Post on 06-Sep-2014
description
Growth-seeking entrepreneurship: The role of the support system
Petri Rouvinen ETLA , The Research Institute of
the Finnish Economy
Nýsköpunarverðlaun Íslands Grand hótel Reykjavík April 10th, 2014
What I mean by…
Invention Innovation≠
$+
Innovation ≈ Seeking opportunities
1% spark – 99% sweat
Needs (some) money
Mostly not technical
Mostly incremental
Increasingly digital
Innovation Entrepreneurship≈
$+ $+ +
Entrepreneurship Self-employment
Perceives economicopportunities andintroduces them
in the market
Works but is notemployed by others;may employ others
but typically not
Overlap under 10%
EU Innovation Scoreboard:Finland among leaders &Iceland among followers(above the EU average)
Source: European Union, Innovation Union Scoreboard, 2014
Finland Iceland
0.684
0.593
0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0
Economic effectsInnovatorsIntellectual assetsLinks, entrepren.Firm investmentsFinance, supportResearch systemsHuman resources
Economic effects: Finland
Innovators: Iceland
Intellectual assets: Finland
Links, entrepreneurs: Iceland
Firm investments: Finland
Finance, support: Iceland
Research systems: Iceland
Human resources: FinlandNew PhDs,upper sec. ed.
Int. co-publicat.,non-EU grad stu.
Pub-privco-publ.
Patents, trademarksprotected designs
Share ofInnovative sales
Dimensions of Innovation Union Scoreboard
Source: European Union, Innovation Union Scoreboard, 2014
VCn/a
“ Iceland is the only country for which innovation has not improved over the 2006–2013 period.”
Innovation Union Scoreboard 2014, p. 71
Early-Stage Entrepreneurs:
Iceland leads the advanced countries
Source: Global Entrepreneurship Monitor, 2010 Global Report.Measure: Early-Stage Entrepreneurial Activity / Adult pop.
Finland Iceland
5.7
10.6
• History: Attitudes & culture hostile to growth companies… but since the crisis Finland to a global startup hotbed!
• Why?– Aalto university
– Encouraging examples
– Challenges of incumbents
– Digitalization & globalization
– Several good policy measures
Startup in Finland !?
A new Act in 2009 “privatized” universities and reformed management & decision-making
3 former university merged to form Aalto Univ. in 2010
Aalto’s faculty & students became cheerleaders for startups:Aalto Entrepreneurial Society, Aalto Centre for Entrepreneurship …
A brochure of Tekes and NeoGames by the same name.
After 50 failures, Rovio hits the jackpot with
Angry Birds
Over 800 employees
After just three years of operation, Supercell
sold a 51% stake for €1.5bn
150 employees
2012 2013
250
900TurnoverMillion €
1,800 pers. 2,200 pers.
0.5 0.3 0.5 0.7 0.8 1.1 1.2 1.8 2.5 3.1 4.0 3.3 3.6 3.8 3.0 2.9 3.1 3.2 2.6 1.2 1.2 0.5-0.1
0.5
Nokia’s Share of Finnish GDP, % Source: Ali-Yrkkö, ETLA
est.
Beyond corporate & public employment…
1011010111000010
3D
IoT
Cost of entry ↓ Market reach ↑
With outsourcing &offshoring: size & location matters less
Ability to position oneself in global value chains
Vigo Accelerators Tekes: Shift in Emphasis
10 Vigos, public–private Tekes startup funding, m€
partnership business
accelerators: €220mn
private & €70mn public
investment to 90 target
firms in 2009–2013.
Some public measures
20032004
20052006
20072008
20092010
20112012
45 40 42
61 58
7488
102
127134
Conclusions
Some observations regarding Finland
• Seeking a list of (broad) growth industries inconsistent with global realities (cf. megatrends)
– Businesses do grow, but across a range of industries & often in small increments
• Too focused on “big hits” & the VC market?– A number of “nice growth” companies
may jointly matter more for society
Humble questions regarding Iceland
• Good scientific base ... Applications ???
• Icelanders with sufficient tools for thought ?
• Banks & family/friends finance 90% of new firms – But does not fulfill needs of growth-seeking startups– 5–10 rounds of startup finance before maturity: path?
• Manifold innovation support in Finland ... Iceland at its optimal level of public support?
Growth-seeking entrepreneurs (and similarly-minded corporate intrapreneurs)
are a necessary link between ideas & their societal impacts …
Is this link sufficient in Iceland ?
For Iceland to do?• Lessons from Finland?– Vigo Accelerators?
• A Norwegian-style tax incentive (≈ Tekes)?
• But: No silver bullets – this domain is systemic– A broad set of framework conditions needed
for innovation & entrepreneurship (cf. Nordic Innovation: 20 categories)
Try a lot, fail fast and often, scale up or try again.
ThankYou!
fi.linkedin.com/in/petrirouvinen/Petri.Rouvinen@ETLA.fi +358–50–3673474