How These Ugandan Justice Entrepreneurs Will Soon Be Impacting Thousands of Small Businesses

A narrow unpaved road in Bukoto, Kampala, leads to the African Innovation Centre where the Barefoot Lawyers are housed. Walking in, you are welcomed with a big smile by a small group of lawyers typing away behind their laptops, tablets and smartphones. Although the daily routine allows for lunch talks about the newest (political) scandals, most of the lawyers are nearly overburdened by a pile of inquiries, legal procedures and emergency cases that need urgent attention: ‘Please incorporate my business today otherwise it will be closed down by the authorities’.

Micro, small and medium enterprises (MSMEs) play a vital role in the development of the Ugandan economy. MSMEs collectively constitute about 90% of private sector production and employ over 2,5 million people. The results of a recent survey carried out with over 1800 MSMEs in Uganda highlighted that one fifth of MSMEs have not registered, and three quarters do not have a tax identification number (NATHAN, FSD & TNS, 2015 National Small Business Survey of Uganda). Around a quarter say they do not know how to register, or that it is too complicated to do so. Other issues include becoming an employer, getting permits, paying taxes (or not agreeing with the tax authorities), all manner of contracts, provision of permits and services, IP protection, etc. Hence, there is a huge opportunity to sensitize and provide these businesses with legal guidance in making their business sustainable.

The mSMEGarage is a spin off lead by Barefoot Lawyers that provides legal services – in various stages of their development – to micro, small and medium enterprises (MSMEs) in Uganda. Founded by Gerald Abila and Michael Kwizera, the mSMEGarage is aiming to reach over 1000 SMEs in its first 6 months. One thing that makes them innovative, is that they leverage on Africa’s growing social media penetration and use those channels to provide legal support. Timothy Kakuru is the Garage’s project manager, heading the operations and providing virtual assistance to its registered members through Facebook, WhatsApp and via their website. The website content is constantly being updated with new legal information on business registration, contracting, patenting, licensing, taxation and legal procedures. Users have to register in order to download template legal documents or book an appointment for a face-to-face consultation with a lawyer. In addition, four field executives – business analysts – work full time to approach small business owners at various locations in Kampala to ask about their legal needs and interest in registering for the mSMEGarage.

During my visit to the Barefoot Lawyers, I had the opportunity to meet some of mSMEGarage’s first clients. One in particular struck my attention. Tambula is a boda-boda-tracking company that launched in 2014 to increase safety and security for Kampala’s thousands of motorcycles – many of which end up in accidents or are violently mugged at night. The founders developed a new software that can track the location of their member-boda’s via geo-tagging and automatically generates reports when accidents occur through a smartphone application. It turns out that the MSMEGarage was indispensable in making their business grow to a success. As its founder Ivan explains: “The mSMEGarage walked with us all the way through incorporation and the development of designs that could stand patent protection worldwide. With this we have been able to get a Microsoft grant of 25,000 USD and have now reached thousands more boda-boda riders in the country.” Apparently, newly developed companies are in particular need of affordable legal advice which seems to be simply missing in Uganda. “A team as intelligent and versatile as at the SME Garage is quite difficult to find this side of Africa, that is rooted to the ground and particularly understands the hurdles of new businesses in Uganda.”

The mSMEGarage won second place during the HiiL Innovating Justice Awards 2015 with an investment of 20.000USD and access to HiiL’s networks and expert advice. Almost halfway down its validation phase, the Garage managed to set up its online platform, adopt materials to facilitate 295 SMEGarage-registrations in its first weeks, conduct 2 legal seminars to a big audience and provide customized legal information to dozens of its clients. “All the advice, workshops and insights from the HiiL team have been incredibly valuable, and it opened a new world of opportunities to us” said Michael, Lead Strategy and Product Development, following a week of intensive workshops in their office.

With the experience of working with the mSMEGarage for a few days, I return home with 3 main take-aways. First. Access to justice is as necessary for (small) businesses as it is for human beings. Countries’ economies that rely on an enormous market share of small (informal) businesses, need their growth in order to provide employment and nurture welfare. I saw many of them during my stay: and most had no clue about the law, had never heard of preventive legal procedures (contracts, patents or licenses) and had no idea where to turn to without the budget for an expensive lawyer. Imagine what we can accomplish if we provide that huge group of informal African businesses with legal advice.

Secondly: measuring the impact on (access to) justice of start-ups such as the mSMEGarage is a great challenge in an environment that is dominated by fast iteration cycles and very limited resources. In particular: an affordable and simple tool that can manage systematic impact measurement is virtually non-existent and such assessments often depend on unreliable indicators. However, demonstrating your impact is essential in attracting impact investors and partners. But the effects of improving access to justice (for businesses) will most likely only appear after a year or more during which time the business may have become sustainable.

Finally: in a country like Uganda, business growth thrives on trust. On most street corners in Kampala, entrepreneurs are trying to sell, offer, provide and survive. Most clients only return to the companies, shops and businesses that they have good experiences with and whose owner’s face they recognize. Although online penetration is growing at a staggering rate in Uganda, it also provides opportunities for conmen to provide scam-services that Ugandan people increasingly victimize. It turns out: a service like the mSMEGarage can only expand if its critical mass of customers knows, in fact experiences their services, and notices its added value.

Companies like the mSMEGarage are the future LegalZooms’ that will in fact provide affordable access to justice for most (small) business owners in African societies. Now is the time to start engaging justice entrepreneurs in societies where people are ready to innovate. The former Chief Justice of Uganda, Benjamin Odoki, said during the launch of HiiL’s Justice Needs Report that Kampala should soon be turning to become ‘the capital of justice innovation’. Barefoot Lawyers are the avant garde entrepreneurs of their society. Who follows next?