The two sentences that I very often hear and that scare me the most when I attend conferences on business incubation are “there will never be too many business incubators in the world” and “We want to set up a one-stop-shop for all the entrepreneurs in our region”.
I have heard these two sentences (or some declination of the concept they want to express) so many times that I am almost about to give up fighting. It is discouraging!
Well, let me break it down once and for all: it doesn’t work that way. It hasn’t worked and will never work that way. And those of you who design policies and design the workings of entrepreneurial ecosystems should understand this once and for all.
What’s the problem here? Simple. Entrepreneurs are seen as a uniform and homogeneous group that needs the same things at the same time and that can be served conspicuously by just pulling everything in one single organization. And all you need to do to reach them is to replicate the model over and over. Cool right? Yes, maybe in a robot world a few hundred years from now, but a recipe for disaster today and in the foreseeable future.
The simple concept that you can squeeze the entire ecosystem in one place is a ghost to fear, and not something to aspire to. Ecosystems are complex animals, that need to mutate, change, adapt and experiment according to their own mission (entrepreneurship support in our case) and their own reason to be. Entrepreneurial ecosystems are composed of many different players each with different competencies, skills and capacities.
Communities of entrepreneurs are not a solid and homogenous lot whose members can be simplified and represented through a unique identifying model that can be served through the deployment of uniformed solutions. Entrepreneurs need diverse and changing services that align to the multitude of factors that make them unique and special (e. g. sector, life goals, stage of development, level of education, financial conditions and so much more).
It is impossible to square out what an entrepreneur needs today, let alone in a year from now. Condensing all this in one place? Forget it.
The concept of “one-stop-shops” has mesmerized Europe in the 90s. can you figure? A place where all entrepreneurs, would-be entrepreneurs, startups and SMEs would find all they need without any hassle and in a single spot? A dream come true! Fortunately, this fantasy did not last long, as we came to realize that it is simply impossible to enable a single organization to provide all that an entrepreneur needs in all the stages of the journey.
Unfortunately though, a lot of players remain fascinated by this phantasm, and still many (failing) policies are designed to acquire such a goal by politicians that do not understand the inner workings of entrepreneurialism.
The other element that policy-makers and ecosystem builders need to understand is that the marketplace for entrepreneurship support organization is already very crowded, and there needs to be a limit to the amount of support organizations that can operate in a single region. As said before, resources are scarce and having to slice the pie to please more and more support organizations is harmful for multiple reasons the main one being that it creates confusion in an ecosystem where the same services are delivered by a lot of different organizations. Entrepreneurs will not know where to go and who can help them best.
The one-stop-shop mode is not the solution. The alternative scenario (the 1000-stop-shop) is not the solution either. So, where do we start looking?
In our reality composed of scarce resources and unknown patterns of growth, if indeed there are any, of an entrepreneurial venture (especially in the startup phase) “Incubators – in the words of my dear friend Tom Mancuso – need to be as flexible as they can possibly be and fill the gaps of the entrepreneurship support value chains in a given ecosystem”. I could not agree more.
In our practice at H&D Partners, we strive to find solutions for supporting local ecosystems to organize themselves, through the application of tools and processes aimed at facilitating the journeys of local entrepreneurs, always with uncertain results. We know where we start but not where we are going to end up. The process of enhancing an entrepreneurial ecosystem is a dynamic adventure that starts with the assessment of the main needs of the community of entrepreneurs at a given time and analyses what is being provided and what needs to be provided. Only after this painstaking exercise we allow ourselves to start the design of the services and of the elements that will form a support program, knowing very well that one of the key characteristics that need to be embedded in the program itself is flexibility. Entrepreneurs evolve, therefore programs need to evolve accordingly.
We support the build-up of local entrepreneurial ecosystems and the design of ad-hoc entrepreneurship support program with methods and processes that enable the best possible support services to the local entrepreneurs. We do so by intaking their characteristics and their aspirations which are multi-faceted and, oh, so diverse! We do so, by acknowledging that change happens over time whether you like it or not.
Most of all, we do that humbly, knowing that the best possible solutions we find for a given ecosystem will not be replicable (although they definitely can be inspirational) hoping to contribute to the economic and social growth of the regions and territories we are privileged to serve.