How to Cook Up a Vibrant Entrepreneurial Ecosystem

Latest Kauffman Policy Digest highlights entrepreneurial ecosystem myths and offers a ‘recipe’ to create vibrant ecosystems

(KANSAS CITY, Mo.) November 3, 2015 – In the midst of an uneven recovery from the Great Recession, local policymakers around the country are turning to entrepreneurship to boost economic growth. According to the most recent Entrepreneurship Policy Digest released today by the Kauffman Foundation, building a vibrant entrepreneurial ecosystem is necessary to support and encourage entrepreneurial activity.

Research shows that while some “ingredients” have a positive relationship to a strong entrepreneurial ecosystem, other factors remain unproven. The Policy Digest dispels myths about the effectiveness of three common “ingredients,” such as venture capital, accelerators and incubators, and university connections.

The Digest offers several guidelines for creating a vibrant entrepreneurial ecosystem:

  • Avoid startup monoculture by creating your own recipe to construct an environment conducive to new business creation.
  • Convene entrepreneurs and organizations to facilitate learning between entrepreneurs across industries and sectors.
  • Encourage diverse participation in the ecosystem.
  • Strengthen local education and increase graduation rates.
  • Listen to local entrepreneurs’ needs.
  • Improve business licensing and permitting processes.
  • Simplify municipal tax codes to make payment systems more efficient.
  • Champion local entrepreneurs by publicly celebrating entrepreneurial success.
  • Measure, measure, measure.

The Digest also highlights the Recipes for Growth City Challenge, which took place at the Kauffman Foundation’s 2015 Mayors Conference on Entrepreneurship. At the event, five cities pitched a plan they developed to strengthen their ecosystems. The cities of Knoxville, Tenn., and Louisville, Ky., were awarded funding to implement their plans.

Read the full Digest here.

The Kauffman Foundation’s Policy Digests consist of summaries of findings around relevant policy issues that will inform and educate policymakers. To read the entire Policy Digest on entrepreneurial ecosystems and to sign up to receive subsequent Digests, go to