Week of December 13 - December 17, 2004

Welcome to the National Dialogue on Entrepreneurship, an initiative of the Public Forum Institute made possible by a grant from the Kauffman Foundation of Kansas City. Through NDE-news, we bring you short summaries and analyses of various trends driving the innovation economy. Subscribe now to receive your weekly copy. Archived issues are available online. Links to the day's entrepreneurship stories from across the nation and around the world are posted each weekday on the NDE main page - bookmark it and stay informed about the latest entrepreneurship news. 

The Changing Demographics of Entrepreneurship

New reports from the Center for Women’s Business Research and the Small Business Administration (SBA) offer further confirmation of the boom in entrepreneurship among women and among America’s minority population. The Center for Women’s Business Research has recently released Businesses Owned by Women of Color in the United States, 2004. This annual study reviews the latest Census Bureau data on business ownership, and this year’s findings are quite interesting. Between 1997 and 2004, the number of privately held firms owned by women of color grew by 54.6%. Meanwhile, the overall number of firms in the US grew by only 9% over this period. These new firms appear to be prospering as both employment (up 61.8%) and sales (up 73.6%) also grew during this period. Women’s business ownership is up among all groups, but the number of Hispanic (up 63.9%) and Asian owned firms (up 69.3%) has grown especially fast. 

Meanwhile, SBA researchers have released new numbers on self-employment in the American economy. Self-Employed Business Ownership Rates in the US, 1979-2003, by University of California-Santa Cruz researcher Robert Fairlie, notes that, in 2003, 12.2 million Americans were self-employed. This total represents a large jump of 6.2% from the total number of self-employed Americans identified in 2000. Since the 1970s, self-employment rates have grown at a steady rate, but the self-employed have consistently made up somewhere between nine and ten percent of the American workforce. The biggest changes have occurred in the backgrounds of the self-employed. In 1979, Hispanics accounted for only 3% of total self-employment. In 2003, they account for 8% of the self-employed. Similarly, women now account for 31.5% of the self-employed. In 1979, they represented only 22.5% of the total. On a regional basis, self-employment is more prevalent in the Western part of the US, where self-employment rates are 1.8% higher than national averages.

To learn more about the Center for Women’s Business Research study, Businesses Owned by Women of Color in the United States, 2004, visit http://www.nfwbo.org/pressreleases/11-16-2004/11-16-2004.htm

To access the 2004 SBA Office of Advocacy report, Self-Employed Business Ownership Rates in the US, 1979-2003, by Robert W. Fairlie, visit http://www.sba.gov/advo/research/rs243tot.pdf

Boosting Microfinance

Many new entrepreneurs may have an easier time getting capital if ideas from the Grameen Foundation USA take hold. The Grameen Foundation USA is a branch of Bangladesh’s well-known Grameen Bank, one of the early pioneers of microfinance – typically loans, savings and other financial services tailored to meet the needs of the poor. The foundation has produced a new report Tapping the Financial Markets for Microfinance that offers a primer on how banks and other large financial institutions can effectively back micro-entrepreneurs. A huge potential market exists. Grameen suggests that global demand for microfinance exceeds $300 billion, yet only $4 billion is now expended in these markets. This huge gap can only be filled by major financial markets, and the report details a host of ways that investors effectively and profitably work in the field of microenterprise. 

The October 2004 Grameen Foundation report, Tapping the Financial Markets for Microfinance, by Jennifer Meehan, is available at http://www.gfusa.org/docs/programs/GFUSA-CapitalMarketsWhitePaper.pdf

European Innovation Scorecard

The European Commission has recently completed its fourth annual European Innovation Scorecard that tracks the innovation capacity of 33 countries, including all 25 European Union (EU) members. The scorecard tracks twenty different measures that assess performance in areas of human capital, innovation finance, knowledge application and knowledge creation. Overall, the report finds that the US and Japan still outperform most EU member nations. Japan ultimately ranks at the top of the summary 2004 innovation index. Within the EU, the best performers are Sweden, Finland, and Denmark. Among new EU members, Slovenia and Estonia perform quite admirably. This detailed and sophisticated analysis shies away from policy recommendations, but it does find that the US and Japan’s lead is largely determined by stronger performance in three areas: patenting, higher education, and private R&D expenditures.

To access the European Commission Staff Working Paper, European Innovation Scorecard 2004: Comparative Analysis of Innovation Performance, (released November 19, 2004), visit http://trendchart.cordis.lu/scoreboards/scoreboard2004/eis_2004.pdf

The State of Technology Transfer

Each year, the Association of University Technology Managers (AUTM) releases a survey of technology licensing at major American universities. The 2003 edition is just out, and it contains some interesting data. University-nurtured start-ups were down in fiscal year 2003, feeling a 6.7% drop from the previous year. Those results don’t seem to impact university views of technology transfer as budgets for such efforts were up over the same period. Staffing levels at technology transfer offices grew 8.2%, and research budgets grew by 10.1%. Technology transfer programs have succeeded in boosting patent applications (up 8.2%), licensing income (up 5.5%), and invention disclosures (up 7.7%). 

The full AUTM Licensing Survey: FY 2003 is available for purchase from AUTM at www.autm.net. A detailed survey summary is available at the site by clicking on the “Surveys” button at the top of the page.

Kauffman, Disney Team Up Again to Create ‘Opportunity City’

If you’re traveling to Florida for the holidays, you may want to check out ‘Opportunity City,’ a new exhibit at Epcot at the Walt Disney World Resort. Bringing to life the ‘Hot Shot Business’ simulation – an online venture by Disney and the Kauffman Foundation of Kansas City – the Opportunity City exhibit consists of several activity stations, including state-of-the-art interactive kiosks. At each station, guests play a series of games where they must think and act quickly while learning what it takes to run a successful business, including a video “D-Mail” station (Disney video e-mail) called “Creating the Buzz,” which highlights key marketing skills by allowing visitors to film a commercial for their new business and e-mail the video home.

The Hot Shot Business simulation game is available online at www.hotshotbusiness.com. For more information on Opportunity City, including images from the exhibit, visit http://www.kauffman.org/items.cfm/603. 

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