Business

Entrepreneurship grows again under the impact of COVID-19

The EAE Business School published the Entrepreneurial Ecosystem in Spain study, which shows that entrepreneurial intention in Spain is sensitive to the economic cycle. Thus, this figure recorded its highest figure (around 12%) between 2008 and 2012 and, since then, it significantly decreased (around 6%) until 2015-2016, when we can appreciate a trend increase in this value and that is reaffirmed with the health crisis caused by COVID-19.

“According to INE data, the net business creation accumulated in the first half of 2021 is positive, being 57.6% higher than in 2020, and what is more significant, 8.6% higher than in 2019. In other words, companies are being created at a faster pace than before COVID-19, ”underlines David Casas, director of the Masters in Entrepreneurship and Innovation at EAE Business School.

The main motivation for entrepreneurship is to create wealth or a very high income, then make a difference and earn a living. The average age of potential entrepreneurs is 37, the consolidated average age is 40.4 and 50.08, and the average age is 48.5. The percentage of entrepreneurs by gender is converging, around 6%, reducing the gap “due to a stabilization of the male index, and an increase in the female index”, as the indicates the EAE Business School report.

Funding sources

The level of income is another characteristic which makes it possible to characterize the entrepreneurial profile because, in the early stages, an important part comes from own resources or personal savings. The initial capital required by a startup is on average € 121,000, although the mode is € 20,000, and with a standard deviation of nearly € 600,000. “These data show that there is a lot of dispersion,” says Casas.

The origin of the necessary funds comes mainly from personal (59%) and family (7%) savings, as well as from financial institutions (21%). 68% do not devote more than 10% of their assets, and only 27% devote more than 51% of their portfolio. Regarding diversification, 44% of investors have less than 5 investments. “The mode in Spain is 2, which involves a risk in terms of diversification”, specifies Casas. The most invested sectors with mobility / logistics (21%) and fintech / insurtech (16%).

The four main hubs: Madrid, Barcelona, ​​Valencia and Bilbao

In Spain, investment in startups is made in the 4 main hubs: Madrid (43.7%), Barcelona (30.6%), Valencia (9.3%) and Bilbao (6.8%). Barcelona and Madrid are clearly at the top of the ecosystem in terms of investment volume and number of investors.

Barcelona is the city that attracts the most volume, although Madrid attracts a greater number of investors. Madrid is the city with the most startups, although the one with the fewest per capita. Valence leads the ranking in terms of startups per capita, “making this city a very interesting hub”. Bilbao is also distinguished by the density of startups per capita, becoming an “increasingly consolidated hub”, explains the author of the study.

At European level, Madrid and Barcelona are among the most important entrepreneurship poles in terms of number of startups. Spain is the only country with two cities in the top 10.

The sector where the most is undertaken is that of services and consumption, 70%. The fastest growing sectors are healthcare, artificial intelligence and Propthec, while the losing momentum are fashion, marketing and blockchain.

“The COVID-19 context has revealed or reinforced new needs in terms of physical and social well-being, and at the same time new ways of solving this type of problem have emerged, generating new economic models with a strong digital component such as the video. consultations, online courses in streaming or asynchronous formats. Thus, traditional companies such as sports halls or professionals in physical and mental well-being have chosen to go digital or to join forces with technology suppliers to offer their services, ”explains Casas.

Regarding professional expectations, at 5 years, the majority estimate between 1 and 5 employees. 25% believe they continue without employees. The percentage of people who have participated in an intrapreneurial activity has risen to around 1.7% in recent years, and keeps the distance vis-à-vis independent entrepreneurship, new or consolidated. “Intrapreneurship or corporate entrepreneurship is increasingly one of the fundamental levers used by large companies to be competitive in terms of innovation. For this, it is essential to promote an entrepreneurial attitude among the company’s employees, but also to generate links with agents outside the company. with tools such as open innovation ”, underlines the author of the study.

Support and conditions that promote entrepreneurship

Entrepreneurs believe that the main supports and conditions that promote entrepreneurial activity are the existence and access to physical infrastructure and services, the existence and access to commercial and professional infrastructure (6%), government programs ( 6%) and education and training. post-school internship and R&D transfer (5.4%). Early barriers include government policies and programs, financial support, and social and cultural norms.

“Government programs have a double face of both support and obstacle, which shows the importance of developing them well. Education is seen as a support which serves to fight against social and cultural norms which hinder entrepreneurial activity ”, explains the director. of the Master in Entrepreneurship and Innovation from EAE Business School.

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