Establishing and maintaining a healthy entrepreneurial ecosystem has increasingly become a goal for governments and investors across the world.
Thousands of bright minds, from aspiring entrepreneurs to corporate moguls, are working to stimulate innovation and economic development in their regions. Although creating a sustainable entrepreneurial ecosystem is a top priority, it is not as easy as it sounds.
When you look at top established entrepreneurial ecosystems like those in Chicago, New York, Los Angeles, or Beijing, you realize that it took time to get where they are. The Silicon Valley, for instance, is the result of passionate tech entrepreneurs who were determined to propel the industry forward.
Successful ecosystems are not launched overnight with a big-money splash. It doesn’t work that way. Ecosystems that thrive are built over time through consistent grassroots efforts.
In this article, we will delve into how corporates can build a thriving entrepreneurial ecosystem by integrating a mix of elements into their strategy.
1. Work on your corporate leadership and management structure
Creating an entrepreneurial ecosystem requires a new economic view on communities, networks, and institutions. It’s often a shift from conventional economic thinking about businesses and markets.
For this reason, a startup that wants to make such a shift needs a clear strategic vision and strong leadership to support the cause. Having a couple of cheerleaders at the top to plant the entrepreneurial flag and have everyone moving in the right direction is what drives success. Entrepreneurial ecosystems within large enterprises boast of well-respected leaders that are committed to the cause, and most importantly, accessible to their teams.
Besides strong leadership, corporations must work on their management structure. It is almost impossible to develop an entrepreneurial ecosystem without participative management, open communication, and inclusive decision making.
The best management approach is implementing a decentralized structure as opposed to a hierarchical structure. All departments should have levels of autonomy to create solutions to problems they face and make decisions they deem best for their teams and the company at large.
2. Foster a collaborative culture
Both startups and large corporations looking to create a healthy entrepreneurial ecosystem must be open to collaboration within and beyond the enterprise. However, if you operate with the traditional me-first mentality, there’s a decent chance that the ecosystem will die quickly.
A great way to enhance the collaborative mentality in the corporate world is coming up with programs and initiatives that add value to the business. Ideally, these initiatives should focus beyond the firm by providing avenues for staff to try new things or new ways of working.
For enhanced collaboration, the firm should support external startup initiatives rather than having to build technologies from the ground up. By doing so, it becomes easier to keep up with the trends and innovation in your industry or local ecosystem.
3. Attract and inspire great talent
One element of a sustainable ecosystem is that it can access great talent to run the business. Even if you have capital, you need an equal balance of essential skill sets- from technology to digital marketing to growth strategy.
The right talent will support your ecosystem right from the seed stage to the subsequent growth stages. Otherwise, you risk flaming-out or even worse, making mistakes that might kill the growth of your system.
Other than talent, it is important to seek guidance from mentors, experienced leaders, and serial entrepreneurs. This is particularly important for first-time entrepreneurs who want to get up the corporate learning curve without repeating the same mistakes as their predecessors.
4. Widen your network
This is undoubtedly one of the most effective ways to propel an entrepreneurial ecosystem. No matter what type of market your startup operates in, you need to schedule events with top entrepreneurs in your region.
These could be venture capital associations, industry trade associations, entrepreneur networking groups, economic development groups, and so on. When you leverage the strength of like-minded people, it becomes easier to create connections that will push the ecosystem forward.
For instance, it would be wise to host a dinner with experts when launching a financial startup in New York. The same applies to growing an entertainment-related startup in Los Angeles. The bottom line here is that you should participate in events that create an open environment for sharing ideas, making connections, learning about opportunities, and building meaningful partnerships.
5. Boost access to financing options
It is important to mention the need for adequate financing. The greatest ideas and the best talent will be useless if there’s no capital to fund the vision.
While big corporations may not struggle due to a lack of funds, startups need to enhance their access to capital. Ideally, a startup should make itself attractive to different financing options, including individual investors, organized investor networks, crowdfunding, private equity firms, and venture capital firms, among other funding sources. What matters is keeping the cash flowing for continuous growth, especially at the early stages of the business.
6. Embrace a bottom-up mindset
For corporates to successfully create a sustainable entrepreneurial ecosystem, all stakeholders must change their mindset and mentality. As part of the company culture, ensure everyone embraces a bottom-up approach. This involves thinking big, starting small, and taking baby steps.
A general guiding principle for all entrepreneurial ventures is to create the connectivity essential for early success, then clear the path for future growth. By doing this, you can be sure to strengthen your ecosystem and keep the revenue flowing.
As you grow and create a strong entrepreneurial ecosystem, so does it become easier to scale. Companies with strong growth and productivity metrics will always receive funding regardless of the location they’re based. After all, even a sports franchise does not win corporate partnerships or sponsorships without star players or when on a losing record. Instead, the big things come after years of developing talent and showcasing their winning potential.
An entrepreneurial ecosystem is basically a group of interconnected and specialized organizations working together for the greater good of their community. It sounds simple, but putting these elements together is always a collective effort from passionate individuals. So, no matter where you’re trying to build a sustainable entrepreneurial ecosystem, use the above tips to make the challenge a success.
Author: Adela Belin