With the advent of the most hyped web summit to date, it is worth reflecting – based on solid research elsewhere – on the support for entrepreneurs and ‘ordinary’ businesses in Ireland.
Probably one of the most intelligent sources of research on entrepreneurship that I have come across in recent years emanates from the Kaufmann Foundation based in Kansas City, USA, says Billy Linehan of Celtar.
Dane Stangler of Kaufmann delights in challenging all of us in the enterprise support community – and Enterprise Ireland in our local context – by demolishing commonly held assumptions about
– small business and job creation
– the typical age range of successful entrepreneurs
– why governments and local authorities should stop trying to copy and re-create mini ‘Silicon Valleys’
– and that incubation centres are NOT effective in launching early-stage companies
I love this animated sketchbook, see it at
“There are several areas in which I think our research and the research of those we fund has been making headway in, if not disproving, at least pushing back against conventional wisdom or what turn out to be myths,” Stangler says in the three-minute animated video.
“Myth-busting Entrepreneurship,” notes four commonly held beliefs and attempts to set the record straight.
- Challenging the notion that small business plays the most important role in growing the economy, Stangler notes that the age of the firm is a more important variable than the size of the firm. “It’s new and young companies that create most jobs and innovations, not necessarily small companies,” he says. (This is accepted by most commentators in Ireland, except possibly ISME and the SFA?)
- He cites multiple studies that refute the popular stereotype that most entrepreneurs are 23-year-olds starting tech companies in their local coffee shop or their bedroom. “By and large,” he says, “the ‘peak age’ for starting a company is in the mid to late 30s, early 40s.” (majority of Enterprise Ireland startup support and PR has been targeted at young men in their 20s, though this is slowly changing)
- Stangler warns against efforts to recreate Silicon Valley in the hopes of creating a hotbed of high-tech startups. “Silicon Valley is a very unique place that’s never going to be replicated. We all need to stop trying to be a Silicon fill-in-the-blank, not just in the U.S., but anywhere around the world,” he says. (time for Enterprise Ireland, Dublin City Council, #startupireland and Dublin chamber of commerce to consider their approach to tech startups in Dublin?)
- More recently, Stangler and the research team at Kauffman have been examining the role of business incubators to launch early-stage companies. “Most research shows that incubators are not effective at all for actually producing companies,” he says. (politicians will loathe losing the opportunity and kudos of creating bricks and mortar incubation centres all over the country, and Enterprise Ireland and Forfas might review their relevant investment and job creation policies)
Stangler concludes by acknowledging the importance of harvesting more research to uncover myths and propose constructive alternatives.
State agencies, colleges and state funded quangos in Ireland must continually review their enterprise development policies, justify their expenditure and demonstrate on our behalf the return of their investments .
See more about the foundation at www.kauffman.org
Billy Linehan is MD of Celtar, business advisers, Ireland
Thank you for reading