Entrepreneurship Ecosystem
Encyclopedia
The Entrepreneurship Ecosystem refers to the elements – individuals, organizations or institutions – outside the individual entrepreneur that are conducive to, or inhibitive of, the choice of a person to become an entrepreneur, or the probabilities of his or her success following launch. Organizations and individuals representing these elements are referred to as entrepreneurship stakeholders. Stakeholders are any entity that has an interest, actually or potentially, in there being more entrepreneurship in the region. Entrepreneurship stakeholders may include government
, school
s, universities
, private sector
, family business
es, investors, bank
s, entrepreneurs, social leaders, research center
s, military
, labor representatives, student
s, lawyer
s, cooperatives, communes, multinationals
, private foundation
s, international aid agencies, and the like.
In order to explain or create sustainable entrepreneurship, one isolated element in the ecosystem is rarely sufficient. In regions which have extensive amounts of entrepreneurship (e.g., Ireland
, Israel
, Silicon Valley
, Route 128, Iceland
, etc.) many of the ecosystem elements are strong and typically have evolved more or less simultaneously. Similarly, the formation of these ecosystems suggests that governments or societal leaders who want to foster more entrepreneurship as part of economic policy must strengthen several such elements simultaneously.
In July 2010, the Harvard Business Review
published an article by Babson Global Professor Daniel Isenberg
entitled, “How to Start an Entrepreneurial Revolution.” In this article, Isenberg describes the environment in which entrepreneurship tends to thrive. Drawing from examples from around the world, the article proposes that entrepreneurs are most successful when they have access to the human, financial and professional resources they need, and operate in an environment in which government policies encourage and safeguard entrepreneurs. This network is described as the entrepreneurship ecosystem.
There are several key conditions that typically define a healthy ecosystem. The ecosystem:
To help global leaders understand and apply the benefits of entrepreneurship ecosystems, Babson College
, ranked #1 for the best entrepreneurship program founded the Babson Entrepreneurship Ecosystem Project (BEEP) in 2009, through its subsidiary Babson Global.
Business cluster – A business cluster
is a geographic concentration of interconnected businesses, suppliers, and associated institutions in a particular field. Governments often look to clusters to stimulate innovation and entrepreneurship in their region. When clusters are applied to entrepreneurship, experts agree governments should not seek to create new clusters, but rather reinforce existing ones.
Government
Government refers to the legislators, administrators, and arbitrators in the administrative bureaucracy who control a state at a given time, and to the system of government by which they are organized...
, school
School
A school is an institution designed for the teaching of students under the direction of teachers. Most countries have systems of formal education, which is commonly compulsory. In these systems, students progress through a series of schools...
s, universities
University
A university is an institution of higher education and research, which grants academic degrees in a variety of subjects. A university is an organisation that provides both undergraduate education and postgraduate education...
, private sector
Private sector
In economics, the private sector is that part of the economy, sometimes referred to as the citizen sector, which is run by private individuals or groups, usually as a means of enterprise for profit, and is not controlled by the state...
, family business
Family business
A family business is a business in which one or more members of one or more families have a significant ownership interest and significant commitments toward the business’ overall well-being....
es, investors, bank
Bank
A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
s, entrepreneurs, social leaders, research center
Research center
A research center is a facility or building dedicated to research, commonly with the focus on a specific area. There are over 14,000 research centers in the United States...
s, military
Military
A military is an organization authorized by its greater society to use lethal force, usually including use of weapons, in defending its country by combating actual or perceived threats. The military may have additional functions of use to its greater society, such as advancing a political agenda e.g...
, labor representatives, student
Student
A student is a learner, or someone who attends an educational institution. In some nations, the English term is reserved for those who attend university, while a schoolchild under the age of eighteen is called a pupil in English...
s, lawyer
Lawyer
A lawyer, according to Black's Law Dictionary, is "a person learned in the law; as an attorney, counsel or solicitor; a person who is practicing law." Law is the system of rules of conduct established by the sovereign government of a society to correct wrongs, maintain the stability of political...
s, cooperatives, communes, multinationals
Multinational corporation
A multi national corporation or enterprise , is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation...
, private foundation
Private foundation
A private foundation is a legal entity set up by an individual, a family or a group of individuals, for a purpose such as philanthropy. The Bill & Melinda Gates Foundation is the largest private foundation in the U.S. with over $38 billion in assets...
s, international aid agencies, and the like.
In order to explain or create sustainable entrepreneurship, one isolated element in the ecosystem is rarely sufficient. In regions which have extensive amounts of entrepreneurship (e.g., Ireland
Ireland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
, Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
, Silicon Valley
Silicon Valley
Silicon Valley is a term which refers to the southern part of the San Francisco Bay Area in Northern California in the United States. The region is home to many of the world's largest technology corporations...
, Route 128, Iceland
Iceland
Iceland , described as the Republic of Iceland, is a Nordic and European island country in the North Atlantic Ocean, on the Mid-Atlantic Ridge. Iceland also refers to the main island of the country, which contains almost all the population and almost all the land area. The country has a population...
, etc.) many of the ecosystem elements are strong and typically have evolved more or less simultaneously. Similarly, the formation of these ecosystems suggests that governments or societal leaders who want to foster more entrepreneurship as part of economic policy must strengthen several such elements simultaneously.
In July 2010, the Harvard Business Review
Harvard Business Review
Harvard Business Review is a general management magazine published since 1922 by Harvard Business School Publishing, owned by the Harvard Business School. A monthly research-based magazine written for business practitioners, it claims a high ranking business readership among academics, executives,...
published an article by Babson Global Professor Daniel Isenberg
Daniel Isenberg
Daniel Isenberg is a Professor of Management Practice at Babson Global where he established the Babson Entrepreneurship Ecosystem Project...
entitled, “How to Start an Entrepreneurial Revolution.” In this article, Isenberg describes the environment in which entrepreneurship tends to thrive. Drawing from examples from around the world, the article proposes that entrepreneurs are most successful when they have access to the human, financial and professional resources they need, and operate in an environment in which government policies encourage and safeguard entrepreneurs. This network is described as the entrepreneurship ecosystem.
There are several key conditions that typically define a healthy ecosystem. The ecosystem:
- Is tailored around its own unique environment – it does not seek to be something it isn’t, like the “next Silicon Valley”
- Operates in an environment with reduced bureaucratic obstacles in which government policies support the unique needs of entrepreneurs and tolerate failed ventures
- Actively encourages and invites financiers to participate in new ventures, but access to money isn’t without barriers for those planning new business ventures
- Is reinforced, not created from scratch, by government, academic or commercial organizations
- Is relatively free from, or is able to change, cultural biases against failure or operating a business
- Promotes successes, which in turn attract new ventures
- Often is supported by dialogue among various of the entrepreneurship stakeholders
To help global leaders understand and apply the benefits of entrepreneurship ecosystems, Babson College
Babson College
Babson College is a private business school located in Wellesley, Massachusetts near Boston.- History :Babson College was founded by Roger Babson on September 3, 1919, as the Babson Institute. It was renamed "Babson College" in 1969...
, ranked #1 for the best entrepreneurship program founded the Babson Entrepreneurship Ecosystem Project (BEEP) in 2009, through its subsidiary Babson Global.
Related Content
University-based Entrepreneurship Ecosystem – In academic settings, entrepreneurship ecosystems commonly refer to programs within a university that focus on the development of entrepreneurs and/or the commercialization of technology or intellectual property developed at the university level.Business cluster – A business cluster
Business cluster
A business cluster is a geographic concentration of interconnected businesses, suppliers, and associated institutions in a particular field. Clusters are considered to increase the productivity with which companies can compete, nationally and globally. In urban studies, the term agglomeration is used...
is a geographic concentration of interconnected businesses, suppliers, and associated institutions in a particular field. Governments often look to clusters to stimulate innovation and entrepreneurship in their region. When clusters are applied to entrepreneurship, experts agree governments should not seek to create new clusters, but rather reinforce existing ones.
External links
- Babson Entrepreneurship Ecosystem Program
- Babson Global
- MIT Entrepreneurship Center
- The Development of University-Based Entrepreneurship Ecosystems: Global Practices
- New Orleans start-ups and all that jazz
- Where Israeli Entrepreneurship Really Came From
- President Obama Can Make Start-Up America Succeed
- Can policy makers create an ecosystem for entrepreneurship?
- Dear President Medvedev: Stop Emulating Silicon Valley