Entrepreneurs... the makers, the doers, the dreamers.

The Entrepreneurial Ecosystem Building Playbook - Kauffman Foundation

Entrepreneurs are people who turn ideas into reality, charging directly into the headwinds to create something of value where there was no value before. They come from all different backgrounds. They represent a wide range of ages and educational experiences. They work across industries and professions. Indeed, anyone can be an entrepreneur.

Entrepreneurs drive progress.

Human history, in part, is the story of people turning concepts into innovations, sharing them with others, and raising standards of living for all. From the wheel to the airplane, from new restaurants to new nonprofits, each improvement changes our lives and allows other innovations to follow.

We celebrate entrepreneurs.

There is a resurgent interest in entrepreneurship today, both in the United States and worldwide. We are celebrating and cultivating it in many new ways. For instance, many successful entrepreneurs today have celebrity status. Books, television and movies tell their stories. Media follow entrepreneurs, covering their businesses but also their personal lives, investments and philanthropy.

Ecosystem Playbook

Society is looking for solutions...

Governments seek policies to nurture innovators, grow businesses, and uplift economies. Investors hunt for promising new companies to create wealth. Community leaders search for the missing ingredient that will enable them to help more entrepreneurs succeed and lift their neighborhoods.

Ecosystem Playbook

...because entrepreneurship benefits all of us.

Entrepreneurship empowers individuals, improves standards of living throughout a community, and creates jobs, wealth and innovation in the economy. In fact, most of the net new jobs in the U.S. are created by new and young companies.

Ecosystem Playbook

But there are discrepancies between perceptions and reality.

The reality is that the entrepreneurial economy is much bigger than the famous entrepreneurs in the media. And although entrepreneurship is increasingly an urban phenomenon, it's not only happening in the largest metropolitan areas or those known for their startups. Of the ten metros with the biggest improvements in startup activity in the past seven years, six are in the middle of the country.

Ecosystem Playbook

There is an entrepreneurship deficit.

Despite this increase in interest in entrepreneurship, the reality is that we are in the midst of a thirty-year decline in entrepreneurship activity. Although entrepreneurship is discussed a lot, Americans are starting new businesses at about half the rate they were a generation ago.

Ecosystem Playbook
Ecosystem Playbook

And it's exacerbated by barriers facing specific populations.

Certain groups are consistently underrepresented in the entrepreneurial economy, leaving untapped human potential on the sidelines. Women are half as likely as men to own businesses. Minorities own half as many businesses as non-minorities. And minority-owned businesses start smaller and stay smaller.

Ecosystem Playbook

Fewer jobs are created...

Companies are not creating as many jobs as they did in the past. Take, for example, Kodak and Facebook, each a technology giant in its day. In 1962, Kodak employed 75,000 people. In 2013, when Facebook hit the same revenue scale, it employed only 6,300 people.

...to the detriment of our economy.

The entrepreneurship deficit has profound consequences for our economy. Recent research suggests that this deficit is related to some of today's biggest challenges: the jobs deficit, slow productivity growth, stagnant wages and rising inequality.

The world is shifting.

We are at a turning point in history. The exponential increase in connectivity and technology is ushering us in a new economic era. As the Industrial Age comes to a close and a new economic system emerges, we face massive change and uncertainty. But there is also tremendous opportunity.

Ecosystem Playbook

An opportunity—and an imperative.

We must make our economy more entrepreneurial, creating more growth, jobs, wealth and innovation. Communities need to think beyond stealing companies from other jurisdictions and retaining existing companies. Instead, they must concentrate on growing new companies. Entrepreneurship is about opening access to economic prosperity for everyone, regardless of who they are or where they come from. We must forge a new American Dream that is more accessible to all.

Ecosystem Playbook

Traditional methods of helping entrepreneurs aren't enough. We can't just give out more tax incentives, infusions of capital or access to a business incubator. There is no silver bullet that will address the entrepreneurship deficit or the barriers to entrepreneurship that many face. We must address the entire system. We need to change the way we think about helping entrepreneurs.

People are the new companies.

Traditional economic development focuses primarily on attracting, retaining and growing existing companies. However, those techniques seem increasingly limited in impact. We need to focus more on the people who bring ideas to life—the entrepreneurs. It's time to update our economic development paradigm to a human-centered one, concentrating on people who create economic value from scratch. That is, entrepreneurs.

Every entrepreneur has distinct stories and unique aspirations. They all face barriers in their own way. Our task is to help them start their businesses and give them the individualized assistance they need to pursue their entrepreneurial dreams.

Ecosystem Playbook

Ecosystems are the answer.

Entrepreneurship doesn't happen in a vacuum. It's the result of countless complex interactions in a community. No single organization can provide sufficient help to all the entrepreneurs in a community.

We have to build the ecosystem that surrounds entrepreneurs. Ecosystems help entrepreneurs thrive at each step. Just as the complex biological system of soil, water, sunlight, flora and fauna in a rainforest allows individual plants to flourish, so the ecosystem for entrepreneurs is essential to their success. Healthy ecosystems allow talent, information and resources to flow quickly to entrepreneurs as they need it.

Ecosystem Playbook