Peter Gutwa Oino – Department of Sociology, Gender and Development Studies

Dennis Mamboleo – Department of Geography, Kisii University, Kenya

Abstract: Digital transformation has reshaped how small enterprises operate, yet differences in digital capability continue to influence the success of youth-owned enterprises in developing economies. This study examined the influence of digital capability on the performance of youth-owned socio-economic enterprises in Marani Sub-County, Kisii County, Kenya. Guided by the Technology Acceptance Model, the Resource-Based View, and Human Capital Theory, the study adopted a convergent mixed-methods design. Quantitative data were collected from 335 youth-owned enterprises using structured questionnaires, while qualitative data were obtained through interviews with enterprise owners and managers. Quantitative data were analysed using descriptive statistics, correlation, and regression analyses, whereas qualitative data were analysed thematically. The findings revealed a high level of digital capability among enterprise owners (composite mean = 3.96). Regression analysis showed that digital capability had a positive and statistically significant influence on enterprise performance (p < 0.05), with entrepreneurs reporting improved digital marketing, customer engagement, innovation, market expansion, and operational efficiency. Qualitative findings complemented these results, with participants explaining that digital skills enabled them toreach wider markets, reduce marketing costs, strengthen customer relationships, and respond more effectively to changing business conditions. However, respondents also highlighted limited employee digital skills as a major constraint to enterprise-wide digital transformation. The study concludes that digital capability is a strategic development resource that enhances enterprise competitiveness, youth livelihoods, and sustainable local economic development. It recommends strengthening digital entrepreneurship programmes, promoting workforce digital skills development, and integrating practical digital entrepreneurship training into youth enterprise support initiatives.