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Development of Entrepreneurship Ecosystem

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2905 Int. J. Adv. Biol. Biom. Res, 2014; 2 (12), 2905-2908

IJABBR- 2014- eISSN: 2322-4827

International Journal of Advanced Biological and Biomedical Research

Journal homepage: www.ijabbr.com

Review Article

Development of Entrepreneurship Ecosystem

Elahe Yaribeigi*, Seyed Jamal Hosseini, Farhad Lashgarara, Seyed Mehdi Mirdamadi, Maryam Omidi Najafabadi

Ph.D. Student in Agricultural extension and education, Department of Agricultural Extension and Education, Science and
Research Branch, Islamic Azad University, Tehran, Iran

ARTICLE INFO ABSTRACT

Article history:
Entrepreneurship in the world, especially in Western developed countries, the much
Received: 06 Sep, 2014
Revised: 27 Oct, 2014 interest in recent years the concept of entrepreneurial ecosystems and integrating the
Accepted: 21 Nov, 2014 separation of infrastructure services needed by entrepreneurs and governments
ePublished: 30 Dec, 2014 innovative citizens, industrialists and entrepreneurs to create. a person apart from the
Key words: idea of an entrepreneur, long way to run and deliver it to the finally, profitability and
Development growth of the organization. In many cases the idea does not run and stays in the mind.
Entrepreneurship ecosystem is composed of the factors in the development of
Ecosystem
entrepreneurship involved. Macro-economic factors, cultural, social and political
Entrepreneurship willingness and ability to influence the choice of entrepreneurial activity. Hence the to
Ecosystem create an entrepreneurial environment, due to factors such as culture, policy, Financial
resources, human capital, market and support services as areas entrepreneurship
ecosystem is of particular importance.

INTRODUCTION environmental favorable, thereby taking advantage of the

entrepreneurial opportunities.
Entrepreneurship is a process that plays a vital role in Research entrepreneurship has shown that
the continued growth and development of national and environmental factors, such as cultural factors - social,
even international economy is therefore necessary to legal, political and technological positive or negative
create the conditions and environment for logical impact on the development are entrepreneurs (Deakins
support, including physical, spiritual, cultural, and and Freel, 2003). The ecosystem consists of a set of
scientific research entrepreneurship and entrepreneurs actors linked together in a specific location, including
more than ever, our country will be felt. Economists, universities, research institutions and development of
entrepreneurs and community economic development as human resources and formal networks unofficially,
the engine of growth and management scientists, governments, investors, professional service providers
entrepreneurs, the most important factor in the and cultural in an open and dynamic environment in
evolution and innovation in the present era of enterprise which all these elements are connected (Ghanemzadeh,
are so important in any environment where members 2012). Entrepreneurship ecosystem is made up of three
entrepreneurship is the art of thinking, dynamic and key factors: 1 - There is a critical mass of entrepreneurs,
diversified economy will. companies, and institutions specialized in a particular
There are entrepreneurs in all countries and cultures. location 2 - Developed a dense network of relationships
Unfavorable environment for entrepreneurship often between the actors, and 3 - a culture where all the It
leads to the growth of the underground economy, while brings together elements (Isenberg, 2011).

*Corresponding Author: Elahe Yaribeigi, Ph.D. Student in Agricultural extension and education, Department of Agricultural Extension
and Education, Science and Research Branch, Islamic Azad University, Tehran, Iran (Elaheyaribeigi@yahoo.com)
2906 Yaribeigi et al/ Int. J. Adv. Biol. Biom. Res, 2014; 2 (12), 2905-2908

Specifying generic root causes of the

The Entrepreneurship Ecosystem: Four Defining entrepreneurship ecosystem has limited practical
Characteristics value
Whereas there is evidence that education, regulatory and
The entrepreneurship ecosystem consists of six legal frameworks, and well-functioning capital markets
domains do indeed impact the level of entrepreneurship in a
(see diagram). Actually, the entrepreneurship ecosystem society, in general the impacts are over a long time frame,
consists of hundreds of specific elements that, for and also weak. The big step changes in entrepreneurship
convenience, we group into six general domains: a that we witness from time to time are the results of what
conducive culture, enabling policies and leadership, statisticians call “high order interactions,” that is, many
availability of appropriate finance, quality human capital, variables working together. In fact, a handful of
venture-friendly markets for products, and a range of individual people, sometimes one or two, can be the
institutional and infrastructural supports. Our catalysts without which the step change would not have
entrepreneurship ecosystem diagram shows fifty of these occurred. So whereas it is useful to assess each regional
specific components (Cotis, 2007). entrepreneurship ecosystem to specify causal paths at
specific points in time, determining generic causal paths
are less useful. Furthermore, what we often think of as
outcomes can also be causes: in what I call the law of
small numbers, you can often identify one or two more-
or-less-random successes that are actually very causal in
evolving the ecosystem. Skype impacted Estonia’s
ecosystem, Scitex and Elscint stimulated Israel’s,
Shockley, Fairchild, and HP helped create the Valley,
Digital Equipment Corporation in Boston, and Baidu was
influential in China. Success breeds success.

Entrepreneurship ecosystems become (relatively)

self-sustaining
Because success does breed success by feeding back to
Figure 1: The Entrepreneurship Ecosystem figure enhance the six domains of the entrepreneurship
ecosystem, there is a tipping point at which government
Each entrepreneurship ecosystem is unique involvement can and should be significantly reduced; not
Although any society’s entrepreneurship ecosystem can eliminated, but reduced. Once the six domains are strong
be described using the same six domains, each ecosystem enough, they are mutually reinforcing, and public leaders
is the result of the hundreds of elements interacting in do not have to invest quite so much to sustain them. In
highly complex and idiosyncratic ways. Israel’s fact, it is critical that entrepreneurship programs are
entrepreneurship ecosystem evolved in the 1970s with designed to be self-liquidating in order to focus on
no natural resources, military necessity, and far from building sustainability into the environment (Isenberg,
markets for its products. Ireland’s ecosystem evolved in 2011).
the 1980s in the context of free education, native English,
foreign multinationals, and proximity to the European The Global Startup Ecosystem Index
market. Taiwan’s entrepreneurship ecosystem evolved in The first column in the index is the overall ranking,
the 1990s in the context of a huge accrual of highly followed by 8 weighted component indexes that are the
successful Taiwanese expatriates in the US. China’s inputs to the overall ranking,
entrepreneurship ecosystem is evolving now in the Here is how we define the eight weighted component
context of diverse regional policies and a somewhat indexes:
(some would argue, very) totalitarian political system.
Startup Output Index
The startup output index represents the total activity of
entrepreneurship in the region, controlling for
2907 Yaribeigi et al/ Int. J. Adv. Biol. Biom. Res, 2014; 2 (12), 2905-2908

population size and the maturity of startups in the Differentiation Index

region. The differentiation index measures how different a
Funding Index startup ecosystem is to Silicon Valley, taking into account
The funding index measures how active and how the demographics and what types of companies are
comprehensive the risk capital is in a startup ecosystem. started there. Since Silicon Valley is the #1 ecosystem it is
assumed that other ecosystems will perform better if
Company Performance Index they differentiate themselves from Silicon Valley and
The Company Performance Index measures the total establish their own strengths (Feld, 2012).
performance and performance potential of startups in a
given startup ecosystem, taking into account variables
such as revenue, job growth, and potential growth of
companies in the startup ecosystem.

Mindset Index
The mindset index measures how well the population of
founders in a given ecosystem thinks like a great
entrepreneur, where a great entrepreneur is visionary,
resilient, has a high appetite for risk, a strong work ethic
and an ability to overcome the typical challenges startups
face.

Trendsetter Index
The trendsetter index measures how quickly a startup
ecosystem adopts new technologies, management Figure 2: The Global Startup Ecosystem Index
processes, and business models. Where startup
ecosystems that stay on the cutting edge are expected to CONCLUSION
perform better over time.
There’s a good chance the trendsetter index is a leading Most approaches to entrepreneurship and developing
indicator of the future success of a Startup Ecosystem. countries in recent decades it caused a wave of
The trendsetter score for example corroborates with the development policies to create jobs in the world.
prevailing excitement expressed about the Berlin and Different countries in the past three decades solution to
Sydney Startup Ecosystems, overcome the problems They have turned to various
while also aligning with the anecdotal evidence we have social and economic development, entrepreneurial
received about the conservative culture and slow pace of culture, perform the necessary support entrepreneurs,
adaptation in the Chicago and Tel Aviv startup providing them with the necessary training and research
ecosystems. is needed in this area . Reflecting the economic situation
and trends Stages of development in advanced and
Support Index developing countries to entrepreneurship has been
The support index measures the quality of the startup given, which indicates that these countries have been
ecosystem’s support network, including the prevalence able to remarkable progress in different fields of
of mentorship, service providers and types of funding economic and social gain or minimum inconvenience to
sources. the health crisis behind the crisis they were predicted to
occur in the future is inhibited.
Talent Index
The talented index basically measures how talented the REFERENCES
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