With a few exceptions, both economic growth and job creation have been anaemic across Europe even before the current economic crisis. Moreover, unemployment is alarmingly high and continues to rise. A big reason for these problems is that Europe partially lacks a highly dynamic technology sector boosted by innovation-driven entrepreneurship.
Faced with strong global competition and high labour costs, Europe needs to reinvent itself. It will only be able to generate sustainable and significant growth through a relentless focus on a knowledge economy and particularly on enhancing the environment for high value-added innovation-driven entrepreneurship.
The Fostering Innovation-Driven Entrepreneurship in Europe project was established to deal with this challenge.
As the project report shows, this challenge includes persistent innovation divides between European economies as well as between Europe and other economies such as the United States. The project report suggests a forward-looking agenda that would contribute to Europe’s competitiveness and growth by creating an environment where ambitious serial entrepreneurs can envisage, create and scale innovation-driven ventures.
The project report had extensive input from the Forum’s Members, Global Shapers, Young Global Leaders, Network of Global Agenda Councils and leading policy-makers across Europe. Its findings have also benefitted from data gathered through 60 structured interviews and eight interactive workshops (in Bad Ragaz, Berlin, Brussels, Dalian, Davos, Geneva and London) as well as an online survey of entrepreneurs across Europe which gathered 1,132 responses.
As a result of this collaboration, four central ideas have emerged from the Forum’s work in this field.
1) Fostering innovation-driven entrepreneurship in Europe requires a comprehensive view of the entire entrepreneurial life cycle
The life cycle of an innovation-driven entrepreneurial venture can be divided into three phases – stand up, start up and scale up:
- Stand up – Promoting the attitudes and skills required for Europeans to have both the desire and ability to create scalable entrepreneurial ventures
- Start up – Gathering the resources to start a business, with a particular focus on access to capital for entrepreneurs across the European Union
- Scale up – Enabling ventures to scale, with a particular focus on collaborations that improve the innovation capacity of all partners to create growth and jobs across the region
Stakeholders have significant scope to positively influence external factors affecting each of these phases. Survey responses from across Europe show that participants perceive conditions to be most positive for the stand up phase. However the scale up phase is seen as far more challenging for European entrepreneurs, with only 41% of respondents saying that conditions are favourable in their country, compared to 63% of North American respondents.
In each phase of the life cycle, challenges and examples of practices have been identified to foster entrepreneurship in a way that encourage serial entrepreneurs to interact with other economic actors, and to examine the factors that comprise a supporting environment for entrepreneurs to develop and scale ideas.
2) Policy-makers, business leaders and individuals are significantly motivated to improve the conditions for entrepreneurship in Europe
The project report summarizes contributions from the highest levels of policy-making, including European heads of government, senior ministers and European commissioners:
The contributions show that leaders in the public sector are well aware of the need to foster innovation-driven entrepreneurship, and that a large number of relevant priorities are already on the policy agenda. These include interventions to tailor education to the needs of entrepreneurial careers, improve access to finance, enhance the availability of and access to relevant talent, and create better conditions for cross-stakeholder or cross-regional collaboration between different actors. In addition to these efforts, private actors are very willing to contribute. An overwhelming majority of survey respondents (87%) said they would personally support initiatives in their countries, such as the provision of educational or financial opportunities for prospective entrepreneurs. Further, a number of leading multinationals are actively incorporating support for entrepreneurs into their business activities in order to harness the innovation capabilities of new ventures and to engage with local communities in new ways.
3) To more effectively and efficiently support innovation-driven entrepreneurship in Europe, stakeholders need to focus, connect and partner.
Focus: We need explicit criteria to identify and invest in momentum-building entrepreneurship initiatives.
Connect: In order to overcome the challenge of fragmented European markets and entrepreneurial support services, we need to create better and new connections across countries, sectors and programmes. A more transparent, inclusive and Europe-wide database and network of initiatives would greatly assist in promoting innovation-driven entrepreneurship.
Partner: Stakeholders must be encouraged and supported to collaborate across initiatives, regions, organization types and sectors to achieve scale and momentum for new ventures and ideas. It is not enough to support innovation in isolated sectors – Europe needs to create an environment that will support innovation across government and business.
4) Supporting innovation in isolated sectors is not enough – Europe needs to create ecosystems that will support innovations emerging in unconventional ways across government and business
Entrepreneurial ecosystems are deeply affected by technological and cultural developments. As digital infrastructure and its applications for enterprises continue to develop, the transaction costs of collaborations will decrease and different sectors will find it easier to adopt new ways of working. The project report therefore presents two visionary pieces on the future of government and corporate innovation, laying the foundations for further discussion on how Europe can create an environment that is conducive to innovation and attuned to the breakthroughs yet to materialize.
The project has been carried out in collaboration with A.T. Kearney and has been built around:
- European leaders in the entrepreneurship space from the Forum’s communities of Young Global Leaders, Global Shapers, Technology Pioneers and Global Growth Companies
- Members of the Forum’s Investors Industry Partners Community
- Members of Global Agenda Councils on Europe, Fostering Entrepreneurship and on Design & Innovation
- The European Young Innovators Forum
- Other leaders from areas that shape the environment for technology and innovation-based entrepreneurship, including leaders from established multinationals, leading academic experts and public policy leaders
- Tools for better innovation management support developed under the leadership of A.T. Kearney and offered by the IMP³rove – European Innovation Management Academy
Nicholas Davis, Director, Head of Europe
Tel.: +41 (0)79 469 8548
Thorsten Jelinek, Associate Director, Europe Membership
Tel.: +41 (0)79 716 0004