Nurturing the Next Generation of Pioneers

“It takes a village to raise a child.” — An African proverb

What does the African proverb about a village raising a child have to do with entrepreneurship? Plenty. Just as a child thrives in a supportive environment, entrepreneurs excel in bringing innovation to the market when supported, cherished, and guided to become successful.

A technology innovation and entrepreneurship ecosystem comprises several critical elements — family culture, educational institutions, governing bodies, and investors.

Let’s look at the impact of each of these elements in a thriving entrepreneurial ecosystem.

Family Culture 

“Family is the first school for young children and parents are powerful models.” — Alice Sterling Honi.

Family culture significantly influences the life of an aspiring entrepreneur. Families that foster risk-taking and cultivate learning from failures lay the foundation for a future entrepreneur’s successful journey.

In the book, “The Culture Code: The Secrets of Highly Successful Groups,” Daniel Coyle says,

“Group culture is one of the most powerful forces on the planet. We sense its presence inside successful businesses, championship teams, and thriving families, and we sense when it’s absent or toxic.”

He prescribes three skills that make a difference: building safety, sharing vulnerability, and establishing purpose.

Families need these skills to promote entrepreneurship. Parents could encourage the behaviors that promote psychological safety — speaking up and asking questions, pursuing different interests and taking risks and failing, collaborating with peers on projects, and practicing reflections and writing, such as gratitude logs. They could share their fallibility and not project an image of someone with all the answers. They could be role models and live their lives purposefully.

A case in point is the family of Sara Blakely, the founder of Spanx. She says,

“My dad encouraged us to fail. Growing up, he would ask us what we failed at that week. If we didn’t have something, he would be disappointed. It changed my mindset at an early age that failure is not the outcome, failure is not trying. Don’t be afraid to fail.”

Educational Institutions 

“Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.” — An old Chinese proverb

The lives of aspiring young entrepreneurs are shaped by the educational institutions they attend, and their attitudes toward innovation and entrepreneurship are significantly influenced by their educators and peers.

Universities not only provide education but create the future of our societies. They act as innovation catalysts when they foster the spirit of entrepreneurship. The leaders and educators of universities must foster active hiring of faculty who conduct research in basic science and engineering and applied technology. They must collaborate with the industry. They are in a unique position to foster social entrepreneurship. The university-based incubators work with entrepreneurs from when they have an idea by evaluating the concept, providing feedback to refine it, and helping create a business model and plan.

The leadership at many leading universities, including my alma mater, Carnegie Mellon University, emphasizes the importance of progressive research and fosters an environment that supports entrepreneurship. They combine various elements into their organization’s strategic vision to support it. These elements include interdisciplinary collaboration, the creation of research centers, strong industry partnerships, state-of-the-art facilities, engagement with the broader global ecosystem, and nurturing an active alumni network.

Governing Bodies 

Governments play a crucial role in promoting entrepreneurship and supporting innovation.

The Government of India’s startup portal, designed to facilitate networking and provide free tools and resources for startups, is an outstanding initiative. It encourages entrepreneurs to participate in its programs and challenges. The government can also work with eligible incubators to distribute seed funding to qualifying startups. Government support, such as incentives and subsidies, enables fledgling entrepreneurs and gives them time to grow their companies.

In the USA, the National Science Foundation, a federal agency established in 1950, supports fundamental research in science and engineering. It fosters innovative research projects by providing grants to universities and other institutions. The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs fund small businesses and partnerships between small businesses and research institutions.

Startups require robust infrastructure. It would be challenging to sustain a venture with constant power failures, water shortages, and disasters. There are enough hurdles without having to tackle these additional challenges in the developing world. A recent news article about fostering semiconductor manufacturing in India highlights its importance. While lobbying the states asking for 1,000 acres of land free of cost on a lease for 99 years, the company, Vedanta, is also demanding water and power at concessionary and fixed prices for 20 years, knowing how critical it is to have them for the operation of semiconductor plants.

Investors, Venture Capitalists (VCs), Incubators and Mentors 

Innovations require financial support to come to fruition. Entrepreneurs need funding to take a concept or plan from a pitch deck to a minimum viable product (MVP). We need investors willing to bet on the entrepreneurs, starting from the seed round in funding an MVP to Series A, B, C, etc. Thus, an essential requirement for a healthy entrepreneurial ecosystem is the presence of an investment community. By nature, the leaders of this community have a high-risk tolerance. Yet, some investment leaders are exceptional because not only do they finance the entrepreneurs, but they take them under their wings and mentor them through the innovation journey.

Many of these leaders set up incubators that help a venture get off the ground during the first couple of years of scaling the venture. Such incubators provide infrastructure services such as offices, hosting services, etc. Additionally, exposure to other entrepreneurs in the incubators provides opportunities for collaboration and sharing of best practices. Once the company is well on its way, incubators can offer additional support, such as globalization.

For example, the VC firm Y Combinator provides seed funding and mentoring in exchange for equity in the startup and has helped launch companies like Dropbox, Airbnb, and Reddit. Twice a year, it hosts many startups who move to Silicon Valley for three months to work on their ideas, pitches, and business models and be heard on “Demo Day.”

500 Global (formerly 500 Startups) is another incubator with a diverse portfolio, and it provides a 4-month accelerator program that includes hands-on mentorship, access to investors, and funding in exchange for equity.

The Village Behind a Successful Entrepreneur 

A healthy ecosystem is critical for prolific innovations and successful entrepreneurship. The foundation of an entrepreneur’s aspirations is laid by their families when they start their lives. To nurture the seed sown in childhood, we need a robust scaffolding consisting of educational institutions, government bodies, and investment firms, all working together in an entrepreneur’s long and winding startup journey.

Written by Shantha Mohan Ph.D.

Have you read?
World’s Best Countries To Invest In Or Do Business.
World’s Most Startup-Friendly Countries.
World’s Best Countries For Quality of Life.
Largest Economies Europe In 2024.
GDP of the BRICS countries (2000 to 2028).