The aim of YETI is to encourage young people across Europe to start their own business and to use young entrepreneurs who are already running their own enterprises to help them do it. But before preparing any course or doing any training, we need to know deeply the needs of young entrepreneurs and the real situation of entrepreneurship across Europe.
For this reason, the partnership did a research with examples of practice, case studies, academic papers, journal articles, press reports, blog posts and interesting websites to identify the range of approaches that are currently in use, which of those have been effective and what the critical success factors appear to be. In that way, all partners have been posting different information on some topics we thought were the basis to analyzed that situation of entrepreneurship. And now, we present some conclusions.
The topics that we have researched are not a definitive nor complete list but are the areas we highlighted through our own experience, expertise and interest. The components contributing to our model include:
- Encouraging Youth Entrepreneurship
- The Cooperation ecosystem between University and SME and Startups
- Incubators and Seed Finance
- Innovative Training Methods
- Start-Up Communities
- Start up networks and fundraising
- Co-Working spaces
- Encouraging Youth Entrepreneurship.
With 5.6 million unemployed young people (under 25) in the EU – and this figure is likely to rise – the necessity for drastic labour market improvement is significant. One of the solutions to alleviate the dreadful situation of Europe’s young is to promote youth entrepreneurship. Growth doesn’t come from existing companies, so start-ups and small firms are essential to create jobs and avoid the looming lost generation. Entrepreneurship comes in many forms and different roles: it is a tool to develop talent and to stimulate innovation, but in the current context also a solution for unemployment.
It has been found that youth entrepreneurship happens mostly through events to entrepreneurs, such as boot camps, educational programs or programs contributing with specific services.
There are also some companies or agencies that give support to entrepreneurs, offering them resources that they may need, for example financial aid with Spanish institutions like ENISA or CDTI, or the APCE in France giving guidance among other resources.
- The Cooperation Ecosystem between University and SME and Start-Ups.
University cooperation with SME and Start-Ups depends on the university’s facilities and professors, but in general educational institutions seem enthusiastic about entrepreneurship. This type of cooperation provides the chance to improve the competitiveness of productive sectors. There are many mechanisms, products and services offered to entrepreneurs from universities, but there are some ones more successful than others.
For instance, in UK’s Universities they have Test Trading Days, which are programs where different activities take place, such as workshops addressing topics like pricing, sales or networking; they are also supported by professional mentoring, and it usually concludes with and evaluation of skills, product and customer feedback.
Other services provided by universities are for example general business advice, business incubators services as network activities or marketing assistance. Furthermore, some Universities develop investigation projects that involve students and professors and some of those projects are implemented with advice, guidance and founds from the University community. In Spain takes place several interuniversity competitions for entrepreneurs that allows this cooperation, and the winner of the competition can receive (depending on the basis of the competition) financial aid or advice.
Our research on Entrepreneurial ecosystem shows us that Education is paramount for an entrepreneurial culture. Although the shape and structure of education that is beneficial is not pre-determined and must vary for different countries and different communities, there are elements such as employer engagement, enterprise education, awareness of entrepreneurialism, core skills (e.g. creative problem solving) that should always be incorporated. Advanced enterprise education should foresee training for teachers, practical “learning by doing” projects, financial education, work experience in companies, simulations among other activities.
- Incubators and Seed Finance.
Best practices on seed finance and incubation across countries demonstrated to us the importance of incubators and accelerator programs. Incubator programs on the one hand are important for companies that are not ready to fully go live. The focus of incubator programs should be the development of a business plan. On the other hand, accelerator programs are useful for companies in very specific and high tech areas. This is due to the speed in which ideas are turned into commercial offerings, this being useful in the notoriously fast moving high tech sector where the first mover advantage is important.
Over the last decade incubators have become more and more popular and in consequence start-up accelerators have been rising because of the incapacity of these start-ups to sustain themselves in their early stages, so these accelerators can help them to reduce this time period.
On the other hand, incubators (that are often supported by industry experts or CEOs of big private companies) should have to see the potential in a start-up because not all of them are worthy, even though they offer a creative environment from which to share ideas and support innovative thinking.
- Innovative Training Methods
Entrepreneurship is a skill that can be learnt. A person doesn’t have to be born an entrepreneur to run a successful business. This person can become an entrepreneur by developing an entrepreneurial attitude and the right set of skills. Entrepreneurship education prepares people to be responsible and enterprising individuals. It helps people develop the skills, knowledge, and attitudes necessary to achieve the goals they set out for themselves. Evidence also shows that people with entrepreneurial education are more employable and as Europe needs more jobs and therefore more entrepreneurs, it is (more than ever!) necessary to support this type of education across European Member states.
The traditional academic model of the teacher providing information directly is not always appropriate. The role of the teacher in the learning process needs to change accordingly. Instead of a one directional focus on content and direct delivery by giving lectures in front of the class, teachers need to give students real-life experiences, wider understanding of how their knowledge and skill are valued in the real world, and start acting like a coach or mentor.
A common problem throughout Europe is that teachers who lack real-world experience teach entrepreneurship, professors that are not totally competent. And the best way to teach enterprise spirit is giving an education oriented to the resolution of concrete problems, but this can not happen if the professors do not receive formation in enterprise spirit, which we think should be mandatory in their education. The most effective way to ensure that teacher competence in this field is adequate and up-to-date would be to make entrepreneurship a mandatory part of teacher training, but this is a long-term solution that requires significant support. It is also important to offer further training to teachers who have already completed their training and want to develop themselves in their path of Life-long learning.
Innovative training methods are important, but the effectiveness is not totally satisfactory. There are some games that encourage unenthusiastic entrepreneurs, and there are also other methods and events that usually occur in conjunction with Universities or Colleges.
- Start Up Communities
As a result of the economic and financial crisis, in the past few years the appropriate conditions for the development of an entrepreneurial culture had not been given, but there are solutions such as transferring expertise through an online platform and providing access to networks where entrepreneurs meet, that could grow in this field.
Events, contests, communities or media are some of the instruments that are used for promoting Start up Communities, but they don’t usually have a Social Media Strategy like consolidated companies and they have to understand how powerful social media is and learn how to maximize the potential of it in this point.
- Start Up Networks and Fundraising
Start ups networking is necessary and useful for new entrepreneurs, but it is not quite big yet for letting new start ups emerge.
Networks are an essential part of the entrepreneur’s ecosystem. They provide a social context, allow transferring knowledge and trust, and creating new opportunities. For small and young firms, the use of networks is vital. It is a means of becoming competitive compared with big businesses. Entrepreneurship emerges at the junctions of social and commercial information networks that supply entrepreneurs with ideas, exchange opportunities, access to resources such as finance, potential clients and potential partners.
Entrepreneurs should develop good “network management” for themselves. The use of functional networks can bring a wide-range of advantages for the entrepreneurs and the start-up community as a whole, either “softer” (problem-solving, credibility, reassurance) or “harder” (market knowledge information) benefits.
It is essential to build an entrepreneurial culture and give it real momentum. It is rare for a new venture not to require finance at some point in its early life, and often this finance enables it to take significant steps forward. The accessibility to different levels of money is vital so founders can target their strategy and plans around genuine prospects and focus on being sustainable and capable of growth.
- Co-working Spaces
This type of spaces are needed for those entrepreneurs and microenterprises that are beginning, by this they can share experiences and knowledge that can be useful for everyone, likewise some coworkers end up collaborating on work projects or exchanging their services as if it is a trade. The main problem of this spaces is that they are not low-cost. In Spain they are different types of this spaces, for example spaces that are mixed with incubator or accelerator services, interdisciplinary spaces for all types of entrepreneur or co-working spaces for business in the same industry.
The analysis of the value of Co-working spaces has showed us that they provide a brand and credibility to start-ups or entrepreneurs, usually too small to have their own office but wanting to progress beyond their garage. Moreover, Co-working spaces give them immediate access to a wider community which they can be part of. They provide entrepreneurs with direction and inspiration at a very low resource cost.