20140714 stam_dutch_entrepreneurial_ecosystems

A Healthy Entrepreneurial Ecosystem

Workshop Entrepreneurial Ecosystems, Utrecht, 14 July 2014

Prof Dr Erik Stam

Outline

I.  Entrepreneurial Ecosystem concept II.  NL situa6on: 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 acDon

Entrepreneurial ac6vity

Entrepreneurial Ecosystem Elements

Formal ins6tu6ons

Framework condi6ons

Systemic condi6ons

Culture

Networks Leadership Finance Talent

Physical infrastructure

Demand

New knowledge

Innova6ve start-‐ups

High-‐growth start-‐ups

Entrepreneurial employee ac6vity

Produc6vity Income Employment Well-‐being

Support services /

intermediaries

Value crea6on

Outcomes

Outputs



Formal ins6tu6ons

Framework condi6ons

Systemic condi6ons

Culture



Demand

New knowledge

Support services /

intermediaries


The framework condiDons that enable/constrain the development and interac6on of actors in the entrepreneurial ecosystem

Formal ins6tu6ons

Framework condi6ons

Systemic condi6ons

Culture



Demand

New knowledge

Support services /

intermediaries


II. NL situa6on: 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 forma6on and self-‐employment)

•  Paradox: increasingly a maZer of growing number of solo self-‐employed, and low/mediocre rates of growth-‐oriented entrepreneurship

Formal ins6tu6ons

Framework condi6ons

Systemic condi6ons

Culture



Demand

New knowledge





Support services /

intermediaries

Value crea6on

Outcomes

Outputs



NOT SELF-‐EMPLOYMENT & NEW FIRMS PER SE

Self-‐Employment & New Firms, NL

Solo Self-‐Employed & Employers, NL

Formal ins6tu6ons

Framework condi6ons

Systemic condi6ons

Culture



Demand

New knowledge





Support services /

intermediaries

Value crea6on

Outcomes

Outputs



NOT SELF-‐EMPLOYMENT & NEW FIRMS PER SE

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Belgium Germany Netherlands Sweden UK Israel US

Job growth expecta6ons start-‐ups (2013)

20 or more jobs 5-‐19 0-‐5

Entrepreneurial Employees

(Eco)systemic Causes & Consequences

•  Posi6ve feedback: virtuous circle (for self-‐employment!)

Changing preferences

Changing formal

ins6tu6ons

Lower entry barriers

Higher entry rates

+ Context: high labour protec6on, concentrated financial sector, + Shocks: 1997-‐2001 dot.com boom&bust 2008+ financial crisis

Rise of solo-‐self employment

•  more relevant as condi6on for entrepreneurial ecosystem (“culture”), than as output

•  But…, might be indicator of lack of ambi6ons, and constrained labor mobility as well

(Eco)systemic Causes & Consequences

•  Nega6ve/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 protec6on legisla6on, non compete clauses

b)  Capital market: VC, trade-‐sales, IPO

c)  Lack of venturesome demand: innova6ve 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 ins6tu6ons

Framework condiDons

Systemic condi6ons

Culture



Demand

New knowledge





Support services /

intermediaries

Value crea6on

Outcomes

Outputs



Framework condi6ons

•  changing formal ins6tu6ons to enable labor mobility (development and circula6on of talent);

•  opening up public demand for entrepreneurs, to provide finance for new knowledge crea6on and applica6on;

•  s6mula6ng a culture of entrepreneurship and entrepreneurial leadership;

•  adap6ng or crea6ng physical infrastructure to enhance knowledge circula6on and networks.

Improved Monitoring of Entrepreneurial Ecosystem(s)

•  Na6onal •  Regional •  Corporate •  …

Entrepreneurial Ecosystem Index NL

?

Entrepreneurial Ecosystem Index NL

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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 ac6vity?

•  Relevant context(s)? – Region, country, corpora6on, …

•  Rela6ve weight, interdependence, and evolu6on of entrepreneurial ecosytem elements?

•  BeZer measures •  …

Conclusions

•  Entrepreneurial ecosystem approach provides new insights for public policy and entrepreneurial leadership (leaders & feeders)

•  Entrepreneurial ecosystem analysis as star6ng point for discussions about changing framework condi6ons and systemic condi6ons

A Healthy Entrepreneurial Ecosystem

Workshop Entrepreneurial Ecosystems, Utrecht, 14 July 2014

Prof Dr Erik Stam

20140714 stam_dutch_entrepreneurial_ecosystems

Small Business & Entrepreneurship

knowledge work

innova6veprocurement

employmentprotec6on

ipo c lackofventuresomedemand

14july2014 profdrerikstam