By Jonathan Ortmans
In 2010, entrepreneurship appears to have finally taken its rightful place on the world stage as central to any nation’s efforts to build its economy. When a U.S. President convenes and participates with over 200 leaders from more than 50 countries on five continents a Presidential Summit on Entrepreneurship, policymakers outside the US cannot but take a hard look at entrepreneurial capitalism and how entrepreneur friendly their economies are back home.
President Obama’s Summit on Entrepreneurship, organized by Secretary of State Hillary Rodham Clinton and Secretary of Commerce Gary Locke, was designed to promote entrepreneurship in Africa, the Middle East, and South, Central and Southeast Asia as a tool for economic and development policy. It was also meant to fulfill the President’s commitment to broaden and deepen ties between the United States and Muslim communities around the world.
In both regards, the event represented just a beginning, but if the festival of events in the nation’s capital during the week of the Summit was anything to measure by, one might go so far as to suggest it also woke up Washington, DC’s international community to the powerful role entrepreneurs will now play in both driving global growth and fostering international stability. Beyond the official events and receptions, most of the major institutions in Washington such as the Brookings Institute, Aspen Institute, George Washington University and other academic institutions in the area, the International Finance Corporation and several law firms convened “global entrepreneurship” events. These combined with dozens of events convened by the institutions working in this field such the Kauffman Foundation, Endeavor Global, Global Entrepreneurship Week, AMIDEAST, Cisco, ANDE, Corporate Council on Africa, 10,000 Women and an array of organizations with Middle East expertise, speak to how popular “entrepreneurship” is as both an emerging field and a global engagement strategy for all nations.
The Obama Administration’s announcements at the Summit seemed to reflect a similar commitment to advancing entrepreneurship abroad. For example, a new two-way professional exchange program will bring 100 entrepreneurs to the U.S. and send 100 American entrepreneurs abroad. “Science & Technology Education Exchanges” will bring 25 science teachers from Muslim-majority countries and communities to examine effective methods of teaching science at primary and secondary school levels. The Overseas Private Investment Corporation’s Global Technology and Innovation Fund will make investments in start up growth-oriented companies in telecommunications, media and technology. The Department of State's Middle East Partnership Initiative and U.S. Small Business Administration will partner to promote new enterprise growth in the Middle East and North Africa. The State Department will partner with online platforms to begin coordinating a corps of entrepreneurship mentors, the “E-Mentor Corps. USAID will undertake initiatives to support entrepreneurship by providing open source web and media based entrepreneurship education, supporting local educational capacity building programs, facilitating entrepreneurs’ access to private sources of finance, and expanding business innovation centers.
The question now is how much “entrepreneurship” the Summit delegates were able to take home with them. The mere convening of this summit has put checks in the boxes next to the stated goals of the Summit (namely to highlight successful entrepreneurs from Muslim communities; expand networks among stakeholders in entrepreneurship; find ways to replicate the most successful entrepreneurship efforts and approaches; identify ways to build and strengthen economic and social climates conducive to entrepreneurship; and enable participants to announce or highlight their entrepreneurial programs).
The Summit did enable best practice sharing through sessions such as “Perspectives on Successful Entrepreneurship” in which Secretary Locke and speakers from Tunisia, Indonesia and Kuwait shared their experience about the keys to fostering entrepreneurship, and “Catalyzing Youth Entrepreneurship” which featured a discussion about the role of government and non-government actors in shaping education, training, mentorship, culture and other factors that encourage young people to be innovative and entrepreneurial. These gatherings got policymakers thinking about entrepreneurship. However, now that we have openly encouraged the world to adopt it, the real work begins.
The key challenge ahead lies in the iterative process of defining what advice and technical support to offer public and private sector leaders around the world who accepted President Obama’s challenge to embrace and foster a startup culture. Global perception of the US as the leader in this field calls for a careful examination of what is said and done. As nations ask for more specific advice, we must avoid imparting the wrong guidance on how to foster an entrepreneurial economy and culture.
Thankfully, for the most part, President Obama’s Summit avoided the typical top down, linear government thinking which too often sets a “planned economy” tone in discussions at conferences on entrepreneurship. As Carl Schramm, President of the Kauffman Foundation, recently wrote in his “Expeditionary Economics” article in Foreign Affairs,
Entrepreneurial capitalism is messy, since it is highly organic rather than centrally planned or centrally managed. Many different people and entities bring the elements—from new firms to university research to federally funded research—into place, and activity flourishes from letting them all evolve and interact in the marketplace. It is nearly impossible to predict what outcomes these activities will bring beyond a broad trend toward higher productivity, rising standards of living, and continued economic growth.
Keeping that general guideline in mind, policymakers must decide how to best unleash entrepreneurship, looking at the various elements of an entrepreneurial ecosphere: education, access to capital, innovation and commercialization mechanisms and so forth. At the Summit, entrepreneur, Dr. Mohamed (Mo) Ibrahim suggested setting rules and a legal system to foster a competitive environment by keeping regulation under control and, while leveraging public investment in mitigating non-market risks, keeping government away from picking winners.
Others focused on the importance of a skilled and entrepreneurial workforce noting that at its most fundamental level, entrepreneurship is about the successful development and commercialization of novel ideas – something impossible without creative and highly skilled individuals.
Almost all speakers concluded at the end of the Summit that it is all about a mindset and that for anything to be effective, nations have to really want more entrepreneurship. Encouraging entrepreneurial thinking among citizens is perhaps as challenging as enacting the right policies. It demands an intangible, cultural shift that is very hard for leaders to stimulate. The Kauffman Foundation has been promoting entrepreneurial cultures around the world by creating a bottom-up push for entrepreneurialism through Global Entrepreneurship Week where each November over 32,000 concurrent events in nearly 100 countries test people’s aptitude and interest in entrepreneurialism. The young entrepreneurs who participate are deeply curious about the opportunities the marketplace offers to tackle the challenges facing the world. Young people are the greatest messengers for entrepreneur-friendly policies and with the support of Secretary of State Hillary Rodham Clinton, Global Entrepreneurship Week is nurturing their interest.
Looking ahead, while the Presidential Summit on Entrepreneurship was clearly one milestone in achieving global recognition for the central role of entrepreneurship in economic growth, it did not set a path for building momentum at the strategic policymaking level? Prime Minister Erdogan from Turkey offered to host the next Global Summit on Entrepreneurship in Istanbul and clearly there is willingness for further dialogue both within the State Department and within the Muslim world. But given how important entrepreneurship is to global economic recovery, one outcome from the summit might have been to call for including more discussion on policies conducive to entrepreneurial capitalism in upcoming global economic ministerial meetings - such as the G20 meetings or APEC in Japan. To focus governments on economic strategies that prompt policies and programs conducive to new high growth firm formation is the kind of leadership worthy of a nation built by risk-taking pioneers. As the State Department now takes the baton from the White House following this event, American diplomats might do well to remember this as we seek to restore our image as the “shining city on the Hill”.
Jonathan Ortmans is president of the Public Forum Institute, a non-partisan organization dedicated to fostering dialogue on important policy issues. He also serves as a senior fellow at the Kauffman Foundation.