Do Innovation Ecosystems Need Higher Education?

In my role at the head of the MIT Entrepreneurship Center, I have the great opportunity, at times, to travel the world and learn about entrepreneurship on a global scale, and to gain knowledge and perspective to help us be more effective in our mission at home. This past week was such an experience.

There is an underlying assumption that to have an innovation-based entrepreneurial ecosystem, there has to be an "MIT-like" anchor university in the ecosystem (Technion in Israel, Stanford in Silicon Valley, IIT in India). The presence of such an institution that attracts, trains, and continually feeds skilled and talented workers into the ecosystem makes perfect sense.

What if I told you of a place where there is a growing and vibrant IT entrepreneurial community, and yet it is in a country that lacks a single university in the top 500 in the world? This is exactly what I found in Romania these past few days.

As I met dynamic entrepreneurs and heard stories of their friends, a pattern emerged. Most have never studied computer science at a university; they said they did have time to do so, and that it was better to get real experience (some did not even graduate from high school). Romania is a poor country, but it is also an industrious and diverse society (both of which are important). Since people don't have much and life is hard, they have to be creative to get by and get ahead. Necessity is the mother of invention and, in this case, entrepreneurship.

There is also optimism in the air, partly a result of Romania joining the EU four years ago. That is helpful, but for now let's focus instead on the "adjita" (an Italian-American word for stomach agitation) driving things in this situation. The Romanians are learning programming without formal institutions to train them, which seems perfectly natural to them. They are driven and they have no choice. They note that Bill Gates, Steve Jobs, and Mark Zuckerberg didn't graduate from college, either (Not a great analogy, but that's how they see it). In my recent travels I have also found thriving, robust entrepreneurship in Scotland and Finland as well. Interestingly, if you ask people in any of these three countries if they are good at = entrepreneurship, their answer is "Oh, no." This very humility and scrappiness is what makes these regional groups have a higher propensity for entrepreneurship than their counterparts in, say, Germany, Russia, England, France, or Spain.

Should this surprise us?

Not really, because here in the United States, the studies of MIT professor Ed Roberts show that immigrants are more likely to start companies than more comfortable, long-term American residents.

As Eva Peron, who rose from the lowest levels of Argentine society and power to the very top, is described by narrator Che Guevarra in the immortalizing musical and film 'Evita', "Eva Peron had every disadvantage you need if you're going to succeed. No money, no cash, no father, no bright light."

So the moral of the Romanian tale is to reinforce a point made in an earlier article, that while other factors like the presence of a world class research institute close to MIT's caliber is extremely valuable, never underestimate the importance of culture in creation of an entrepreneurial ecosystem. In descriptions of such a culture, you should not see the words like "comfortable ---you should see words synonymous with scrappy. Just remember Evita.

[Note: Special thanks to my colleague Howard Anderson at the MIT Sloan School of Management with whom I discussed this topic and who also first pointed out the "Evita" quote].

 

Comments

[guveqzero]

01:50 PM on 03/06/2011

Starting service companies is much different than starting high tech manufacturing or innovation companies. The rest of the world has a leg up on the US because their governments actually encourage new high tech and innovation companies by investing in them. In the US jungle it is more who you know and how you will line their pockets. That suits the service business much better than the high tech business. Thus, we are a service nation.

[Hang Xiu Jean]

12:56 PM on 03/04/2011

Is it your very first paper about Romania? Strange... Romanian engineers are considered as the most cost-effective ones here in Europe, even if french leader - I live out there - had tremendous confusion about the quality of Romanian people and france's fears of being invaded by Romanian gypsies. And it's not just a matter of cheap (brain) work force, it's about the inner quality in sciences and especially those requiring a very high level of Mathematics, young Romanian students do have, definitely.
You could have talked about Serbian engineers, you'd write down the same praising paper. Thanks to the cold war era and its propaganda from both sides, many westeners did think and still keep thinking there was no achievement beyond the iron curtain. That's completely naive because many countries got benefits from the soviet school of Mathematics. Just to name a few: Vietnam, China, Romania, Serbia. Westerners should keep that in mind. No wonder that you don't have to be MIT or al-labeled to get respect in entrepreneurship.