The Global Entrepreneurship Monitor, an annual research piece from London Business School and Babson College in the US, reveals that early-stage entrepreneurs are increasingly reliant on export markets as they build their businesses. And because their success overseas depends on viable institutions and a liberal approach to trade and investment in these countries, it argues that entrepreneurs need to work together to exert pressure.
‘The GEM 2007 report strongly recommends that entrepreneurs organise to achieve political influence on an international level,’ it says (just in case you didn’t believe us). Babson professor Kent Jones argues that entrepreneurs are vital to global growth – and that requires ‘an open and expanding world economy’. And since 40% of early-stage entrepreneurs expect to about a quarter of their customers to be overseas, they’ve got a vested interest in making this happen.
Interestingly, the latest GEM report found that early-stage entrepreneurship tends to be high in countries with low per capita GDP, and in countries with high per capita GDP – but not for countries in between. This presumably shows a difference in motivation. Whereas in the former case entrepreneurs act out of necessity, because there are no better options available, in rich countries it’s more opportunity-driven. In Scandinavia, for example, people tend to pursue these opportunities on a part-time basis.
Top of the class when it comes to national entrepreneurship is not the traditional hotbeds of the US and Hong Kong – it’s actually the rather cooler venue of Iceland, where activity stands at 12.5%. Although this still pales in comparison with the emerging markets of Asia and South America: Thailand, Peru and Colombia all have activity rates of more than 20% (though we dread to think exactly what counts as an ‘entrepreneur’ in Colombia).
But although levels (and perceptions) of entrepreneurship vary around the world –even between different cities in the same country, according to the survey – at least one aspect of an entrepreneur’s life seems to be a constant: complaining about regulation. GEM found that greater regulation means less ambition for growth among that country’s entrepreneurs.
Which just brings us back to our original point: growing a business in the global economy will be easier if entrepreneurs can exert more influence in political circles. Stelios for PM, anyone?