Enabling entrepreneurial ecosystems to create, develop and sustain high growth enterprises

Abstract

The South African government has emphasised the important role that entrepreneurship is expected to play in growing and sustaining the economy and have committed resources to develop, grow and support entrepreneurial activity in small businesses. However, the focus on small businesses to sustain economic growth does not align with the findings in entrepreneurial and economic academic studies, this is an indication of the disparity between academics and practitioner perspectives. This study presents an opportunity to bridge the divide between academic and practitioner perspectives, by formulating a theoretical conceptual framework on enabling entrepreneurial ecosystems to support high growth entrepreneurship, which has the highest probability of boosting economic growth. The potential of enabling entrepreneurial environments, that foster social networks and support structures, in creating, developing and sustaining high growth firms has gained considerable attention by both academics and practitioners. This research will study; using ecology concepts, models and theories that have been successfully applied to social sciences studies; the characteristics and interrelationships of the dynamic interactions between the different elements and processes in an entrepreneurial ecosystem that contain high growth enterprises in South Africa. This exploratory and qualitative study, by way of semi-structured interviews and archival data, involved 14 interviews which were conducted in Gauteng and the Western Province over a three-month period. The results of this study indicated that entrepreneurial actors are driven by a need and an enabling culture, the alignment of which will result in the accumulation of valuable resources required to create, develop and sustain high growth enterprises in an ecosystem. The study revealed the difficulties experienced by entrepreneurial actors who were not aligned to the ecosystem culture in receiving the demanded resources, causing many actors to eventually leave the ecosystem. Additionally, the study indicated that strengthening of entrepreneurial ecosystems through high levels of cohesion and interconnectedness, may worsen income inequality and unemployment for those individuals located in the region but not participating in the entrepreneurial ecosystem. The findings of this study have led to the creation of a new model, that is meant to benefit all actors in the entrepreneurial ecosystem by providing a set of guidelines that will assist in creating, developing and sustaining high growth enterprises in South Africa.