Cristina Fernandez @CristinaFern
Korea | Republic of (South Korea)
On Sunday, November 23, leaders of the Startup Nations (SN) network met for their annual Summit (SNS). Co-hosted this year by the Banks Foundation for Entrepreneurship and Startup Korea, the Summit gathered champions of 45 national and city initiatives to build startup ecosystems.
Diverse experiences from starting and scaling entrepreneurship support initiatives were shared from across the world. Here are the five common recommendations that emerged from the discussions among the Startup Nations peers:
1. Engage policymakers
A lot of entrepreneurship programs and initiatives focus exclusively on creating a culture more supportive of risk-taking at the grassroots level, and while it is true that an entrepreneurship ecosystem cannot exist without entrepreneurs, it is also true that there can’t be a critical mass of startups where there are high barriers to entry or bankruptcy is severely penalized. For entrepreneurs to have impact on the economy some basic systemic conditions need to exist, argued Hugo Kantis, co-author of the Index of Systemic Conditions for Dynamic Entrepreneurship: A Tool for action in Latin America, at the Summit in Seoul.
So policy matters. A lot. The growing footprint of the rather recent Startup Ireland movement, for example, has come about in part because its co-founders engaged Parliament and Ministries in the early stages of the initiative.
To ensure more than lip service, SN members agreed that finding policy advisors within government who really understand entrepreneurial dynamics is key for an ecosystem to build muscle. Doug Rand, assistant director for entrepreneurship at the White House Office of Science and Technology Policy, for example, was key in articulating and implementing President Obama’s Startup America initiative. As a successful entrepreneur himself in the publishing industry, he was able to bring new perspectives to government, such as the concept of policy experimentation and lean solutions. As he explained to the SN audience in Seoul, the United States is currently experimenting in crowdfunding to make capital more democratic and enlarge the investor pool.
Rand recommended that governments incorporate “entrepreneurs in residence”. This approach was helpful to the U.S. government in developing a startup culture within the public sector. The Obama administration recruited entrepreneurs who developed solutions to fix broken immigration system for high-skill entrepreneurs. The Entrepreneur Pathways platform resulted as one of the minimally viable products, he said.
The Summit also featured entrepreneur in the public sector Felipe Matos, who the Brazilian government recruited as chief operating officer of Start-UP Brazil, and close advisor to city, regional and national Colombian policymakers Luis Florez.
2. Challenge misconceptions to avoid narrowing your target community
Bridgette Beam, Senior Partnerships and Program Manager at Google for Entrepreneurs, highlighted the value of diversity in building communities of entrepreneurs. That is the reason why Google’s initiative is called “Google for Entrepreneurs” rather than “Google for Startups”, she pointed out.
The sentiment was echoed by many delegates, including Ivan Sandjaja, who as director of Startup Indonesia was careful not to default into an initiative around tech startups since only about a third of the Indonesian population has access to the internet.
Jonathan Ortmans, co-founder of Startup Nations, reminded delegates why the word “startups” became a buzzword: around the world, and particularly in the United States, engaging policymakers required using the word “startups” to help distinguish entrepreneurs from small business owners.
Understanding the inherent diversity in entrepreneurship avoids creating a selection bias where programs attract those who already have some level of entrepreneurial exposure, rather than the larger pool of potential problem-solvers of different ages, backgrounds, and gender.
3. Rethink impact metrics
Despite new awareness and thoughtful efforts to measure impact to continually fine-tune a startup nation initiative, we have only seen the tip of the iceberg in terms of metrics of entrepreneurship, explained Dane Stangler, vice president for research and policy at the Kauffman Foundation. No data project so far has managed to capture the stages through which an entrepreneur passes after engaging in any of the programs that now abound around the world. For example, common metrics tend to ignore those who do not chose to start their own business immediately, but still have a new entrepreneurial lens that changes them regardless of the path they chose to take.
To tackle this challenge and get the process started, the Kauffman Foundation is supporting a new initiative called the Global Entrepreneurship Research Network (GERN). Phil Auerswald, GERN’s executive director announced, for example, a collaborative project between three GERN members -- Nesta, Endeavor Insight and MaRS -- to map 11 entrepreneurial cities around the world. The method and analytical tools resulting from this project will be open to everyone.
4. Focus on your ecosystem’s trajectory, not its rank
Valerie Mocker, Nesta’s Senior Researcher at the Summit, stressed that indices have a dual value: as research outputs that create an incentive for policymakers, and as tools that allow us to track an ecosystem’s trajectory. In terms of monitoring the progress in strengthening the ecosystem, the country’s trajectory is what really matters, Mocker explained.
Furthermore, as Startup Nations member from Barcelona Aleix Valls pointed out, indices do not account for industry verticals. For example, a biotech entrepreneur would choose Boston over Silicon Valley despite the fact that the latter is usually the top ranked ecosystem.
In sum, robust indices are useful guides rather than firm statements. It is important to recognize this in conversations so as to avoid political rejection among policymakers and discouraging dedicated volunteers in startup nation campaigns.
5. “Better recipes rather than just more cooking”
Dash Dhakshinamoorthy, co-founder of Startup Malaysia, expressed a common challenge: ecosystem players competing instead of collaborating. We need to improve recipes, rather than multiply existing strategies, he said. Mariano Mayer, director of Buenos Aires Emprende, also said his team had to actively face the challenge of transforming an “ego-system into an ecosystem”.
Donna Harris, founder of 1776 DC and former head of the Startup America Partnership (the private-sector arm of the government’s Startup America), recommended that Startup Nations leaders see their roles as catalyzers or facilitators in building communities. The local community-engagement effort was a key factor in the Startup America Partnership’s success in becoming self-sustainable within three years. Getting stakeholders to sign up to help strengthen the national ecosystem was a bottom-up-led effort, Harris explained. “Get the wheel turning and then step out of the middle,” she advised.
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