The Entrepreneur  in the Tech Economy

The Entrepreneur in the Tech Economy

November 18, 2016

There can be no question - entrepreneurship has become trendy all over the world. The entrepreneurial spirit began in Silicon Valley, before spreading to quickly to Europe and on to Asia. Along the way it was successful in winning over both mature and emerging markets. Currently, about 70 incubator structures exist in France, in 2010 there were a mere 10. In Germany, nearly 50 are thriving at present, up from 12 in 2010.

In the past few years funding for start-ups has increased significantly. In the UK it has risen from USD 2bn in 2013 to USD 5bn in 2015. New companies, incubators and accelerators are heavily supported by governments and public organizations. Meanwhile startup creator spaces are sprouting up all over the globe. Corporates are learning to collaborate with and even build startups on their own, and investors have a seemingly insatiable appetite for new ventures.

Incubator structures on the rise

Incubator structures on the rise

These developments can be explained by various environmental changes. Technological progress is huge and capital is plentiful, following the decision to pump more money into our economies in an attempt to resolve the global economic crisis of 2008-2009.

Investment is cheap and tech innovation the new Holy Grail - with the first unicorns emerging in 2009. Since then, their numbers have climbed to over 180 around the world, with a total valuation of more than USD 740 billion.

Digitization and new forms of telecommunications make the world a huge marketplace, where all kinds of products and services are exchanged rapidly and non-bureaucratically via the internet. It may well be cheaper to look outside your organization for a service rather than inside. Consumers can take control with the help of technology. Our smartphone has become the ‘remote control of our lives’. We are slowly moving from a B2B & B2C to a C2B & C2C environment. This goes hand in hand with the rise of Generation Y and Z who want to be free and independent above all. Therefore, the social contract is changing, too.

We are witnessing the emergence of ‘forever startuppers’ - people who create and create again, regardless of whether they fail or succeed with their projects, rather than become employed. It also creates ‘rented execs’ - independent interim managers, who provide their specialized expertise. This is cheaper for corporates, and allows for more flexibility.

As a consequence of their newly acquired freedom and independence, individuals have to deal with increasing solitude and pressure to perform. As trust is the new currency, businesses must create a fresh sense of belonging for their non-employed staff and partners as part of the ‘ Light Footprint Approach ’ that implies an advanced organization, full use of technology and a more entrepreneurial corporate culture.

Despite the fact that we are making huge progress towards an entrepreneurial society, we have not solved all our economic problems.

Rather, we can see a large gap between the ‘ordinary’ people and the small number of ‘insiders’, who are going out on a limb in the hope of becoming millionaires or billionaires. This raises pressing questions of social inequality and justice and it is our duty to find suitable answers. Apart from the economic aspects, we have to ask ourselves more - do we really need this emerging technological innovation? Will it help us to have a better life? Or are we just pushing it for the sake of creating something new and intriguing?

Joseph Schumpeter once described the entrepreneur as the representative of the ‘real economy’ – as opposed to the financial sector, which is supposed to provide support but not dominate the markets. My concern is - are today’s (tech) entrepreneurs as real as they should be?

This is an abridged version of an article which originally appeared in the Global Peter Drucker Forum blog.