What is a healthy entrepeneurial ecosystem? Answer + application to the Netherlands
Text of Healthy Entrepreneurial Ecosystems
A Healthy Entrepreneurial Ecosystem Workshop Entrepreneurial Ecosystems, Utrecht, 14 July 2014 Prof Dr Erik Stam
NL employment of the 5 largest multinational firms, 1985-2012 (-74%) 0 10000 20000 30000 40000 50000 60000 70000 80000 1985 1997 2003 2007 2012 Philips DSM AKZO Shell Unilever
Outline I. Entrepreneurial Ecosystem concept II. NL situation: Entrepreneurship Paradox III. NL policy
I. Entrepreneurial Ecosystem Concept
A Healthy Entrepreneurial Ecosystem? An entrepreneurial ecosystem is an interdependent set of actors that is governed in such a way that it enables entrepreneurial action
Entrepreneurial activity Entrepreneurial Ecosystem Elements
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Innovative start-ups High-growth start-ups Entrepreneurial employee activity Productivity Income Employment Well-being Support services / intermediaries Value creation Outcomes Outputs Entrepreneurial activity Entrepreneurial Ecosystem Elements
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Support services / intermediaries Entrepreneurial Ecosystem Elements The framework conditions that enable/constrain the development and interaction of actors in the entrepreneurial ecosystem
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Support services / intermediaries Entrepreneurial Ecosystem Elements Hermann Hauser - Cambridgeshire
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Support services / intermediaries Entrepreneurial Ecosystem Elements
II. NL situation: Entrepreneurship Paradox
A Healthy NL Entrepreneurial Ecosystem?
NL: Entrepreneurship Paradox Amazing growth of entrepreneurship in the Netherlands, 1987-2012 Miracle: no country in which the TEA rate has grown as much as in the Netherlands over the period 2003-2012 (and precourse of rising new firm formation and self-employment) Paradox: increasingly a matter of growing number of solo self-employed, and low/mediocre rates of growth-oriented entrepreneurship
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Innovative start-ups High-growth start-ups Entrepreneurial employee activity Productivity Income Employment Well-being Support services / intermediaries Value creation Outcomes Outputs Entrepreneurial activity Entrepreneurial Ecosystem Elements NOT SELF-EMPLOYMENT & NEW FIRMS PER SE
Self-Employment & New Firms, NL
Solo Self-Employed & Employers, NL
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Innovative start-ups High-growth start-ups Entrepreneurial employee activity Productivity Income Employment Well-being Support services / intermediaries Value creation Outcomes Outputs Entrepreneurial activity Entrepreneurial Ecosystem Elements NOT SELF-EMPLOYMENT & NEW FIRMS PER SE
0 1 2 3 4 5 6 7 8 9 10 11 12 Belgium Germany Netherlands Sweden UK Israel US Job growth expectations start-ups (2013) 20 or more jobs 5-19 0-5 Shareoftheadultpopulation
Rise of solo-self employment more relevant as condition for entrepreneurial ecosystem (culture), than as output But, might be indicator of lack of ambitions, and constrained labor mobility as well
(Eco)systemic Causes & Consequences Negative/no feedback No build up of system for high-growth start-ups (vicious circle high-growth start-up scandals early 2000s: Baan, World Online) a) Mobility of skilled labour: employment protection legislation, non compete clauses b) Capital market: VC, trade-sales, IPO c) Lack of venturesome demand: innovative procurement d) a)+b): Lack of serial entrepreneurs/informal investors No champion of intrapreneurship, like Nordic countries (in spite of high levels of trust, knowledge work, and decentralized decision making)
III. NL Policy
Towards a Healthy NL Entrepreneurial Ecosystem
Formal institutions Framework conditions Systemic conditions Culture Networks Leadership Finance Talent Physical infrastructure Demand New knowledge Innovative start-ups High-growth start-ups Entrepreneurial employee activity Productivity Income Employment Well-being Support services / intermediaries Value creation Outcomes Outputs Entrepreneurial activity Entrepreneurial Ecosystem Elements
Framework conditions changing formal institutions to enable labor mobility (development and circulation of talent); opening up public demand for entrepreneurs, to provide finance for new knowledge creation and application; stimulating a culture of ambitious entrepreneurship and entrepreneurial leadership; adapting or creating physical infrastructure to enhance knowledge circulation and networks.
Improved Monitoring of Entrepreneurial Ecosystem(s) National Regional Corporate
Regelgeving Cultuur Netwerken Leider- schap Finan- ciering Talent Fysieke infrastructuur Vraag Nieuwe kennis DV Bedrijven Noord-Brabant
Research agenda What is the effect of leadership, role models, mentoring on entrepreneurial activity? Relevant context(s)? Region, country, corporation, Relative weight, interdependence, and evolution of entrepreneurial ecosytem elements? Better measures
Conclusions Entrepreneurial ecosystem approach provides new insights for public policy and entrepreneurial leadership (leaders & feeders) Entrepreneurial ecosystem analysis as starting point for discussions about changing framework conditions and systemic conditions
A Healthy Entrepreneurial Ecosystem Workshop Entrepreneurial Ecosystems, Utrecht, 14 July 2014 Prof Dr Erik Stam
