INSIGHT - Toward an Entrepreneurial Ecosystem Research Program

This post is based on research published in our paper “Toward an Entrepreneurial Ecosystem Research Program” (Wurth et al., 2022).

Introduction: Beyond the Buzzword

Over the past decade, the concept of “entrepreneurial ecosystems” has exploded in popularity among researchers, policymakers, and practitioners. From Silicon Valley to Singapore, the idea of creating supportive regional environments for innovative entrepreneurs has captured imaginations worldwide. But in many ways, the entrepreneurial ecosystem concept represents a paradox: it’s simultaneously one of the most influential frameworks in contemporary entrepreneurship policy while remaining theoretically underdeveloped and empirically fragmented.

My colleagues Erik Stam, Ben Spigel, and I recognized this tension. While the concept draws on rich intellectual traditions and offers real potential to unite disparate research streams, it often lacks precise theoretical grounding and empirical validation. In our paper “Toward an Entrepreneurial Ecosystem Research Program,” published in Entrepreneurship Theory and Practice, we decided to take stock of the growing entrepreneurial ecosystem literature to identify what we actually know about how these systems work, and where more research is needed.

The Promise and Paradox of Entrepreneurial Ecosystems

What makes the entrepreneurial ecosystem concept distinctive from earlier approaches to regional economic development? We identified two key advances:

A focus on productive entrepreneurship: Unlike earlier work on regional innovation systems or clusters that focused on all forms of business activity, the ecosystem approach specifically targets entrepreneurship that contributes to net economic output—typically high-growth ventures, innovative startups, and entrepreneurial employees that drive productivity gains.
Emphasis on entrepreneurial agency: Ecosystem approaches foreground the role of entrepreneurs themselves as organizational and community leaders who can shape their environments, not just passive recipients of structural conditions.

These advances represent a significant shift in how we understand regional economic development. Rather than viewing entrepreneurship as something that happens within broader economic structures, the ecosystem perspective puts entrepreneurs at the center, exploring how their agency interacts with and transforms social and economic structures.

But despite these promising theoretical foundations, ecosystem research faces several challenges. Through our systematic review of the literature, we found that studies often use the ecosystem concept merely metaphorically without engaging with its core principles of interdependence. Many studies focus on isolated elements rather than examining the system as a whole. And there’s considerable confusion about what constitutes an ecosystem, where its boundaries lie, and how to measure its performance.

What We Know: Causal Mechanisms in Entrepreneurial Ecosystems

One of our key contributions is synthesizing the empirical evidence on the causal mechanisms that drive entrepreneurial ecosystems. Based on our review of the literature, we identified five key causal mechanisms.

Entrepreneurial ecosystem mechanisms (Wurth et al., 2022).

1. Interdependence of Elements

Perhaps the most fundamental characteristic of ecosystems is the interdependence between different elements. Our review shows that research consistently finds that ecosystem elements are uniquely related in each ecosystem, with feedback and (non-linear) co-evolutionary dynamics between elements themselves and with the wider socio-economic context. This isn’t just theoretical—it has practical implications. Many innovation and entrepreneurship policies fail precisely because they invest in isolated elements (like physical infrastructure) without supporting the underlying cultural and social attributes needed for success.

Individual actors play crucial roles in fostering this connectivity. Universities, for example, often adapt to the state of the ecosystem and contribute in multiple ways beyond their traditional teaching and research roles. Anchor organizations (like established firms or research institutions) frequently initiate and support the initial growth of ecosystems. These interactions aren’t static—governance typically changes from hierarchical to relational as the ecosystem evolves, and the roles of different actors and support organizations evolve alongside the ecosystem itself.

2. Links to Entrepreneurial Outputs

Different ecosystem configurations produce different types of entrepreneurial activity. Even within a single ecosystem, there can be various subclusters based on organizational and individual-level factors. Research has identified distinct institutional settings that enable different types of entrepreneurship, from high-tech ventures to more traditional businesses.

Intriguingly, women and men appear to benefit in different ways from ecosystems and their elements. Globally, women often benefit more from many ecosystem factors than men, though this varies depending on the phase of economic development. Women tend to mobilize more resources than men to overcome support constraints, while men generally report higher confidence in their capabilities.

Most studies find that ecosystems provide the foundation for high-tech entrepreneurship, with cultural and social norms, government programs, and internal market dynamics being particularly important for enabling high-growth startups. The overall quality of an ecosystem is positively related to entrepreneurial output, and ventures in high-performance ecosystems tend to perform better and have higher survival chances.

3. Links to Economic Outcomes

Beyond producing entrepreneurial activity, ecosystems ultimately aim to drive broader economic and social outcomes. Several studies have shown that ecosystem quality at the country level is linked to economic growth. Mature ecosystems enable knowledge spillovers, which increase efficient resource allocation and contribute to national productivity by promoting both Kirznerian and Schumpeterian forms of entrepreneurship.

There appears to be a positive impact from the interaction between companies, universities, and government on entrepreneurial development, with this effect being greater for more developed regions and ecosystems. Importantly, ecosystems seem to moderate the relationship between entrepreneurship and regional economic growth—the same entrepreneurial activity can produce very different economic outcomes depending on the quality of the surrounding ecosystem.

4. Path Dependency and Downward Causation

Entrepreneurial ecosystems aren’t just influenced by their elements—they’re also shaped by their own history and past performance. Individual ecosystems are unique due to their historical, cultural, and institutional heritage. There’s strong path dependence in the evolution of entrepreneurial ecosystems, as entrepreneurial output feeds back into the regional ecosystem.

The broader economic development of a country shapes its ecosystems, and high-growth firms appear to have a greater impact on the entrepreneurial ecosystem than new ventures in general. The state of the ecosystem also influences whether entrepreneurs choose to come to or stay in a region to start a new tech venture.

In less mature ecosystems, for instance, only more mature startups tend to apply for angel investment, whereas in more developed ecosystems, earlier-stage ventures also seek this funding. Policy interventions need to account for the current state of the ecosystem, as they can have different effects on involved clusters and industries depending on the ecosystem’s development stage.

5. Links Between Ecosystems

Finally, ecosystems don’t exist in isolation—they’re connected to other ecosystems through various channels. Research shows that ecosystems are part of wider transnational social fields shaped by the circulation of actors, ideologies, texts, and objects. Emigration, return migration, and outmigration all influence the emergence and evolution of ecosystems.

Contrary to how they’re often portrayed, entrepreneurial ecosystems aren’t static, bounded entities mapped neatly onto a city or nation—they’re dynamic, changing, and densely connected with other systems across both near and distant spaces. There’s bi-directional learning between migrant entrepreneurs and ecosystems, as entrepreneurs bring knowledge and practices from one ecosystem to another.

The Way Forward: A Transdisciplinary Research Program

Based on our synthesis of the literature, we propose a comprehensive research program to advance our understanding of entrepreneurial ecosystems. This program consists of four main research streams and four cross-cutting themes.

Entrepreneurial ecosystem research program with four research streams (horizontal) and four cross-sectional themes (vertical) (Wurth et al., 2022).

Research Streams

Context: Examining how ecosystems are embedded in broader social, economic, and political contexts, and how these contexts shape ecosystem development and performance.
Structure: Exploring the networks and connections that enable resources, knowledge, and support to flow within ecosystems.
Microfoundations: Investigating the processes at the micro-level that drive ecosystem development, including how individual entrepreneurs and organizations interact and co-evolve.
Complex Systems: Applying complex systems approaches to better understand the non-linear dynamics, emergence, and resilience of entrepreneurial ecosystems.

Cross-Cutting Themes

Methodologies and Measurements: Developing new ways to study and measure entrepreneurial ecosystems beyond the current reliance on case studies and cross-sectional analyses.
Theory: Strengthening the theoretical foundations of ecosystem research by integrating insights from institutional theory, evolutionary approaches, social capital theory, and complex systems thinking.
Critical Research: Questioning the implicit assumptions and potential negative consequences of entrepreneurial ecosystem policies, including issues of inclusion, equality, and sustainability.
Transdisciplinary Research: Moving from research on ecosystems to research for ecosystems, integrating academic knowledge with practical insights to develop more effective interventions.

Implications for Research, Policy, and Practice

Our review and proposed research program have significant implications for different stakeholders in the entrepreneurial ecosystem field:

For Researchers

Our work highlights the need to move beyond the metaphorical use of the ecosystem concept toward more rigorous theoretical and empirical approaches. This means:

Developing more sophisticated methodologies that can capture the complex, dynamic nature of ecosystems, including longitudinal studies, mixed methods, and simulation approaches
Focusing on the interconnections between ecosystem elements rather than studying elements in isolation
Considering the multicscalar nature of ecosystems, from local to global
Integrating insights from diverse theoretical traditions, from institutional theory to complex systems thinking

For Policymakers

Our findings suggest that effective ecosystem policies need to:

Address the interdependence of ecosystem elements rather than focusing on isolated interventions
Recognize that different ecosystem configurations may be needed for different types of entrepreneurship
Acknowledge path dependencies and consider how the current state of the ecosystem affects the potential impact of interventions
Be sensitive to local contexts and avoid simply copying features from successful regions
Consider the potential negative consequences of ecosystem development, including issues of inclusion and equality

For Practitioners

Entrepreneurs and other ecosystem actors can benefit from our work by:

Understanding how their activities contribute to the broader ecosystem
Recognizing the importance of connections and relationships in accessing resources and support
Appreciating how the quality of the surrounding ecosystem affects venture performance and growth potential
Considering how they can participate in shaping their ecosystem through both individual and collective actions

Conclusion: From Buzzword to Research Program

The entrepreneurial ecosystem concept has come a long way from its origins in practitioner-oriented publications like Brad Feld’s “Startup Communities” and Daniel Isenberg’s Harvard Business Review articles. It now represents one of the most influential frameworks in entrepreneurship research and policy.

Yet to fulfill its potential, the concept needs to move beyond its current state as a popular but undertheorized buzzword. By synthesizing the empirical evidence on how ecosystems work and proposing a comprehensive research program, we hope to contribute to this transition. The entrepreneurial ecosystem approach offers a promising way to integrate insights from various research traditions and to bridge the gap between structure and agency in understanding entrepreneurial activity.

As the field continues to evolve, we need to maintain a critical perspective, questioning both theoretical assumptions and policy implications. But with a more rigorous and nuanced understanding of how entrepreneurial ecosystems function, we can develop more effective approaches to supporting the kinds of entrepreneurship that contribute to economic development and societal well-being.

After all, entrepreneurship doesn’t happen in a vacuum—it emerges from and contributes to complex social, economic, and institutional environments. By better understanding these environments, we can better understand and support entrepreneurship itself.

Entrepreneurial ecosystems have become a prominent concept, yet in its current state, the concept itself represents a paradox. While it draws on a rich intellectual history and provides an opportunity to synthesize different strands of research, it is also under-theorized and the mechanisms that govern ecosystem evolution are not well understood. This paper takes stock of recent advancements in ecosystem scholarship and synthesizes the empirical reality of the causal mechanisms. We use these dynamics to position ecosystems in a broader context, within and beyond the domain of entrepreneurship research, and propose a transdisciplinary research program for ecosystem research and practice.