- density of the business startup “community”,
- proximity to high-quality academic and research institutes,
- easy-to-follow rules for business,
- government leaders who regard research and business startup as a priority, and
- possibly above all, access to funds.
(Some might say Australia lags a bit in most of these areas but focuses more on multinationals and enterprise-scale primary industry.)
Regarding access to funds, Anthony cites a research paper that challenges common beliefs about entrepreneurship. The study What Makes and Entrepreneur? by David Blanchflower and Andrew Oswald finds,
the probability of self-employment depends markedly upon whether the individual ever received an inheritance or gift…
…potential entrepreneurs say that raising capital is their principal problem.”
That might be a very serious finding for lenders and Governments to consider.
So what predicts business startup success – money or passion?
There’s no doubt that inheritance and gifts help some business people to face the risks and challenges of entrepreneurship.
However, Blanchflower’s study was conducted in 1998, before computers, tablets and mobiles became the conduits for most business and commercial activity. And before tech startups, cloud services and modern bootstrapped business redefined how people can launch a successful business startup with modest self-funding.
The true answer (and best chance of success) probably lies somewhere in the middle.
Discussing this with managers and top accountants at Etax, the consensus was this:
Government can help create the right environment by supporting education, increasing transparency, streamlining business requirements and creating financial incentives.
At a more individual level, smarts, skills and passion about a product or service, combined with access to at least modest funding and government grants or matching support, can make entrepreneurship accessible to people with a dream and motivation.”