Across Africa, over 80% of economic activity happens in the informal sector—a sprawling, adaptive, and often underestimated engine of resilience. From open-air traders and boda boda riders to informal manufacturers and micro-retailers, these entrepreneurs operate with no formal payroll, no HR department, and little institutional backing.
And yet, they lead teams, build loyalty, manage crises, and create value daily.
For startup founders, SME owners, and ecosystem builders, there are powerful leadership lessons to learn—not in boardrooms, but in markets, roadside kiosks, and informal workshops. These leaders don’t call themselves CEOs, but they’ve mastered the art of surviving and scaling in high-risk environments.
Lesson 1: Lead through trust, not title
In the informal sector, there are no org charts or employment contracts. Influence is earned by showing up consistently and delivering value.
Why it matters: People follow leaders who listen, protect their interests, and model commitment—not just those with authority.
Startup takeaway: Leadership isn’t about hierarchy—it’s about credibility. Build trust by being visible, responsive, and transparent.
Lesson 2: Know your people, not just their role
Informal entrepreneurs know their team members deeply—who needs to leave early to care for a child, who struggles with transport, who’s good under pressure. They lead with empathy.
Why it matters: In low-resource settings, emotional intelligence builds team cohesion more than formal incentives.
Startup takeaway: High-performance teams thrive when people feel seen and supported—not just evaluated.
Lesson 3: Manage risk with agility, not perfection
Informal leaders navigate daily volatility—currency shifts, supply chain breaks, weather disruptions. Instead of overplanning, they adjust in real-time.
Why it matters: Agility beats rigidity in uncertain environments.
Startup takeaway: Don’t wait for perfect information. Make small decisions fast, learn, and adapt.
Lesson 4: Empower informally, reward immediately
When things go right in the informal sector, rewards are direct—cash tips, extra hours, public praise. People know when they’ve done well.
Why it matters: Immediate recognition reinforces ownership and accountability.
Startup takeaway: You don’t need a performance review system to show appreciation. Small, timely gestures go far.
Lesson 5: Grow through relationships, not just capital
Market vendors and informal manufacturers often scale not through loans, but through trust—borrowing stock from suppliers, getting referrals from loyal customers, hiring through word of mouth.
Why it matters: Social capital drives scale when financial capital is scarce.
Startup takeaway: Build community before you chase growth. Your network is your infrastructure.
Lesson 6: Lead by doing
In the informal sector, leaders sweep the floor, carry the goods, and negotiate with customers. They lead from the front.
Why it matters: Visibility and shared labor inspire respect and loyalty.
Startup takeaway: Be willing to do the hard work yourself—it sets the tone for the entire team.
Why these lessons matter now
As startups and formal businesses grow across Africa, many are rediscovering what informal leaders have long understood: leadership is local, human, and adaptable.
In high-uncertainty environments, people follow those who can balance vision with empathy, structure with flexibility, and authority with humility.
And that’s exactly what the informal sector has been modeling all along.
Final thought: there’s more to leadership than LinkedIn
If you want to understand real leadership in Africa, don’t just read business books—spend a day in a market, a repair shop, or a food stall. You’ll find grit, creativity, people management, and long-term strategy—all in motion, often without any formal labels.
Sometimes the most valuable leadership lessons aren’t taught—they’re lived.
About the author
Aurel Kinimbaga is a contributor specializing in innovation, business strategy, and inclusive growth in Africa. He writes on entrepreneurship and the economic trends shaping the continent’s future.
