Going big for impact: more entrepreneur-support organizations should help large businesses maximize growth
Endeavor Insight releases a new report, “Creating Capacity: Comparison of Organizations Supporting Entrepreneurship Across the World”.
Organizations that support high-impact entrepreneurs help to create new jobs and economic growth. However, not all companies are created equally. A new micro-enterprise may employ one to three people but a small- and medium-sized enterprise (SME) that becomes large will go from 20 to 35 employees to over 250. With the support of mentors, investors, and advisors, these growing SMEs can reach this threshold even faster. Despite the potential for impact, Endeavor Insight’s survey of 42 member organizations of the Aspen Network of Development Entrepreneurs (ANDE) shows that too few organizations focus on these high-impact entrepreneurs, leaving valuable opportunities to incubate economy-changing companies untapped in the process.
A 2012 survey by Endeavor Insight shows that only 26 percent of development entrepreneurship organizations are focusing on businesses that can become large and make a meaningful impact. Fifty percent may work with high-growth companies with revenue or job growth above 20 percent annually, but nearly half of these work predominately with micro-enterprises. Even a five-employee firm, on the upper end of the micro-enterprise scale, would take almost two years to make a sixth hire at these growth rates. A 250-person firm growing at the same rate would add over 100 jobs in the same period.
Supporting small entrepreneurs will always be an important element of the entrepreneurship and development toolkit, but as economies grow, entrepreneur-support organizations should be ready to build large companies with 250+ employees and strong revenue growth. Doing so will lead to greater GDP growth and will create inspirational examples for future high-impact entrepreneurs. For the 74 percent of organizations focused exclusively on micro-entrepreneurs and SMEs, thinking bigger can entrench and multiply their impact.
For more information, please read the full report here.