This document discusses business ecosystems and how they emerge in some places but not others. It summarizes three reports on ecosystems: 1) A benchmark report comparing ecosystems in the US, Canada and Europe based on indicators like venture capital and patents. The best ecosystems are located in the US. 2) Travelogues interviewing people in strong and less strong ecosystems, finding that open companies and serial entrepreneurs who remain in the region are important. 3) A report on the Danish biotech ecosystem, which is large but behind US clusters due to a lack of experienced management teams to scale companies. The document argues that ecosystems can be intentionally developed if large companies, venture capital, universities and politicians all actively

1. INTRO
Understanding business ecosystems
2012

2. INTRO
Fast growing new companies are important for jobs
and wealth
Entrepreneurs are a key mechanism for
turning knowledge into products and jobs
Entrepreneurs are a key driver for
competition
2012

3. INTRO
Denmark has a major challenge in scaling up
new companies
We need to meet this challenge to create jobs
in the global knowledge economy.
2012

4. INTRO
In Denmark, very few companies realise their
global potential compared to the US
Source Nordic Entrepreneurship Monitor, Fora 2010
2012

5. INTRO
In Denmark, new companies account for 9% of the
employment. In the US, new companies account for
25% of the employment.
DK USA
More than 10 years old 1-10 years old 0-1 years old
Source Ibsen og Westergaard-Nielsen (2010): Job creation by Firm in Denmark & Haitiwanger og Miranda (2010): Who Creates Jobs? Small vs. Large vs. Young.
Se FORA (2010): Den danske produktivitetsudfordring.
2012

6. INTRO
In the US about 90 young companies each year
reach more than 1000 employees.
In Denmark, it has not happened in many years.
For Denmark to match the US
1 or 2 young companies must every year reach
more than 1000 employees
Source Nordic Entrepreneurship Monitor, Fora 2010
2012

7. INTRO
In the US, some regions are good in creating fast
growing new companies while some regions are not.
Why do these new high-tech clusters
emerge in some places and not in others?
2012

8. INTRO
Because new companies succeed in
good business ecosystems
which only exist in some regions
2012

9. INTRO
But what is an ecosystem?
2012

10. INTRO ECOSYSTEMS
Can the ecosystems in nature help our
understanding of business ecosystems?
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11. INTRO ECOSYSTEMS
We asked three questions
about business ecosystems
Why do strong business ecosytems emerge
in some places and not in others?
How strong are the Danish business ecoystems
compared to best practice?
How can business ecosystems be reshaped?
2012

12. INTRO ECOSYSTEMS REPORTS
This study has been summarized in
3 reports
Benchmark Report
Travelogues
Danish Biotech Ecosystem
2012

13. INTRO ECOSYSTEMS REPORTS
Benchmark Report
We have benchmarked regional
ecosystems in IT, Biotech and Cleantech
in USA, Canada and Europe
The benchmarks are based on 4 indicators:
Dealmakers, Venture capital,
Patents, Location coefficient
2012

14. INTRO ECOSYSTEMS REPORTS
It seems possible to make a valid ranking of
ecosystems based on the four indicators.
The best ecosystems are located in the US.
Europe has no ecosystems that match the best
ecosystems in USA
2012

15. INTRO ECOSYSTEMS REPORTS
Seattle
Northern Europe
Minneapolis
Boston
Chicago
Denver
Silicon Valley
Research Triangle Park,
Raleigh-Durham
San Diego
Phoenix
Austin
USA Stockholm
Copenhagen
IT & Tele Biotech Cambridge
Ecosystem ratings for USA and Northern Europe
Source: Own calculations London
2012

16. INTRO ECOSYSTEMS REPORTS
Travelogues
We have interviewed people in
strong and less strong ecosystems in US.
Some of the interviewed have helped
create the ecosystem or have been
key players in the ecosystem.
2012

17. INTRO ECOSYSTEMS REPORTS
Strong ecosystems emerge when open and
innovative companies - mother companies - are
active in the ecosystem
AND
When successful entrepreneurs -
serial entrepreneurs - remain in the region and
reinvest time and resources
2012

18. INTRO ECOSYSTEMS REPORTS
Groupon has been a big success, and the
Seattle, Washington
company founders are Chicago guys who
will stay and invest in Chicago.
CHK Conversation with Craig C. Bradley,
“The ecosystem in Seattle started Edwars Wildman
growing only when Amazon and
Starbucks started with their open
and innovative culture.”
Conversation with Franck Nouyrigat, Chicago,Illinois
Start-up Weekend Seattle
Denver, Colorado
”The serial entrepreneurs are an
Research Triangle Park, North Carolina
important element in the ecosystem.”
Paul Jerde, Leeds School of Business
“If SAS Institute and RedHat had the same open
and innovative culture as many companies in
SiliconValley and Austin, RTP could have been
one of America's very successful entrepreneurial
regions.”
Amit Singh, entrepreneur of Indian origin, 800
employees, including 50 in RTP
2012

19. INTRO ECOSYSTEMS REPORTS
Danish Biotech Ecosystem
We interviewed key players from the emergence of
Danish biotech
International data on employment, venture capital
and university research illustrates the standing of
the Danish biotech cluster
2012

20. INTRO ECOSYSTEMS REPORTS
The biotech cluster in Copenhagen is one of
the biggest in Europe, but far behind the best
clusters in the US
The reason for the relative success was access to
venture capital and experienced professionals
from established companies e.g. Novo Nordisk
2012

21. INTRO ECOSYSTEMS REPORTS
The reason Copenhagen is behind the best
US clusters is a lack of experienced
management teams to scale the new
biotech companies
2012

22. INTRO ECOSYSTEMS REPORTS
“In the late 1990s there was relatively easy
access to venture capital. There was a "It can be a challenge to become CEO of a
strong belief in the new technology, and new biotech company for an employee e.g.
there was access to public financing from from Novo or Lundbeck if they have not been
the Danish Growth Fund. Zealand Pharma part of the management team where the
managed to raise 175 million in seed strategic overview is often developed."
capital in 1998.”
Eva Steiness, newpharma.dk
Eva Steiness, newpharma.dk
“Many of the leading Danish biotech companies
started from 1998 to 2001. It was especially
talented people from Novo, who had some great
ideas and got a pat on the shoulder from the
company. This has undoubtedly contributed to
the Danish biotech cluster being among the
world's largest clusters today.”
Vækstfonden New Pharma
Christian Motzfeldt, Vækstfonden Copenhagen Business School
"The culture in the big companies play an important role in Danish biotech. It is
important that employees can go out in a new business during a period without the door
being closed behind them. Established companies can be important birth attendants
when their employees want to break new ground and start their own business."
Mads Øvlisen,Copenhagen Business School
2012

23. INTRO ECOSYSTEMS REPORTS
The key question is:
Why do ecosystems emerge in some places
and not in others?
2012

24. INTRO ECOSYSTEMS REPORTS
There must be good framework conditions
for entrepreneurship including access to the
necessary resources in terms of knowledge,
skills and capital
This is the case in many places in the world
2012

25. INTRO ECOSYSTEMS REPORTS
But
to make a difference
Large established companies must be open and
play an active role in the ecosystem
And successful entrepreneurs must stay in the
region and reinvest their time and resources in
the ecosystem
2012

26. INTRO ECOSYSTEMS REPORTS
A model of the Ecosystem
option 1 option 2
Scalable phase
Competencies Knowledge
500+ 5 years +
Support
Capital
Growth phase
10-40 2-5 years Competencies Knowledge
Support
CAPITAL
Start-up phase COMPETENCIES Venturecapitalists
KNOWLEDGE
Companies Universities
3-10 1-2 years
SUPPORT
Advisors
2012

27. INTRO ECOSYSTEMS REPORTS
A model of the Ecosystem
Scalable phase option 3
Competencies Knowledge
500+ 5 years +
Support
Capital
Growth phase
10-40 2-5 years Competencies Knowledge
Support
CAPITAL
Start-up phase COMPETENCIES Venturecapitalists
KNOWLEDGE
Companies Universities
3-10 1-2 years
SUPPORT
Advisors
2012

28. INTRO ECOSYSTEMS REPORTS
A model of the Ecosystem
Scalable phase
500+ 5 years +
Growth phase
10-40 2-5 years
Start-up phase
3-10 1-2 years
2012

29. INTRO ECOSYSTEMS REPORTS
A model of the Ecosystem
Scalable phase
Competencies Knowledge
500+ 5 years +
Support
Capital
Growth phase
10-40 2-5 years Competencies Knowledge
Support
CAPITAL
Start-up phase COMPETENCIES Venturecapitalists
KNOWLEDGE
Companies Universities
3-10 1-2 years
SUPPORT
Advisors
2012

30. INTRO ECOSYSTEMS REPORTS
A model of the Ecosystem
Scalable phase
Competencies Knowledge
500+ 5 years +
Support
Capital
Growth phase
10-40 2-5 years Competencies Knowledge
Support
CAPITAL
Start-up phase COMPETENCIES Venturecapitalists
KNOWLEDGE
Companies Universities
3-10 1-2 years
SUPPORT
Advisors
2012

31. INTRO ECOSYSTEMS REPORTS
A model of the Ecosystem
2012

32. INTRO ECOSYSTEMS REPORTS
Until now it has been a widespread assumption
that strong ecosystems develop
randomly -
BUT
based on our findings, we will argue that
this could happen by intent anywhere
2012

33. INTRO ECO-SYSTEMS REPORTS ACTION
CALL FOR ACTION
Who should act?
Established companies
Venture capitalists
Universities
Politicians
2012

34. INTRO ECO-SYSTEMS REPORTS ACTION
Established companies
Established companies gain from being located
in a strong ecosystem
Partnerships and collaborations between
established companies and entrepreneurs are
beneficial for both
2012

35. INTRO ECO-SYSTEMS REPORTS ACTION
Circulation of employees is an
advantage for both entrepreneurs and
established companies
Spin-outs are an important building block in the
ecosystem
Support and collaboration with
universities fertilises the whole ecosystem
2012

36. INTRO ECO-SYSTEMS REPORTS ACTION
Capital
Capital has more investment opportunities in
strong ecosystems
Capital has a special responsibility to get the right
management team in place
Venture capital has an important role to
secure that the founder is part of the
whole journey
2012

37. INTRO ECO-SYSTEMS REPORTS ACTION
Entrepreneurship is a repeated business, and
venture capital has a special responsibility to
bring the experience further
Venture capital plays a crucial role in creating
successful entrepreneurs with financial
resources that stay in the region and bind
the ecosystem together
Pension funds have a long term interest in a
strong venture capital industry
2012

38. INTRO ECO-SYSTEMS REPORTS ACTION
Building a new industry
requires large investments from pensions funds
and other capital funds
2012

39. INTRO ECO-SYSTEMS REPORTS ACTION
Universities
Universities benefit from taking an active part in
strong ecosystems
Universities gain from
partnerships and collaborations with
entrepreneurs and established companies
University spin-outs are important for developing
the ecosystem
2012

40. INTRO ECO-SYSTEMS REPORTS ACTION
Universities can benefit from
dedicated entrepreneurship centers
with the task of interacting with the ecosystem
2012

41. INTRO ECO-SYSTEMS REPORTS ACTION
Politicians
Politicians have an unique opportunity to put
ecosystems on the agenda and raise awareness
about the importance of strong ecosystems
Politicians can encourage public owned
companies and institutions to be active in
the ecosystems
Politicians can ensure that public owned
universities are active in the ecosystems
2012

42. INTRO ECO-SYSTEMS REPORTS ACTION
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2012

43. INTRO ECO-SYSTEMS REPORTS ACTION
www.foragroup.dk
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2012

44. Thank You!
2012