Startup Ecosystems (III)

Although there are multiple rankings that value ecosystems based on various parameters (Access to finance, education, quality of life, number of unicorns, GDP…), in this analysis I want to present a series of ecosystems taking into account the particularity of each one and highlighting the different exportable success factors to other ecosystems.

Specifically what we can use in the incipient Basque Country’s ecosystem…

AUSTIN

Austin is one of the fastest growing cities in the US and offers startups a wide array of market opportunities and access to capital. Thanks to that, it has earned the “Silicon Hills” moniker in recent years, named after the Central Texas region’s signature hill country.

In Surge Cities Index analysis, it ranked third in the U.S in population growth, third in its density of high-growth companies and sixth in its rate of job creation. It is also ranked the 19th best startup ecosystem in the world according to Startup Genome.

We could say that all started in 1937 when IBM opened a sales office in Austin. After that, thousands of tech companies have established offices in Austin:

• Dell Technologies was born in 1984 in Austin and currently employs 138.000 workers worldwide, of which 13.000 are in the Central Texas region.
• Samsung planted its first chip manufacturing center in 1996.
• Apple has also had a presence in Austin for over two decades now. There are 7.000 workers currently employed by Apple in Austin and last year Apple broke ground on a $1 billion campus in North Austin, with capacity for 15.000 employees.
• Thousands more are employed by other tech giants: Facebook has over 1.000 employees in the Austin area, Amazon has 5.600, and software company Oracle has 5.000 in its new waterfront campus.

And recently, Austin has attracted the likes of Tesla, Dropbox, Palantir, and SpaceX, among others.

Another completely different seed of entrepreneurial culture is thanks to the Austin Technology Incubator (ATI), the deep technology incubator of The University of Texas at Austin. It is the oldest active technology incubator in the country and to date it has launched more than 300 graduate companies and has generated more than $3 billion in economic impact in Texas.

For decades, ATI focused on three industries: hardware, software and semiconductors. Industries that are now part of Texas’ global reputation.

Exportable to other ecosystems:

• Less competitiveness landscape than its main competitor (Silicon Valley), which allowed the establishment of technological giants.
• Fostering a culture of entrepreneurship is one of the most powerful ways universities can do as economic accelerators, which in turn drives the future of economic stability and creation of new businesses.

ZURICH

Switzerland is not only the land of mountains, lakes, watches, and chocolates. While Zurich’s status as an international investment and finance hub remains its forefront for economic activity, in recent years it has picked up pace as a leader in European entrepreneurship.

Up to date, there are around 50.000 people working in the ICT cluster of five thousand companies in the canton of Zürich, including Google Research and IBM Research. Also, Greater Zurich has developed into a very attractive location for startups because it offers the three important ingredients for an attractive startup ecosystem: talent, capital and customers.

With good general conditions and a high quality of life, the Swiss attract the best minds in the world. Zurich is home to some of Europe’s most innovative universities, including the Swiss Federal Institute of Technology (ETH), the University of Zurich and the Zurich University of Applied Sciences.

These universities help the city draw on a young and innovative workforce to sustain its growing startup field, having created more than 2.500 jobs by ETH in recent years.

15 Fortune 500 companies are headquartered here and over 70.000 companies are registered in Zurich. Startups in Zurich have a strong local market to sell their services and products to, with a wide range of large and small companies directly on site offering founders direct access to potential first customers.

Finally, access to capital is another key factor contributing to a burgeoning startup presence in Zurich. In recent years the city has seen an increase in the number of venture capital firms, investors and the launch of a number of programs and meetups that help investors collaborate and exchange ideas, helping drive business innovation and networking at a grassroots level.

Exportable to other ecosystems:

• The power of university, as the startups are created near the universities.
• A business-friendly environment, corporate connection and a friendly climate for Investors.

SINGAPUR

From a geographical point of view, Singapore is strategically positioned as an entry point to the Asia-Pacific region, with its port being a major center for trade and logistics.

As a small country with limited natural resources, its economic growth depends on adopting innovative and technological approaches, which is why it has managed to create strong research institutions and a good reputation for ease of starting businesses.

From big company headquarters of global companies to fledgling startups, everyone seems to want to be in Singapore these days, but why?

It takes about 20–25 years for a vibrant startup ecosystem to develop in a city. This is clearly reflected in Singapore, where local government funding policies began in the 1990s and thanks to them Singapore achieved the 12th position on Startup Genome’s 2017 Startup Ecosystem Ranking.

Its startup-friendly policies include subsidies and a range of incubation schemes, as well as access to significant government funding through more than 10 funding bodies,including: SPRING Startup Enterprise Development Scheme, the Technology Incubation Scheme, the Early Stage Venture Fund Scheme and the Sector Specific Accelerator Programme, among others.

Other types of advantages and plans that the local government has put in place are:

• The Research, Innovation and Enterprise (RIE) 2020 Plan, with SPD 19 billion for investment in R&D over four years.
• And the Tax Exemption Scheme for new startup companies, introduced in 2005 and to be tweaked as of 2020.

In terms of the human resources required by startups, Singapore’s excellent education facilities encourage students to explore their entrepreneurial potential and founding their startups. Their clear commitment to talent and education is reflected every year occupying the head of multiple rankings, both in the university field and in primary education.

Moreover, this policy complements perfectly with Singapore’s liberal approach to welcoming skilled professionals, executives and entrepreneurs from abroad.

Exportable to other ecosystems:

• Long-term commitment by the government in the creation of a startup ecosystem
• Commitment to talent, education and advanced research