Page 16 - Murfreesboro, TN Comprehensive Plan: Chapter 7, Economic Development

7.16 Chapter 7

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Economic Opportunity: Incubation since 1979, more than 75 percent of all new jobs created
in the United States have been generated by fewer than
and Innovation Centers 10 percent of small businesses.

Entrepreneurship is a powerful force driving innovation, ENTREPRENEURSHIP ECOSYSTEMS
productivity, job creation and economic growth. Studies Business incubators reduce the risk of small business
show that places with a high level of entrepreneurial failures, reporting success rates as high as 87 percent.
activity tend to be better off economically. The Business accelerators and incubators provide innovative,
challenge is that 50 percent of all new small businesses early-stage entrepreneurs with resources, facilities and
fail; often because they lack sufficient financing, expertise to help them develop their business plans
business networks and skilled employees in their early and seek follow-on financing. They play an important
days. Young organizations face many vulnerabilities role in the venture capital system, helping innovators
and liabilities. They may lack sufficient financing, gain strategic advantage in a competitive international
business networks and skilled employees in their early marketplace. To retain these start ups, according to
days. They may still be having problems ensuring the Harvard Business Review, the new holy grail for
consistent production quality. It takes time to develop a governments is to create an environment that nurtures
reputation in the market and a stable set of customers and sustains entrepreneurship, or an “Entrepreneurship
and suppliers. Ecosystem.” There is a growing amount of evidence that
business incubation should be tailored to a community’s
INNOVATION AND ENTREPRENEURS
character, needs and desires – there’s no magic bullet.
Numerous studies show that high-growth and “gazelle” According to Forbes, each entrepreneurship ecosystem
firms consistently outperform other businesses in the is unique, each being the result of the hundreds of
economy in terms of growth in sales and/or growth in elements interacting in complex ways. However, there
employment. Gazelles are the subset of high-growth are some basic elements that tend to appear in most
firms that are very young, nimble and light on their ecosystems, including: (1) physical space; (2) business
feet and able to seize opportunities; and ultimately are incubation services; (3) partnerships with governments,
economically important to the economy because they universities and business organizations; and (4) some
contribute disproportionately to job creation. Indeed, form of government fiscal support.