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Week of February 25 - March 2, 2008 |
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The Future of Small Business: The Artisan Economy
Intuit and the Institute for the Future have
been producing an interesting series of reports on the future of small
business. The third and final installment in the series examines the
artisan economy, predicting that artisans are set to become a major
economic force. When you think of artisans, don’t think of the
traditional image of jewelers, watchmakers or other craftspeople.
Intuit’s definition is broader and includes people with a host of
creative and technical skills. The report projects the development of a
“barbell economy,” where industry sectors are characterized by a few
large corporate players and hundreds, if not thousands, of very small
firms and entrepreneurs. Very few medium-sized firms will prosper in
this new structure. However, small firms, even solo entrepreneurs, are
well positioned to thrive in this new structure as they are best able to
provide customers with highly targeted, customized and relevant
products. The study also predicts a boom in globalized small firms. As
cross border networks grow, doing business overseas will become a fact
of life for small business. By 2018, analysts project that nearly half
of US small businesses will be involved in global trade. |
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Peer Effects and Entrepreneurship When it comes to
starting a business, it does matter who you know. New research from
Harvard’s Ramana Nanda and Stanford’s Jesper Sorenson examines how one’s
career path affects one’s propensity to start a business. The
researchers studied the career patterns of an entrepreneur’s co-workers,
using a unique data set developed in Denmark. They find that an
individual is more likely to become an entrepreneur if one’s co-workers
have started a business in the past or if their careers have involved
frequent movement between firms. The effects are strongest for those who
do not have family members with entrepreneurial backgrounds. In this
case, the experience of co-workers can sometimes substitute for effects
of family background. |
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New Business Births in Urban and Rural America
Experts have long contended that rural
entrepreneurs face unique challenges because of distance from markets
and more limited access to networks and other sources of support. New
research sponsored by the US Small Business Administration Office of
Advocacy provides some evidence that rural entrepreneurship might not be
so different after all. The study compared rural and urban business
starts using a new data series developed by the Census Bureau. The
results show few differences between business start-up rates in urban
and rural areas. Business start rates do differ across regions, but
other factors—such as local industry mix and education levels----matter
far more than whether a region is urban or rural. |
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The European Union (EU) has recently
unveiled yet another new initiative designed to help spur new business
creation. The Enterprise Europe Network bills itself as “the largest
network of contact points providing information and advice to EU
companies on EU matters.” The site is a one stop shop for small and
medium-sized enterprises seeking information on market opportunities,
support programs, potential strategic partners, and new policy
initiatives. It also includes a listing of more than 600 key partners
and support agencies for every country within the EU. |
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While adult
microenterprise programs are expanding across the globe, very few of
these efforts focus on supporting youth. A new report from Making Cents
International assesses the challenges and opportunities of building a
global youth microenterprise movement. The report notes that new
initiatives need to emphasize “livelihood development.” It’s not enough
to help youth start a business; they also need support in other key
areas such as life skills, career counseling, and financial literacy.
They also recommend that non-profits and government agencies expand
efforts to engage the private sector in support of youth microenterprise
efforts. |
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Angels Cautiously Optimistic About 2008 Despite a slowdown
in the national economy and static angel investment activity levels for
2007, angel group leaders expressed optimism about the climate for
investments in early-stage businesses in 2008 in a recent survey by the
Angel Capital Association (ACA). Not only do nearly half of angel
organizations expect deal flow to improve in both quantity and quality
this year, but they expect investment activity to continue at the same
level or increase somewhat this year over 2007. Nearly 55 percent of the
respondents said that the number of investments and total dollars
invested will increase this year, with another 32 percent believing that
the activity would be the same as 2007. Predictions for positive exits
were not as rosy. Fifty eight percent of responding angel group leaders
did not think there would be any visible change in opportunities for
acquisitions of their portfolio companies or Initial Public Offerings
this year, after fewer angel groups experienced positive exits in 2007
compared to the previous year. |
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The National Dialogue on Entrepreneurship is 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 entrepreneurship around the world. Subscribe now to receive your weekly copy. Archived issues are available online. |
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National Dialogue on Entrepreneurship
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All
stories © 2008 The Public Forum Institute
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