November 20, 2015

New Report Provides Six Tips for Promoting Entrepreneurship

As new research continues to shed light on the importance of entrepreneurship to innovation and economic growth, many policymakers continue to search for policies to help entrepreneurs induce such innovation and growth. Because the research shows that entrepreneurs tend to thrive in “ecosystems” with the right combination of interpersonal networks and support structures, policymakers are looking for ways to cultivate those systems.

A new report from the Kauffman Foundation suggests how they could do so. “Enabling Entrepreneurial Ecosystems,” offers six general strategies for states looking to foster and sustain entrepreneurial ecosystems.

  1. Favor incumbents less—avoid policies, like restrictive licensing requirements, that indirectly favor existing, dominant companies by creating entry barriers for new ones. 
  2. Listen to entrepreneurs—instead of developing policies in a vacuum, listen to what local entrepreneurs have to say about their challenges and use that insight to develop policies that address those challenges. 
  3. Map the ecosystem—chart the networks and connections that link entrepreneurs and their support organizations and use that information to identify, engage, and support entrepreneurs.
  4. Think big, start small, move fast—implement strategies that “seek domains for early success and rapidly iterate forward from there to build well-grounded programs at scale.”
  5. Avoid artificially segmenting your community and your strategies—recognize that members of an entrepreneurial community play many roles simultaneously (for example, a person may be working on his or her own venture while mentoring a new entrepreneur) and develop strategies that capitalize on the community’s diverse skills.
  6. Prepare to capitalize on crises—recognize that economic disruptions, like layoffs, create entrepreneurial opportunity, and find ways to help entrepreneurial communities make the most of them when they arise.