Youth and digital entrepreneurship: Dream or reality?

IN this era of technological advancement, online business has emerged as a viable and broad opportunity for Tanzanian youth to self-employ, earn income and even access international markets.

Platforms like Instagram, TikTok Shop and WhatsApp Business have transformed into digital marketplaces where trade happens without the constraints of physical storefronts or local taxes. But are these businesses just sweet dreams for a few, or a real path that can benefit many young people?

This article highlights the journey of Lucy Prosper, a young entrepreneur who has turned her dream into reality through online business. Lucy owns Zawadi Point, a business that creates and sells innovative gifts for various occasions such as birthdays, anniversaries and baby showers.

By leveraging Instagram and WhatsApp, she has transformed her creative talent into a source of income, acknowledging that social media is a powerful platform for quickly reaching many customers.

“Social media reaches a large audience without the high costs of physical rent. It also gives me a unique way to showcase my products,” Lucy explains.

Initially, her goal was simply to use social media to display her work, but the results exceeded her expectations. Her business is now known both inside and outside Tanzania, reaching countries like Kenya, the United States, India and Canada.

“I have customers from Arusha, Mwanza and even the diaspora through Instagram,” she says proudly.

Today, Lucy is proud to have a trusted brand, having won an innovation award in 2023, and enjoys a loyal customer base. This success is largely due to her ability to use social media not just as a marketing tool, but as a bridge connecting her to a growing modern market.

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However, challenges remain. Lucy admits that data costs, poor content creation tools and dishonest customers are daily hurdles. “Sometimes, a customer orders but never completes payment. It is discouraging,” she shares.

Despite these challenges, quitting has never been an option. For Lucy, entrepreneurship is more than business; it is a calling. “Love for what I do gives me the courage to keep fighting,” she says.

She believes that with effort, creativity and the right use of available resources, many young people can achieve their dreams through digital businesses. For Lucy, her success is clear proof that digital business is real, not just a fantasy.

She encourages other youths to start with what they have, be creative, understand their customers well and use social media wisely.

“Do not wait to have everything. Start with what you have, be creative, understand your customers and use social media effectively,” she advises. Answering whether online business is a pathway to success or a dream for a few, Lucy insists it is a very real path.

“It requires effort, honesty and creativity, but success is very achievable if you do not give up.” For Tanzanian youth, especially those in marginalised areas, digital business appears as a new bridge from unemployment challenges to new self-employment opportunities and participation in the global economy.

However, to make this digital dream a reality for many, close collaboration is needed among the government, private sector and civil society. If better environments are created, funding is accessible and digital education is widespread, it is no surprise to see Tanzanian youth leading Africa’s online business revolution.

In the digital age, the idea of “business storefront” expands from walls and doors to mobile phones and computers. What is needed now is courage, creativity and partnership. That digital dream, as exemplified by youth like Lucy, is becoming an everyday reality. For many, the journey to success might start with just one simple click: “Post.”

The pros and cons of digital business

An economist cum-investment banker, Dr Hilderbrand Shayo says undoubtedly, digital entrepreneurship in Tanzania is at a crucial stage, offering great potential to tackle youth unemployment. Nevertheless, it faces substantial economic and social challenges that make it seem out of reach for many young people, especially women.

The digital revolution presents a promising opportunity for digital entrepreneurship in Tanzania, offering youth a demographic advantage.

Tanzania currently has one of the youngest populations in Africa, with over 60 per cent of its people under 25. An abundant and dynamic workforce creates an environment ripe for innovation, gig opportunities and digital creativity, especially when traditional employment options are limited.

Dr Shayo says while Tanzania is well-positioned to benefit from the global digital revolution, significant structural and social obstacles continue to hinder meaningful participation in the digital economy. He says these initiatives have consistently harnessed the potential of the regional market.

Tanzania is strategically positioned within the East African Community (EAC) and AfCFTA, offering digital entrepreneurs access to a market of over 1.2 billion people. In this context, platforms can grow internationally more quickly than traditional businesses. When approached with a strategic mindset, digital entrepreneurship holds the potential to generate low-capital, highreach economic opportunities for young people,” Dr Shayo stresses.

Nonetheless, from a strategic perspective, digital transformation presents challenges and for many, it may still seem like a distant dream. Although phone ownership is high, digital literacy remains low, especially in rural areas. Coding, data analysis, design, digital marketing and platform management are mostly absent from most public education curricula.

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This prevents many young people from accessing financial resources. Many young individuals in Tanzania face difficulties in obtaining startup capital, bank accounts, or collateral needed for securing loans, as venture capital and angel investing are still relatively new in the region. Many startups rely on grants or self-funding.

The economist added that digital entrepreneurship is not a cure-all, but it can act as a powerful tool provided it is backed by comprehensive investment in skills, infrastructure and ecosystem development. Dr Shayo explains that digital businesses can access national or even regional markets that go beyond local foot traffic.

With platforms like Facebook Marketplace and TikTok, entrepreneurs can display their products to thousands of potential customers at minimal marketing costs. Achieving near-zero marketing expenses, efficient operations and data-driven decisions is entirely possible.

Digital tools such as inventory apps and POS systems help businesses monitor sales, inventory and customer behaviour in real-time. In this context, analytics support better pricing, targeted products and increased customer engagement.

Mr Albert Kagambo, a digital entrepreneur, shares that over the past eight months, he has been involved in online business, especially marketing and selling shoes through social media platforms like WhatsApp status, Facebook, Instagram stories and Instagram posts. He explains that this business model is more reliable and convenient than owning a physical store and has provided him valuable insights into the benefits and challenges of digital entrepreneurship.

“One major advantage of running an online business is flexibility. Since I don’t rent a shop or have a fixed location, I can manage my time efficiently and attend to other responsibilities,” says Mr Kagambo.

“Customers reach me directly via social media, place orders and I arrange delivery, often through bolt drivers. This setup reduces overhead costs like rent, electricity, security and staff, while keeping my business running.” He adds that online selling requires less physical effort.

“I can schedule product posts, reply to inquiries when I’m free and still earn income,” he says.

This is especially useful for young entrepreneurs balancing work, school or family. However, challenges include unreliable customers. Sometimes, customers order, promise immediate payment, but become unreachable after the product is dispatched, leading to losses and wasted time.

Payment collection can be difficult, as some delay or change their minds postorder, disrupting cash flow. Unlike physical stores where payment is immediate, online business depends heavily on trust, which can be fragile.

Mr Kagambo believes online marketing has great potential for young entrepreneurs but requires strategic planning, strong communication and adaptability to uncertainty. For anyone starting out, understanding both the flexibility and risks of online business is essential.