Tunisia Set To Become A ‘Startup Nation’ – Parliament Passes the Startup Act
After two years of deliberation, the Tunisian Parliament passed the ‘Startup Act’ early this month. The Act was formulated by keeping the ecosystem involved and is touted to set the country on the path of becoming a startup nation.
Definition of a startup is chalked out clearly which states that the company should not have existed for eight years. Among other mandates, the number of its employees should not exceed 100, more than two-thirds of its shareholders should be founders and preference would be given to startups that leverage technology. The new rule does not insist a startup to be a ‘pure tech’ company but encourages usage of technology in operations.
The Startup Act comes with its bundle of benefits; it exempts startups from corporate taxes for up to eight years, special custom procedures, exemption from capital gains tax on investments made in startups, up to one year of time off from their current jobs (for both private and public sector employees), and salary for up to three founders during the first year of operations.
Tunisia has had to face slow economic growth since 2011 with a significant chunk of unemployed Tunisians. Inflation has been one of the major deterrents for investors coming in.
The situation is not that grim as it appears, despite having their challenges in a smooth functioning financial system, ecosystem enablers are slowly rising up to fill these gaps. The prominent names that are giving support to the startups are B@Labs, The 777 and Flat6Labs.
B@Labs offers an incubation program of 4 to 16 months for innovative startups. The program provides entrepreneurs a work-space, a complete curriculum and specialized workshops, mentoring and individual support, business and administrative services, access to the BIAT network and potential funding.
Flat6Labs Tunis is a startup seed program and an early stage fund. It also offers strategic mentorship, office space, a multitude of perks and services from partners, and entrepreneurship-focused business training and development workshops.
Startups too are not far behind in stirring up action in the ecosystem. Young companies like RoamSmart, AxeFinance, NukedCockroach, and Archiveyourdoc are introducing Tunisia with the new wave of entrepreneurship.
The other countries in Africa too are paving their path for constructing a conducive environment for startups to flourish. In Kenya, President Uhuru Kenyatta had hosted the Global Entrepreneurship Summit alongside Barack Obama, to open channels for US Investments. While in Nigeria the booming ecosystem in is need of such reforms, though the ecosystem enablers are playing significant roles in fetching investments.
On the other hand, India has seen tremendous stability in the Startup ecosystem after the incumbent government launched the StartupIndia initiative in 2016. Last week, the Indian government refined the definition of startup and put in place a mechanism for such companies to avail tax incentives under its startup policy.
With the coming in of the Startup Act in Tunisia, it will now be quite interesting to see where the ecosystem is headed and how soon the startups begin to contribute to the rising economy.
