Spurring a New Entrepreneurial Revolution in Europe
The fear of failure, among other factors, keeps many young people from starting businesses. A look at the programs working to overcome these barriers.
As entrepreneurialism thrives in the United States, commentators in Europe are asking what must be done to nurture a start-up culture on par with America’s Silicon Valley. True, overall venture investment growth in Europe is up 73% since 2012, tracking the US within a few percentage points. Looking at funds invested in start-ups, however, shows a laggard Europe—its venture capital industry still represents only about 10% the size of the US . Determining how Europe can increase its entrepreneurial energy could be vital to resuscitating the languishing economies of many of its constituent countries—particularly as the continent looks to create new opportunities for its youth.
For Belgium, a country with a youth unemployment rate of 22.6%, according to Eurostat, building a culture of entrepreneurialism could be critical to its future.
According to Global Entrepreneurship Monitor, however, Belgium has among the lowest rates of entrepreneurial activity in the world, with only 5.4% of the country’s workforce engaged in an early-stage company. Reversing or at least redirecting this trend will be key to fostering youth entrepreneurial activity.
“We need to teach our youngsters to acquire customers rather than jobs—and, as such, focus on developing totally different skills,” says Karen Boers, managing director of Startups.be, a multi-stakeholder entrepreneurship network that serves Belgian startups, incubators, and investors. But the impetus toward entrepreneurship does not spring up full-formed within citizens—it must be cultivated at all its stages of development in societies.
Despite being having a world-class education system, Belgium, like many countries worldwide, faces the challenge of inculcating in its youth greater comfort with entrepreneurship.
“One-size-fits-all education solutions will not work anymore for the digital-native generations. We need to prepare our youth for a future that requires dynamism and flexibility,” Boers explains. This means not just helping youth to develop social and negotiating skills—and empathy—but also to help them develop the mental toughness to take risks, to tolerate failure and to forge on.
While 36% of Belgians see opportunities for entrepreneurs, the country’s fear of failure rate is 50%—the highest in Europe. By comparison, the United States, which ranks second in total entrepreneurial activity, has a fear of failure rate of 30%, at least 5 percentage points lower than any country in Europe.
“Whereas failure is perceived as a learning curve in the United States, thus breeding better and more mature entrepreneurs, it can often be the end of the entrepreneurial road in Europe. With that risk-averse culture, not daring to start at all is probably the biggest obstacle in Belgium,” adds Boers.
The Network For Teaching Entrepreneurship (NFTE) has been working to change that in Belgium since 1998. “Entrepreneurship programs like NFTE’s can help [Belgians] foster the mindset needed to recognize and create opportunities for themselves,” says Linda Chiu, Director, Licensed Partners, vice president of development at NFTE.
Working with approximately 600 young people per year through 30 dedicated teachers in 60 program sites across the country, NFTE re-engages students in learning, introduces them to business concepts, and helps them create possibilities for employment through entrepreneurship.
Such programs bode well for the country moving forward, particularly as it becomes increasingly favorable to investors. The Venture Capital and Private Equity Country Attractiveness Index ranks Belgium the 15th most attractive country for venture investment. In addition, the country’s internal venture capital scene is growing.
As of 2014, 87 venture funds € 5 million or more into Belgian start-ups. In addition, groups like Startups.be, its Failing Forward conference, the European Young Innovators Forum, and innovation hubs like Brussels-based Beta Cowork provide pathways for Belgian and European youth to discover new opportunities. Taken together, these platforms suggest how the dial can be moved even on something as deeply ingrained as an attitude toward failure. This makes the country key to watch for entrepreneurial developments both large and small.