As any entrepreneur will tell you, it takes a village to raise a startup. But what does it take to create a nurturing ecosystem where new businesses can thrive? A new study by researchers from Washington University in St. Louis and the Kauffman Foundation takes a deeper look at the notion that entrepreneurial hubs emerge and succeed when they are surrounded by favorable support systems.
The paper, titled “Examining the Connections within the Startup Ecosystem,” is based on a case study of the St. Louis region, which has not been widely known as an entrepreneurial hub, but has seen a recent, substantial transformation of its local entrepreneurship ecosystem.
“Entrepreneurs clearly learn best from interacting with other entrepreneurs,” said Karren K. Watkins, Olin MBA’13, a research associate at the Skandalaris Center for Entrepreneurial Studies at Washington University.
“A strength of the St. Louis startup ecosystem is the extent to which entrepreneurs are connected with others – both peers in similar industries and stages of growth, as well as experienced entrepreneurs who can serve as mentors.”
The study explores key relationships among entrepreneurs, support organizations and miscellaneous connections to learn how different players interact with one another and how an ecosystem evolves in order to make public- and private-sector behavior more effective. It also analyzes how successful ecosystems have developed over time, particularly how they got started, to identify potential policy implications.
“Many regions would like to replicate the enviable culture that Silicon Valley and a few other areas of the country have created,” said study co-author Yasuyuki Motoyama, PhD, senior scholar in research and policy at the Kauffman Foundation. “This study points to the most effective infrastructure being one that allows startup company founders to learn from their peers and from experienced entrepreneurs within a highly evolved and interconnected system of support organizations.”
Among the findings, the report indicates that cooperation among support organizations has played a key role in the evolution of the ecosystem by connecting entrepreneurs at the right stage of a startup’s development with the right type of support, particularly from other entrepreneurs with specific expertise or experience.
The full study is available online here.
By Julie Hail Flory, WUSTL Newsroom
Media coverage of the research: Forbes.com, Inc.com
Image: Kauffman Foundation research