UNDERSTAND | October 27, 2017

Report on Slovakia Provides Menu of Comprehensive Entrepreneurship Policy Recommendations

Photo Credit: Flickr | Miroslav Petrasko

Paulo Andrez, GEN Portugal Chair, Leads EU Startup Policy Team

When the government of Slovakia asked the European Commission – the operational arm of the EU – for guidance on how to boost its nascent startup ecosystem, the EC asked Paulo Andrez – the chair of GEN Portugal’s board of directors – if he would lead an expert team to Bratislava. Andrez is an entrepreneur turned angel investor and the founder of DNA Cascais Incubation Centre. A preeminent expert on ecosystem development, he advises governments on designing and implementing entrepreneurship and innovation policies.

The Slovak government asked Andrez and his team to provide solutions to three main questions:

  1. How to improve the business environment to promote entrepreneurship and startups?
  2. How to improve business incubation and acceleration?
  3. And how to increase the existing small community of business angels?

“The starting point,” Andrez said, “is to see the startup sector in terms of an ecosystem. In Slovakia, the sector is small but fully fledged, displaying a number of co-working spaces, incubators, venture capitalists, business angels, etc.” The country needs to build on this base in order for the sector to grow and contribute to transforming the country’s economy into one that is modern and innovation-driven.

Slovakia can develop “a self-sustaining system that fosters innovations and entrepreneurship,” explained Andrez, “by encouraging rather than substituting the existing actors, building trust among the key stakeholders, taking measures to ensure that private investors are not crowded out, and reforming the business environment.”

Andrez says it is important that Slovakia’s startup ecosystem be considered in the context of a broader European ecosystem, which the Commission has sought to frame through a number of initiatives:

Andrez’s expert team worked for six months to develop 21 detailed, specific recommendations – grouped into six principal policy messages, – and a road map for their implementation. Each are detailed in their comprehensive report. Below is an overview of each:

  1. Manage the startup ecosystem by creating a “connecting hub” that links stakeholders, provides information on support measures, and helps the ecosystem to learn fast by setting up communities of practice. (This is precisely the need that GEN’s in-country affiliates are positioned to address.)
  2. Go for radical reform and improvement of regulation rather than incremental reforms of the business environment, which can go unnoticed. Accelerating the change process will “bring visibility to Slovakia and attract outside investors."
  3. Provide targeted public funding support for demand- and success-driven incubation, with a program for the development of public and private incubators based on accreditation.
  4. Establish a brokering service to help Slovak companies gain access to international accelerators, which provide mentoring services and a client base, while supporting a privately operated internationally oriented accelerator in a selected smart specialization area.
  5. Incentivize university-developed technology transfer, spin-outs, and the commercialization of research – require that universities prepare a technology transfer strategic and action plans.
  6. Mobilize private funds for startups by supporting the creation and professionalization of business angel networks, a national federation of business angels – develop a certification process for business angels.

In addition, Andrez suggested that the government set clear key performance indicators, and benchmark key ecosystem components using international best practices and resources. Two GERN-endorsed collaborative data generation and analysis projects – Ecosystem Connections Mapping and Entrepreneurial Mindset – are specifically designed to do just this.

In addition, Startup Genome has developed a robust methodology for conducting thorough assessments of city-based ecosystems. This is exactly the kind of up-to-date data that benchmarks a given ecosystem against a large peer group, and provides clarity to policymakers as to what actions they can take to grow their ecosystem faster.

“The opportunities for learning from others’ experience and gaining valuable advice from fresh perspectives are real,” Andrez noted. His team recommended models from a wide variety of countries, including Austria, Denmark, Estonia, Finland, the Netherlands, Poland, Portugal, Spain and the United Kingdom.

The Minister for the Economy of the Slovak Republic, Dr Peter Žiga, told the EC that Slovakia is currently changing its strategy for competitiveness, intending to move from a cost-based to a research and innovation driven, quality-based model. “We are committed to implementing new policies to develop the current start-up ecosystem,” Žiga said. “I am sure that these recommendations will have a significant impact.”

The work of Andrez’s team was made possible by the European Commission’s Policy Support Facility, which is part of the Framework Program for Research & Innovation “Horizon 2020.” On request, the PSF supports EU member states and associated countries in improving the design, implementation and evaluation of their national research and innovation policies and systems.

The success of the policy mission led the EC to ask Andrez if he would lead a team to Romania. Currently, he and a team of experts are examining Romanian policies that influence acceleration, incubation, business angel, and venture capital rates. We will distribute their report as soon as it is available.

Peter focuses on building the Global Entrepreneurship Network's capacity to impact entrepreneurship ecosystems around the world. For the Global… About the author