopefully launch it very soon,” Brook said.

Brook expressed hope that Ethiopia’s first unicorns could emerge from the program. EIH has been expanding its footprint in the country’s startup ecosystem. In October 2024, it signed an MoU with electric bike startup Dodai to deploy 100 battery-swap stations in Addis Ababa, with plans to scale to 300 within three years. The agreement was terminated five months later, with EIH citing that a venture-capital fund structure would be better suited for risk management, targeted returns, and operational support for early-stage ventures.

Under the recently ratified Startup Proclamation, the upcoming startup fund of funds, designed to invest in early-stage companies, will have EIH holding the government’s interest. Its board will also be responsible for selecting the fund’s manager through a competitive process.

Amid Ethiopia’s constrained startup landscape, the “Jump Start-Up” program could become a pivotal intervention. By leveraging SOEs’ resources for incubation and combining sovereign capital with crowdfunding, EIH could stimulate the long-anticipated flow of investment and help early-stage companies overcome forex constraints and regulatory bottlenecks, possibly paving the way for the country’s first homegrown unicorns.