Germany is home to many institutionalized local entrepreneurial networks whose aim is to strengthen entrepreneurial ecosystems in the local area and support founders throughout all phases of their projects. Some of these networks have formed as part of Global Entrepreneurship Week Germany, while others have been in place since as far back as the late 1990s.
Our overview map shows entrepreneurial networks that are already familiar to us. It will be updated on an ongoing basis.
The networks studied vary greatly in size, depending on where they are based and how many relevant organizations exist in the local area as potential members. Network size ranges from five to nearly 30 members, while most networks have between ten and 20 members. One very positive sign is the good resonance these networks have had locally, which respondents say has led to active network participation by all of the larger relevant organizations and institutions in the local area.
But what do we mean by “relevant” organizations? According to our definition, entrepreneurial networks and their members cover as broad a range of supporting services as possible, with a low threshold for participation, along with covering the main areas of the entrepreneurial ecosystem. Members of the entrepreneurial networks include:
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Employment agencies / job centers
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Chambers of commerce and industry / chambers of crafts and trades / chambers of architects
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Organizations of junior business talent
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Banks and financial institutions
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Universities / higher education institutions / universities of applied sciences / private educational institutions / adult education centers
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Coworking spaces
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City and municipal administrations
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Business development organizations
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Technology and innovation centers
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Initiatives and associations from the startup scene
One topic that comes up in almost all networks is how to deal with commercial providers within the startup scene, such as advisors and consultants, since most networks want to keep the threshold for participating in what they offer as low as possible, without charging fees. One possible model is not to integrate advisors and consultants into the network as firm partners, but to include them in individual events and advising offerings.
Because what they offer has a low threshold for participation, most networks have only very limited financial resources at their disposal. In most cases, personnel resources are provided by the organization that is responsible for coordinating the network. Otherwise, project-related financing of events or other offerings takes place, with the partners involved in the specific case bearing a share. Regular payment of dues or fees for network membership is unusual. If these kinds of fees are charged, there are different models: Either all partners pay a modest flat fee, or partners pay on a sliding scale depending on their size and financial resources.
The networks pursue a range of different goals in their work (but very few of them have entered into specific agreements on goals among them). Especially in rural regions, one of the challenges is to highlight development opportunities in the local area, especially for young people, while keeping business founders in place and thereby preventing potential and talent from draining away from the area. Spurring greater dynamism in innovation and business ventures and creating new jobs are important topics, especially in areas with structural weaknesses. Urban entrepreneurial networks also prioritize raising their profiles as startup locations beyond the local area.
In principle, all entrepreneurial networks share one overarching aim: to have a positive influence on the development of the overall economy, enhancing the economy through more vibrant innovation and startup activity.
Are the networks successful in reaching their goals? Success criteria are fundamentally difficult to measure in the case of measures that focus primarily on raising awareness and networking. Entrepreneurial networks, too, also face the challenge of demonstrating the success and effectiveness of their activities with figures. It is difficult to impossible to prove a direct connection to specific founder numbers on a serious basis. As a result, many networks measure the numbers of events and/or event attendees as a success criterion. It is especially pleasing when participant numbers regularly exceed expectations – and, in some cases, even available capacity. Access to online offerings such as the network’s website can also be used as a measure, along with proactive inquiries that reach the network because of its prominence. Some networks also mentioned network partner satisfaction as a success criterion.
Although they measure their effectiveness by different criteria, all of the networks surveyed are unanimous on one thing: They all rate their work as networks as successful, across the board.
When asked about the network’s added value for entrepreneurs in the area, most networks point to improved coordination of offerings, especially advising and consulting options, and closer connections between partners – who, in some cases, compete with each other in other areas. The advantage of a shared external presence is also mentioned, as it can help to boost transparency among the crucial institutions responsible and allow business founders to find the right point of contact faster. Joint organization of events, especially large-scale ones, is also viewed as adding value, and services to put people in touch with exactly what they need and provision of comprehensive training and qualification offerings are also mentioned.
It is interesting to turn now to what motivates the respective partners to get involved within the network. The following reasons/motivations are among those mentioned: information, sharing of ideas/knowledge, access to target groups, interdisciplinary work, eliminating duplicate structures, economic advantages, and access to resources.
Aside from these “hard facts,” respondents also show a great intrinsic motivation, in conversation, to work together with like-minded people toward a shared goal and have a positive impact on the region together.
The subject of connecting medium-sized businesses with young, innovative enterprises is growing increasingly important right now. Small and medium-sized enterprises (SMEs) are not directly involved in the entrepreneurial networks surveyed. Still, most networks view contact with established businesses as important, and they certainly see the benefit of cooperative activities between entrepreneurs and medium-sized businesses in the local area. As a result, contact is made possible at different levels in some cases, for example via partnerships with local chambers of commerce and industry.
Because of their limited resources in terms of personnel and time, and because they are scattered across different regions, the networks have tended to work in isolation so far – dialogue with other networks is uncommon, and if it does take place, it is at irregular intervals. The networks did not gear their activities toward a certain model or best practices during development or in the startup phase, nor do they share experiences with other networks in their day-to-day work. Most networks did show an interest in this kind of dialogue – provided that it is compatible with their heavy workloads.
note: our title is a quote of this initiative by Munich startups: http://ittakesacity.de/