Kauffman Foundation-funded report shows sharp drop in firm entry and significant increase in firm exit in 12 countries
(KANSAS CITY, Mo.), Nov. 19, 2009 – As part of Global Entrepreneurship Week (Nov. 16 – 22), the Organisation for Economic Co-operation and Development (OECD) today unveiled the first indications of how the economic slump has impacted entrepreneurship in the United States and 11 other countries in 2008 and most of 2009. The report, Timely Entrepreneurship Indicators, shows that firm formation declined and exits increased, which economists say could have significant implications for job creation.
"Our research shows that new and young firms have been the primary source of new jobs in the United States over the past three decades," said Robert Litan, vice president of Research & Policy at the Ewing Marion Kauffman Foundation, which funded the study. "While business exits are a normal part of a healthy entrepreneurial ecosystem, this study shows a concurrent increase in exits and decrease in formation throughout OECD countries as a whole. This should send a giant red flag to policymakers around the globe to pull out all the stops to encourage and support business startups so we can create new jobs and sustain a worldwide economic recovery."
Timely data on firm entries show a remarkably similar pattern across countries and clearly suggest that the economic crisis has had a significant impact on entrepreneurship. Firm entries have slowed following the economic crisis, although there are differences in timing among countries. The United States and the United Kingdom (and to a lesser extent Spain) observed a decrease in firm entries already in 2007, when most other countries were still reporting a steady rise. The subsequent strong fall in firm entries during 2008 and 2009 has resulted in fewer firm entries than in 2005 (except for France and Belgium). The researchers warn that the data for the first half of 2009 should be interpreted with care, however, given the reported signs of economic recovery in recent months in some countries. The Timely Indicators is part of the second-year results of the Entrepreneurship Indicator Program (EIP), which uses official government data to measure performance in 23 countries.
Similar to last year’s publication, the 2009 EIP presents indicators on entrepreneurial performance. What’s different this year is that the EIP has expanded in breadth and scope to reinforce the multiple measures of internationally comparable data on entrepreneurial activity from 18 OECD countries in 2008 to 23 countries and regions. In addition, the report presents for the first time a broad set of indicators on entrepreneurial determinants (access to finance, regulatory framework, knowledge creation and diffusion, market conditions, entrepreneurial capabilities and entrepreneurial culture), allowing countries to benchmark themselves in terms of entrepreneurial policies and the entrepreneurship environment.
According to the report, Eastern European countries and Brazil—countries undergoing a high degree of restructuring—are experiencing higher rates of firm births, deaths and even growth. Employment creation and destruction through firm births and deaths seem to form an important part of the employment churning in countries. The report also shows the services industry having a higher degree of entrepreneurial dynamism compared to manufacturing.
For more information, visit: www.oecd.org/statistics/measuringentrepreneurship
Entrepreneurs' Gloom Contradicts Wall Street Optimism
(KANSAS CITY, Mo.) Sept. 22, 2009 – The Ewing Marion Kauffman Foundation today announced the results of a new survey of American entrepreneurs showing that entrepreneurs and small businesses continue to struggle despite increasing optimism on Wall Street. One week before Federal Reserve Chairman Ben Bernanke made the statement that the recession is "very likely over," two-thirds of entrepreneurs reported that the economy is heading in the wrong direction.
In the past year, more than one-third of the entrepreneurs surveyed have shed jobs while only five percent of entrepreneurs have added employees. A majority of entrepreneurs believe that the stimulus package has hurt entrepreneurial activity, and entrepreneurs want government to pursue a fundamentally different approach to encourage entrepreneurship.
"In America, entrepreneurial activity is a leading force in the health and growth of our economy," said Carl J. Schramm, president and CEO of the Kauffman Foundation. "These results confirm that we've got a long way to go before we’re in the clear."
Later this week the Kauffman Foundation will release details of a new initiative designed to enable entrepreneurs to have more influence on decisions that impact small business growth and job creation.
Kauffman Foundation studies have shown that entrepreneurs have historically been key drivers of economic recovery in past recessionary periods. Since 1980, companies less than five years old have accounted for virtually all net new job creation in the United States.
"Pessimism and revenue loss among entrepreneurs on the front lines of the economy indicate that the fruits of economic recovery have yet to hit Main Street," Schramm said.
Other key findings include:
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69 percent of entrepreneurs believe the recession will last one to two years longer
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75 percent think the United States cannot have a sustained economic recovery without another burst of entrepreneurial activity
Pollster Doug Schoen surveyed more than 250 entrepreneurs and 150 "would-be" entrepreneurs from Sept. 8 to Sept. 12, 2009. An entrepreneur was defined as someone who has started a business and is currently running it. A would-be entrepreneur was defined as someone who would like to start a business.
http://www.kauffman.org/newsroom/entrepreneurs-gloom-contradicts-wall-street-optimism.aspx
The 7 Most Overrated Businesses by Kelly K. Spors and Kevin Salwen
With roughly 6.7 million jobs lost since the start of the recession, it's tempting - and often a great idea - to launch your own business. That way, of course, you can take matters into your own hands. No more rolling your eyes at the boss; it's your show. But many people do a lousy job of picking businesses they can realistically turn into a profitable operation.
http://smallbusinessanswers.yahoo.com/overrated
Most Entrepreneurs Don’t Survive the Takeoff
Every pilot has to make sure the weight-thrust ratio is correct, or else the runway will end before the plane takes off. Not a good thing if you want to survive the takeoff.
If the plane is overloaded, a good captain will refuse to take off. He knows how long the runway is. He knows that the aircraft must be at the correct weight in order to lift off.
You wouldn't want to be the passenger if you knew that your plane was over the weight limit, would you?
Well, your startup is no different. Most entrepreneurs overload their idea by trying to capture too many segments of the market. Or they create a product with too many features. Or they have developed a message aimed at too many constituents. All of these problems are bad news!
You must unload most of your baggage. Choose one hill to be king of. Once you have conquered that hill, you can take on the next one.
Find the sliver of target customers who need you most. Figure out how to get to them and make them loyal enthusiasts. If you accomplish that goal, your task will be a lot easier. Once you have won their hearts, you will be able to fine-tune your ideas and look for the next piece of the market pie.
Don't worry that others will copy you once the cat is out of the bag. Execution is key, and intimate customer knowledge is something no one can take away from you. You will be able to expand as you befriend and serve these initial customers.
I have made the mistake of overextending myself many times, spending tens of millions of dollars to learn this valuable lesson. Don't make the same mistakes I did!
Naeem Zafar
The Startup Advisor
20 Year Silicon Valley Veteran
University of California, Berkeley Haas Business School Faculty Member
El Gerente Emprendedor
Tomado de Américaeconomía.com el 30 de junio 2009.
http://www.americaeconomia.com/295811-El-Gerente-Emprendedor.note.aspx
Boomers Drive Entrepreneurial Growth
June 30, 2009. With entrepreneurial growth paving the way to economic recovery, a new Kauffman Foundation study indicates that this boom may occur because of America's changing demographics, not in spite of them. Contrary to popular belief, the baby boom generation is the most entrepreneurially active, according to data summarized in the study, while the Facebook generation is the least.
Lea el estudio completo en : http://www.kauffman.org/uploadedFiles/the-coming-entrepreneurial-boom.pdf
Kauffman Foundation Study Finds More than Half of Fortune 500 Companies Were Founded in Recession or Bear Market
(KANSAS CITY, Mo.) June 9, 2009 – According to a new study by the Ewing Marion Kauffman Foundation, challenging economic times can serve as the rebirth of entrepreneurial capitalism, leading to the creation of much-needed new jobs.
The study, "The Economic Future Just Happened," found that more than half of the companies on the 2009 Fortune 500 list were launched during a recession or bear market, along with nearly half of the firms on the 2008 Inc. list of America’s fastest-growing companies. The report also suggests a broader economic trend, with job creation from startup companies proving to be less volatile and sensitive to downturns when compared to the overall economy.
Lea el estudio completo en: http://www.kauffman.org/uploadedFiles/the-economic-future-just-happened.pdf
The Economist Casts Light on Entrepreneurship
The March 14, 2009 edition of The Economist features a groundbreaking special section devoted to entrepreneurship. The magazine's first-ever "Special Report on Entrepreneurship" takes an in-depth look at the global renaissance of entrepreneurs despite the economic downturn.
http://www.economist.com/specialreports/displaystory.cfm?story_id=13216037
Giving Capitalism Its Due
The work of the Kauffman Foundation to promote entrepreneurship was featured this month in The Wall Street Journal's Weekend Interview column. Carl Schramm, president and CEO of the Kauffman Foundation, was interviewed by Naomi Riley for the piece, which appeared in the April 4, 2009 edition of The Journal.
Go to The Wall Street Journal article: http://webreprints.djreprints.com/2170291033274.pdf
Nace Google Ventures para financiar emprendimientos tecnológicos
Google sigue apostando por la innovación en tiempos de crisis, su último movimiento es Google Ventures, un nuevo servicio de Google para apoyar la innovación y promover a empresas jóvenes o start-ups prometedoras de la industria tecnológica relacionada con Internet, software, energías renovables, biotecnología y el cuidado de la salud.
La dirección del nuevo programa es:
www.google.com/ventures/index.html
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