Ecosystems presentation

INTRO

2012

Understanding business ecosystems

2012

INTRO

Entrepreneurs are a key mechanism for turning knowledge into products and jobs

Fast growing new companies are important for jobs and wealth

Entrepreneurs are a key driver for competition

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INTRO

Denmark has a major challenge in scaling up new companies

We need to meet this challenge to create jobs in the global knowledge economy.

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INTRO

In Denmark, very few companies realise their global potential compared to the US

Source Nordic Entrepreneurship Monitor, Fora 2010

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INTRO

In Denmark, new companies account for 9% of the employment. In the US, new companies account for

25% of the employment.

Source Ibsen og Westergaard-Nielsen (2010): Job creation by Firm in Denmark & Haitiwanger og Miranda (2010): Who Creates Jobs? Small vs. Large vs. Young. Se FORA (2010): Den danske produktivitetsudfordring.

USADK

More than 10 years old 1-10 years old 0-1 years old

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INTRO

Source Nordic Entrepreneurship Monitor, Fora 2010

In the US about 90 young companies each year reach more than 1000 employees.

For Denmark to match the US 1 or 2 young companies must every year reach

more than 1000 employees

In Denmark, it has not happened in many years.

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INTRO

In the US, some regions are good in creating fast growing new companies while some regions are not.

Why do these new high-tech clusters emerge in some places and not in others?

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INTRO

Because new companies succeed in good business ecosystems

which only exist in some regions

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INTRO

But what is an ecosystem?

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INTRO ECOSYSTEMS

Can the ecosystems in nature help our understanding of business ecosystems?

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Why do strong business ecosytems emerge in some places and not in others?

We asked three questions about business ecosystems

How can business ecosystems be reshaped?

How strong are the Danish business ecoystems compared to best practice?

INTRO ECOSYSTEMS

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This study has been summarized in 3 reports

Benchmark Report

Travelogues

Danish Biotech Ecosystem

INTRO ECOSYSTEMS REPORTS

2012

We have benchmarked regional ecosystems in IT, Biotech and Cleantech

in USA, Canada and Europe

Benchmark Report


The benchmarks are based on 4 indicators:

Dealmakers, Venture capital, Patents, Location coefficient

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It seems possible to make a valid ranking of ecosystems based on the four indicators.


Europe has no ecosystems that match the best ecosystems in USA

The best ecosystems are located in the US.

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Silicon Valley

San DiegoPhoenix

Denver

Minneapolis

Seattle

Austin

Research Triangle Park, Raleigh-Durham

Boston

Chicago

London

Cambridge

Stockholm

Copenhagen

USA

Northern Europe

Ecosystem ratings for USA and Northern EuropeSource: Own calculations

BiotechIT & Tele

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We have interviewed people in strong and less strong ecosystems in US.

Travelogues


Some of the interviewed have helped create the ecosystem or have been

key players in the ecosystem.

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Strong ecosystems emerge when open and innovative companies - mother companies - are

active in the ecosystem


AND

When successful entrepreneurs - serial entrepreneurs - remain in the region and

reinvest time and resources


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“If SAS Institute and RedHat had the same open and innovative culture as many companies in SiliconValley and Austin, RTP could have been one of America's very successful entrepreneurial regions.”Amit Singh, entrepreneur of Indian origin, 800 employees, including 50 in RTP

Paul Jerde, Leeds School of Business

”The serial entrepreneurs are an important element in the ecosystem.”

Conversation with Franck Nouyrigat, Start-up Weekend Seattle

“The ecosystem in Seattle started growing only when Amazon and Starbucks started with their open and innovative culture.”

Research Triangle Park, North Carolina

Seattle, Washington

Denver, Colorado

Chicago,Illinois

Groupon has been a big success, and the company founders are Chicago guys who will stay and invest in Chicago. CHK Conversation with Craig C. Bradley, Edwars Wildman

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We interviewed key players from the emergence of Danish biotech

Danish Biotech Ecosystem


International data on employment, venture capital and university research illustrates the standing of

the Danish biotech cluster

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The reason for the relative success was access to venture capital and experienced professionals

from established companies e.g. Novo Nordisk

The biotech cluster in Copenhagen is one of the biggest in Europe, but far behind the best

clusters in the US

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The reason Copenhagen is behind the best US clusters is a lack of experienced

management teams to scale the new biotech companies

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“Many of the leading Danish biotech companies started from 1998 to 2001. It was especially talented people from Novo, who had some great ideas and got a pat on the shoulder from the company. This has undoubtedly contributed to the Danish biotech cluster being among the world's largest clusters today.”

Christian Motzfeldt, Vækstfonden

"The culture in the big companies play an important role in Danish biotech. It is important that employees can go out in a new business during a period without the door being closed behind them. Established companies can be important birth attendants when their employees want to break new ground and start their own business."Mads Øvlisen,Copenhagen Business School


"It can be a challenge to become CEO of a new biotech company for an employee e.g. from Novo or Lundbeck if they have not been part of the management team where the strategic overview is often developed."Eva Steiness, newpharma.dk

VækstfondenCopenhagen Business School

New Pharma

“In the late 1990s there was relatively easy access to venture capital. There was a strong belief in the new technology, and there was access to public financing from the Danish Growth Fund. Zealand Pharma managed to raise 175 million in seed capital in 1998.”Eva Steiness, newpharma.dk

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Why do ecosystems emerge in some places and not in others?


The key question is:

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There must be good framework conditions for entrepreneurship including access to the necessary resources in terms of knowledge,

skills and capital

This is the case in many places in the world

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Large established companies must be open and play an active role in the ecosystem


But

And successful entrepreneurs must stay in the region and reinvest their time and resources in

the ecosystem

to make a difference

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COMPETENCIESCAPITAL

KNOWLEDGE

SUPPORT

UniversitiesCompanies

Advisors

VenturecapitalistsStart-up phase3-10 1-2 years

Growth phase10-40 2-5 years

Support

Capital

Competencies Knowledge

Scalable phase500+ 5 years +


Support

A model of the Ecosystemoption 1 option 2

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COMPETENCIESCAPITAL

KNOWLEDGE

SUPPORT


Advisors



Support

Capital




Support

option 3

A model of the Ecosystem

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Start-up phase3-10 1-2 years




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COMPETENCIESCAPITAL

KNOWLEDGE

SUPPORT


Advisors



Support

Capital




Support


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COMPETENCIESCAPITAL

KNOWLEDGE

SUPPORT


Advisors



Support

Capital




Support


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that strong ecosystems develop randomly -

based on our findings, we will argue that this could happen by intent anywhere

Until now it has been a widespread assumption

BUT


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CALL FOR ACTION

Who should act?

Established companiesVenture capitalists

PoliticiansUniversities

INTRO ECO-SYSTEMS REPORTS ACTION

2012

Established companies gain from being located in a strong ecosystem

Established companies


Partnerships and collaborations between established companies and entrepreneurs are

beneficial for both

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Circulation of employees is an advantage for both entrepreneurs and

established companies


Support and collaboration with universities fertilises the whole ecosystem

Spin-outs are an important building block in the ecosystem

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Capital


Capital has a special responsibility to get the right management team in place

Venture capital has an important role to secure that the founder is part of the

whole journey

Capital has more investment opportunities in strong ecosystems

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Venture capital plays a crucial role in creating successful entrepreneurs with financial

resources that stay in the region and bind the ecosystem together

Pension funds have a long term interest in a strong venture capital industry

Entrepreneurship is a repeated business, and venture capital has a special responsibility to

bring the experience further

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Building a new industry requires large investments from pensions funds

and other capital funds

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Universities benefit from taking an active part in strong ecosystems

Universities


Universities gain from partnerships and collaborations with

entrepreneurs and established companies

University spin-outs are important for developing the ecosystem

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Universities can benefit from dedicated entrepreneurship centers

with the task of interacting with the ecosystem


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Politicians


Politicians have an unique opportunity to put ecosystems on the agenda and raise awareness

about the importance of strong ecosystems

Politicians can encourage public owned companies and institutions to be active in

the ecosystems

Politicians can ensure that public owned universities are active in the ecosystems

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SIGN UP!


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SIGN UP!

INTRO ECO-SYSTEMS REPORTS

www.foragroup.dk

ACTION

http://www.foragroup.dk

http://www.foragroup.dk

2012

Thank You!

Ecosystems presentation

Documents

best ecosystems

intro ecosystems reportsit

new biotech companies

good business ecosystems

young companies

fastgrowing new companies

introbecause new companies

valid ranking of ecosystems