Evaluating the Impact of a Business Accelerator for Small-scale Entrepreneurs in Kenya and Uganda

Last registered on June 22, 2022
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Pre-Trial

Trial Information

General Information

Title
Evaluating the Impact of a Business Accelerator for Small-scale Entrepreneurs in Kenya and Uganda
RCT ID
AEARCTR-0006577
Initial registration date
October 09, 2020

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
October 13, 2020, 9:20 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Last updated
June 22, 2022, 6:25 AM EDT

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Country
Kenya
Region
Country
Uganda
Region

Primary Investigator

Name
Juan Espinosa-Balbuena
Affiliation
Stanford University
Contact Primary Investigator

Other Primary Investigator(s)

PI Name
Stephen J. Anderson
PI Affiliation
PI Name
Frank Germann
PI Affiliation
PI Name
Sridhar Narayanan
PI Affiliation

Additional Trial Information

Status
On going
Start date
2017-06-01
End date
2023-06-30
Keywords
Firms & Productivity
Additional Keywords
Marketing, Entrepreneurship, Lean Startup, Product Experimentation, Customer Interaction, Firm Growth, Emerging Markets, Randomized Controlled Field Experiment
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Small businesses are important players in the enterprise ecosystems of emerging markets. Given this situation, researchers and policy makers have been examining how to lift certain constraints in the hopes of enabling small businesses to enhance performance and stimulate economic growth. In particular, the focus has been on the design of managerial capital interventions (e.g., training, mentoring, consulting) aimed at building entrepreneurs’ capabilities and confidence.
To understand the mechanisms and main effects of interventions that intend to improve the performance of small businesses, we propose to measure the impact of an innovative business accelerator that combines training and mentorship on ‘lean startup’ approaches with growth-focused financing for small-scale entrepreneurs in Kenya and Uganda.

Keywords: Marketing, Entrepreneurship, Lean Startup, Product Experimentation, Customer Interaction, Firm Growth, Emerging Markets, Randomized Controlled Field Experiment
External Link(s)

Registration Citation

Citation
Anderson, Stephen J. et al. 2022. "Evaluating the Impact of a Business Accelerator for Small-scale Entrepreneurs in Kenya and Uganda." AEA RCT Registry. June 22. https://doi.org/10.1257/rct.6577-2.0
Sponsors & Partners

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Experimental Details

Interventions

Intervention(s)
One key element of this business accelerator intervention is to help entrepreneurs to identify a profitable business model with less risk and more speed, thereby raising the chances of developing and scaling up a minimum viable product (MVP). For this purpose, the intervention focuses entrepreneurs on implementing ‘lean startup’ tools that emphasize product experimentation, customer interaction, field-testing and refinement to uncover customer needs/problems and obtain product-market fit as quickly as possible. The intervention also includes a financing component in which entrepreneurs leverage market/demand data – from their own experimentation and interaction activities – to ‘pitch’ to an investment panel for funding to grow the sales of their MVP.
Intervention Start Date
2017-09-15
Intervention End Date
2018-06-01

Primary Outcomes

Primary Outcomes (end points)
Main effects will be measured on firm sales, firm profits and an overall performance index.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
In addition, we will also try to identify the mechanisms or processes through which the intervention impacts firm sales and profits. In particular, we will focus on product experimentation measures (i.e., quantity, quality, and related outcomes) and also on customer interactions measures (i.e., frequency, intensity, and related outcomes).
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Our sample consists of 1,024 entrepreneurs. We used the sampsi command in Stata for our a priori power calculations. The baseline data was collected and verified for this set of firms (N = 1,024), and the participants were randomly assigned into two experimental groups:

1. Group 1 (Treatment): 512 entrepreneurs will be offered the business accelerator intervention, consisting of training and mentorship on ‘lean startup’ approaches, as well as the opportunity to pitch for growth-focused financing at the end of the program.

2. Group 2 (Control): 512 entrepreneurs will form a comparison group who do not receive any intervention during the study period.
Experimental Design Details
Randomization was conducted in ‘batches’ by location (4 cities in eastern Uganda and 4 cities in western Kenya). In each batch, randomization was stratified by operational status (1 = currently in operation; 0 = not yet operating) and happened at the individual firm level immediately prior to the scheduled intervention launch. During the intervention period (5-8 weeks), data was collected on all firms in the treatment group to assess intervention strength and compliance (as well as comparability across locations).
In terms of the logistics, we have completed the intervention period in all locations. To measure post treatment effects, we have implemented our first follow-up data collection round and, thus far, have been able to collect data for 6 of 8 locations. Given the COVID-19 measures recently taken by the Kenyan and Ugandan governments data collection in the remaining 2 locations has been halted temporarily. In our estimation, these data will be collected by December 2020.
Randomization Method
Randomization done on a computer, using statistical programming software (Stata; randtreat command).
Randomization Unit
The randomization unit is an individual firm/entrepreneur (N = 1,024 units).
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
14 batches
Sample size: planned number of observations
1,024 firms/entrepreneurs
Sample size (or number of clusters) by treatment arms
1. N = 512 in Treatment
2. N = 512 in Control
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials