Startup and SME Technology Entrepreneurs

Just saw this report from 1000startup.eu (#startupRadicals)

https://docs.google.com/spreadsheets/d/1bfC0XRWU5YSnrE520SH5z8L-rH0dLe2dLdY-3NwzjbM/htmlview?pli=1

This are very insightful numbers telling us about overhyped “startup” phenomena — for which we as a society still did not constructed meaning.

Numbers in this report are aligned with my hypotheses that “startups” are financial market products. And they are handled by financial industry (the same one which bring us to recession we are living in).

So what this number tell us ?

1. that there were 855 investments or deals in EU.
2. Report pointed toward the difference between US and EU numbers, comparing the VC investment per capital (EU aprox 11 US$ and 141 US$ in US)
3. That this investment are in EU 0,03% of GDP and in US 0,27% GDP

But if we put those numbers in SME or EU entrepreneurial ecosystems context — we could have different picture.

Lets look on another published report by EU

http://ec.europa.eu/growth/smes/business-friendly-environment/performance-review/files/supporting-documents/2014/annual-report-smes-2014_en.pdf

And some key numbers are

1. 132 M of people in EU employed by SME
2. 3,6 trillion EUR— Amount of value added generated bySMEs(equivalent to 28%of EU GDP)
3. there are aprox 21M of companies

As “startups” are mostly based on knowledge and technology advances — let try to see what is the participation of technology and knowledge in those numbers.

About 30% of SMEs in the services industry are operating in knowledge intensive activities, and they generate more than a ⅓ of total value added produced by SMEs in services sectors.

In the EU28, in 2013, only 2% of manufacturing SMEs were involved in high‐tech industries

So to calculate briefly we come to following

1. 3.84 M * 30% = aprox 1,152,000 companies in Biz Services are knowledge intensive (employment — 2,835 M of people)
2. 2.1.4*0.02 = 41,600 companies in Manufacturing (employment — 357,000 of people)
3. In High tech manufacturing and knowledge intensive service SMEs, =Total = 3,192 M of people working in aprox 1,2 M companies

All of them have their problems (list of issues could be found in report)

And what those numbers are telling to us ?

We are comparing

855 deals (of VCs)

vs

1,2 M companies (employing 3.192 M of people)

Question to consider:

How often in public is mentioned startup and how often technology entrepreneur?

And even more important thing we have to ask ourself is why it is that way ? Short hint; who have the interest in pushing “startup” in public discourse ?

And at the end — what is difference between startup and technology entrepreneur(ship) ?

Sergej Lugovic

Remark: I edited Croatian version of book Technology ventures covering topic of technology entrepreneurship. But I also worked in internet incubator in London in 1999–2000.