hunter centre for strathclyde Global Entrepreneurship Monitor Scotland 2000 Dr Jonathan Levie Dr Laura Steele

GEM2000 RESEARCH QUESTIONS Does the level of entrepreneurial activity vary between countries? By how much? Does the level of entrepreneurial activity affect economic growth? What makes a country entrepreneurial?

GEM2000 Scotland RESEARCH QUESTIONS How does Scotland compare to the UK and other small modern nations Which factors account for Scotland's level of entrepreneurial activity What are the implications for public policy

GEM2000 Methodology Standardised Cross-national Data: 23 nations Representative Sample: 2000 adults per nation Key Informant Sample: 36 experts per nation 9 Entrepreneurial Framework Conditions: 1.Financial Support 5.R&D Transfer 2.Gov. Policy 6.Comm. Infrastructure 3.Gov. Programmes 7.Barriers to Entry 4.Education, Training 8.Physical Infrastructure 9.Cultural & Social Norms

Measuring Entrepreneurial Activity 1. % of adults actively starting a business (nascent entrepreneurship rate) + 2. % of adults running a new business (owner/managers of businesses < 3½ yrs old) = Total Entrepreneurial Activity (TEA)

GEM2000 Scotland Summary Highlights 1TEA typical of small modern nations 2Young adults more entrepreneurial - a generation shift? 3Cultural bias against entrepreneurship relatively strong 4Poor interpersonal networking retards entrepreneurship

1. How Scotland Compares Total Entrepreneurial Activity (% of working age adults)

2. A New Entrepreneurial Generation? Nascent entrepreneurship rate: % of younger and older adults Young Scots are as entrepreneurial as elsewhere, older Scots are not

2. A New Entrepreneurial Generation? “...good opportunities for starting a business…” % agreeing with this statement Opportunity perception significantly higher among younger adults in Scotland

2. A New Entrepreneurial Generation? Younger, more educated adults have highest rates of entrepreneurial activity TEA rates by age and education

2. A New Entrepreneurial Generation? Investment activity among older Scots is significantly lower than expected “You personally invested in someone else’s new business in past 2 years” % agreeing by age and nation

3. Cultural Bias Against Entrepreneurship More resentment of successful entrepreneurs in Scotland than other nations Lack of appreciation of entrepreneurship as an economic contributor? “wealthy entrepreneurs resented”: % saying yes

4. Poor Interpersonal Networking Scotland has a high fear of failure rate. Connection to Scottish networking issues? “Fear of failure would prevent you from starting a business”: % saying yes

4. Poor Interpersonal Networking “You know personally someone who started a business in past 2 years: % saying yes Scots less likely to know a new entrepreneur than citizens in other small modern nations - including nations with similar or lower TEA rates

4. Poor Interpersonal Networking “You personally invested in someone else’s new business in past 2 years”: % saying yes One consequence of poor networking is low access to start-up capital

4. Poor Networking hinders access to startup capital How it is How it should be £million

Maintaining the Momentum Business Birth Rate Strategy and changes in education may have caused a generation shift in entrepreneurial activity Widening and deepening of successful BBRS initiatives now required to maintain momentum - “making connections” Appreciating the link between entrepreneurship and economic growth Improving social interaction Education is key