An “entrepreneurial ecosystem” is more than a buzzword, it’s the coordination of like-minded entities, individuals, or institutions to form a network to help create, grow, and sustain business development. Understanding and sustaining the ecosystem is critical for the long-term viability of both businesses and the broader community.
“An entrepreneurial ecosystem? Reminds me of biology class,” one my colleagues commented.
Well, yes, that’s a great comparison. And like biology, we should not isolate individual parts, but consider how the individual components relate to the broader system. Sticking with the biology analogy, we wouldn’t try to prevent a heart attack by simply taking aspirin, right? We would instead assess our overall lifestyle patterns, making necessary adjustments to our diet, stress levels, exercise routine, etc. Cultivating a business environment is no different—you are assessing and strengthening a system, loosely characterized by accessibility to: mentors, knowledge centers, like-minded partners (leadership), capital, workforce (talent), and the desirability of the city, town, or place in which you operate.
Over the last few years I have had the opportunity to both practice and study ecosystem formation in rural and urban areas. What I discovered is that some cities have utilized entrepreneurship as a redevelopment tool. These cities created an entrepreneurial movement by coupling engaged entrepreneurs with implementation-oriented entities; together they transformed their local economies.
For example, New Orleans went from being a declining urban economy to a hotbed of entrepreneurial activity because it embraced an ecosystem approach—addressing such things as place-based development, public-private partnerships, and access to capital. The city connected all the dots under the banner of entrepreneurship.
In fact, entrepreneurial thinking is slowly becoming part of the local culture and workforce. The work of organizations like IDEA Village has been pivotal (described in depth in an MIT journal article). And more recently, Tulane University has taken big strides in creating a multidisciplinary entrepreneurial curriculum that focuses on the triple bottom line, accounting for companies’ social, economic, and environmental impact. Tulane graduates now include entrepreneurs who specialize in launching businesses that return profits to both the company and the local community. Entrepreneurship is slowly becoming habitual and is now celebrated annually during New Orleans Entrepreneur Week (NOEW), just like JazzFest and Mardi Gras.
New Orleans isn’t the only city that has figured out how to connect the dots. Cleveland, Boulder, St. Louis, and Philadelphia are just a few examples of cities that have reinvented themselves through entrepreneurship. In fact, I was recently invited to attend the first Business Development Week in Beaumont, Texas. I was blown away by the array of partnerships, the topics covered, the varied demographics of the participants, and the amount of energy and enthusiasm generated for entrepreneurship and for Beaumont itself during this one week. Hopefully, Beaumont will also be able to sustain the ecosystem it has only just started to foster.
Without a doubt, urban planners, economic developers, nonprofit leaders, business executives and now policymakers are beginning to understand the interconnectedness of ecosystem networks and community growth. This sort of awareness, coupled with longer-term vision, is all the more important as we consider how these networks must constantly evolve to meet the needs of the community.
Government tools have traditionally responded to specific impediments that affect the entrepreneurial environment—addressing discrete challenges associated with a particular industry, such as access to capital, workforce, infrastructure, taxes, or other policy. But if we are to transform entrepreneurial landscapes, it will only make sense if government’s role evolves from managing individual parts to supporting the broader system. In recent efforts like Startup America, government played the role of convener, bringing together entrepreneurs, nonprofit leaders, and public-private partnerships to brainstorm solutions to sustain and accelerate small business growth. (The Office of Advocacy took part in several Startup America roundtables on reducing barriers to entry and the like.)
But what other roles can government play to evolve with the changing landscape? Tune into this discussion by following us on here and Twitter. Or post some of your own crazy ideas on how we can best construct entrepreneurial ecosystems.
—Caitlin Cain, Region VI Advocate
Caitlin Cain is the Office of Advocacy’s regional advocate for Arkansas, Louisiana, New Mexico, Texas, and Oklahoma. Prior to her work with Advocacy, she practiced economic development in New Orleans and surroundings for a decade.