Entrepreneurship fuels innovation, leads to job creation and drives overall productivity, but despite efforts from local and state governments, the rate of entrepreneurship in the US is declining. Yasuyuki Motoyama and Jason Wiens, researchers at the Ewing Marion Kauffman Foundation, take a critical view of the efficacy of public venture funds and incubators and provide guidelines on how local governments could better support new businesses. getAbstract recommends this paper to investors, policymakers and public officials concerned about US entrepreneurship.


State and local governments typically try to encourage entrepreneurs by creating public venture funds and business incubators, methods meant to offer access to capital. However, research shows that these approaches are inept at supporting start-ups. Instead, policymakers should focus their efforts on promoting connectivity and learning among entrepreneurs, aspects that are vital to entrepreneurial growth.

To promote connectivity, local governments should encourage “catalytic events,” which offer forums to share knowledge. For example, at 1 Million Cups, “...

About the Authors

Yasuyuki Motoyama is a director in research and policy at the Ewing Marion Kauffman Foundation, where Jason Wiens is a policy director in research and policy.

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