We often read that small businesses account for most new job growth: 63 percent of the net jobs created between 1993 and mid-2013, according to the Small Business Administration.
Less well-known is that entrepreneurship is a local phenomenon, with rates of entrepreneurship varying dramatically across the country.
A recent study by the Kaufmann Foundation attempted to determine what local factors lead to an increase in startups and startup success. Using St. Louis as a case study, Kaufman researchers evaluated the elements needed to develop a nurturing entrepreneurial environment.
The key result may startle some but will come to no surprise to the Western Pennsylvania business community. The most important element in kick-starting entrepreneurism in a region turns out to be developing a network of support organizations that enable business owners to learn from their peers and from more experienced entrepreneurs, what the Kaufmann Foundation calls a “startup ecosystem.”
Pittsburgh has a number of organizations that create opportunities for entrepreneurs to interact with their peers in formal and informal ways, including mentorship relationships between experienced business owners and startup entrepreneurs.
The study found that even if an area has many organizations, associations, university programs and government partnerships dedicated to small business, it may still not be doing enough — unless the organizations cooperate with each other.
Entrepreneurs can learn as much as economic development professionals from the Kaufmann study. In deciding which business organizations to join, entrepreneurs should place a special emphasis on finding venues where they can connect with their peers, both those in the same stage of business development and those who have already made it big.
These venues should enable the entrepreneur to connect with peers both formally in a classroom or roundtable setting and informally at social events.
— Robert A. Stein,
Institute for Entrepreneurial Excellence,
To view this article on the Pittsburgh Post Gazette’s website, click here.