HBR.ORG SeptemBeR 2012 reprinT F1209Z

Vision statement

Can Start-Ups Help Turn the Tide?

0

–50

2006 2007 2008 2009 2010 2011

+50

+100

+150%

France

France

CanadaU.S.

Italy

Spain

Portugal

Manufacturing Services

0 21YEARS OF SURVIVAL YEARS OF SURVIVAL

0 1 2

Spain

Australia UK

U.S.Germany

Spain

AustraliaUK

U.S.

Germany

India

Indonesia

China

Czech Republic

Greece

Austria

Spain

Poland

Brazil

China 14

Brazil 13

India 12

Greece 10

Spain 10

Czech Rep. 9

Germany 9

Russian Fed. 9

Austria 8

Brazil 119

Indonesia 45

China 38

Israel 34

Poland 32

Russian Fed. 30

India 29

Austria 28

Spain 28Gr

eece Sp

ain

Irela

nd

UK

Fran

ce

Germ

any

U.S. Au

stra

lia

Swed

en

75%

60

45

30

15

0

20

40

60

80

100%

0Japa

nIre

land

UKSwed

en

Aust

ralia

Germ

any

Mex

ico

Gree

ceSp

ain

Unite

d St

ates

( 201

0)

Chin

aPo

land

Braz

il

Fran

ceIta

ly (2

010)

Portugal22.2%

Brazil11.1

U.S.10.4

New Zealand10.5

Canada9.3 Luxembourg

7.3

40

60

80

100%

–60

0

+240%

+180

+120

+60

2006 2007 2008 2009 2010 2011

Italy

Port

ugal

Czec

h Re

publ

ic

Unite

d St

ates

Braz

il

Fran

ce

Isra

el

MAN

UFAC

TURI

NG

SERV

ICES

0

2

4

6

8

10%

Port

ugal

Spai

n

Italy

Hun

gary

Swed

en

Aust

ria

Czec

h Re

publ

ic

MAN

UFAC

TURI

NG

SERV

ICES 2

1

0

3

4

5

6%

Austria9.2

Brazil

Luxembourg

U.S.Italy

IsraelPortugal

SERVICES

UK

U.S.

Italy

11%

1–9

7%

16%

13%53%

20

79

1649%

46

1210

12

19%

39

1012

15

24%

SpainMAN

UFAC

TURI

NG

0.0% 1.0 2.0 3.0

1.0

2.0

NUMBER OFEMPLOYEES

20–49

50–249

10–19

250+

Brazil

17

10

11

21

41%

Germany

25

12

11

15

37%24

9

1216

40%France

Newly simpli-fied regulations in France have paid off.

In the U.S., 31% see opportunities but are afraid of failing.

Brazilians have the most positive view of entre-preneurship as a career.

Births

Growthattitudes*

survival

NumBeR Of New fiRmSPerceNt chaNge From Start oF 2006

iS eNtRepReNeuRSHip SeeN aS a GOOd OptiON iN yOuR cOuNtRy?

PeoPLe age 18 to 64 who SaId yeS (2011)

HiGH-GROwtH fiRmSShare oF comPaNIeS wIth 10+ emPLoyeeS that SUStaIN raPId growth (2009)

HOw maNy BiRtHdayS?LoNgevIty oF comPaNIeS Started IN 2005

JOBS cReated By BiRtHSShare oF aLL joBS that are IN New FIrmS (2008)

PeoPLe age 18 to 24 who:BeLIeve they have the NeceSSary SKILLSSee good oPPortUNItIeSSee oPPortUNItIeS BUt Fear FaILUre

wOuld yOu StaRt a BuSiNeSS? (2011)

Vision Statement

with unemployment stuck at stubbornly high levels around the globe, optimists hope that the hard times will provide a spark for innovation, as they often have in the past: IBm, disney, microsoft, and apple were all launched during a recession.

Increasing the number of start-ups will be key to a global labor recovery. that’s why policy makers are paying close attention to the special alchemy needed to create an entrepreneur-friendly economy. the ingredients include a skilled population with an appetite for risk and the ability to spot oppor-tunities, and a minimum of red tape and other procedural hurdles.

the charts at right show how the organisation for economic co-operation and development ranks countries on a variety of issues related to entrepre-neurial success. HBR Reprint F1209Z

Can start-Ups Help turn the tide?as the global economy continues to sputter, new businesses—and the jobs they create—are more important than ever. here’s a look at the factors in various countries that affect the entrepreneurial climate.

SOuRce “eNtrePreNeUrShIP at a gLaNce, 2012,” oecd (FIrmS INcLUded have at LeaSt oNe emPLoyee)

* BaSed oN a SUrvey By gLoBaL eNtrePreNeUrShIP moNItor

** From “doINg BUSINeSS,” worLd BaNK, 2012

2  harvard Business review september 2012

idea watCH

coPyrIght © 2012 harvard BUSINeSS SchooL PUBLIShINg corPoratIoN. aLL rIghtS reServed.

0

–50

2006 2007 2008 2009 2010 2011

+50

+100

+150%

France

France

CanadaU.S.

Italy

Spain

Portugal

Manufacturing Services

0 21YEARS OF SURVIVAL YEARS OF SURVIVAL

0 1 2

Spain

Australia UK

U.S.Germany

Spain

AustraliaUK

U.S.

Germany

India

Indonesia

China

Czech Republic

Greece

Austria

Spain

Poland

Brazil

China 14

Brazil 13

India 12

Greece 10

Spain 10

Czech Rep. 9

Germany 9

Russian Fed. 9

Austria 8

Brazil 119

Indonesia 45

China 38

Israel 34

Poland 32

Russian Fed. 30

India 29

Austria 28

Spain 28

Gree

ce Spai

n

Irela

nd

UK

Fran

ce

Germ

any

U.S. Au

stra

lia

Swed

en

75%

60

45

30

15

0

20

40

60

80

100%

0Japa

nIre

land

UKSwed

en

Aust

ralia

Germ

any

Mex

ico

Gree

ceSp

ain

Unite

d St

ates

( 201

0)

Chin

aPo

land

Braz

il

Fran

ceIta

ly (2

010)

Portugal22.2%

Brazil11.1

U.S.10.4

New Zealand10.5

Canada9.3 Luxembourg

7.3

40

60

80

100%

–60

0

+240%

+180

+120

+60

2006 2007 2008 2009 2010 2011

Italy

Port

ugal

Czec

h Re

publ

ic

Unite

d St

ates

Braz

il

Fran

ce

Isra

el

MAN

UFAC

TURI

NG

SERV

ICES

0

2

4

6

8

10%

Port

ugal

Spai

n

Italy

Hun

gary

Swed

en

Aust

ria

Czec

h Re

publ

ic

MAN

UFAC

TURI

NG

SERV

ICES 2

1

0

3

4

5

6%

Austria9.2

Brazil

Luxembourg

U.S.Italy

IsraelPortugal

SERVICES

UK

U.S.

Italy

11%

1–9

7%

16%

13%53%

20

79

1649%

46

1210

12

19%

39

1012

15

24%

SpainMAN

UFAC

TURI

NG

0.0% 1.0 2.0 3.0

1.0

2.0

NUMBER OFEMPLOYEES

20–49

50–24910–19

250+

Brazil

17

10

11

21

41%

Germany

25

12

11

15

37%24

9

1216

40%France

0

–50

2006 2007 2008 2009 2010 2011

+50

+100

+150%

France

France

CanadaU.S.

Italy

Spain

Portugal

Manufacturing Services

0 21YEARS OF SURVIVAL YEARS OF SURVIVAL

0 1 2

Spain

Australia UK

U.S.Germany

Spain

AustraliaUK

U.S.

Germany

India

Indonesia

China

Czech Republic

Greece

Austria

Spain

Poland

Brazil

China 14

Brazil 13

India 12

Greece 10

Spain 10

Czech Rep. 9

Germany 9

Russian Fed. 9

Austria 8

Brazil 119

Indonesia 45

China 38

Israel 34

Poland 32

Russian Fed. 30

India 29

Austria 28

Spain 28

Gree

ce Spai

n

Irela

nd

UK

Fran

ce

Germ

any

U.S. Au

stra

lia

Swed

en

75%

60

45

30

15

0

20

40

60

80

100%

0Japa

nIre

land

UKSwed

en

Aust

ralia

Germ

any

Mex

ico

Gree

ceSp

ain

Unite

d St

ates

( 201

0)

Chin

aPo

land

Braz

il

Fran

ceIta

ly (2

010)

Portugal22.2%

Brazil11.1

U.S.10.4

New Zealand10.5

Canada9.3 Luxembourg

7.3

40

60

80

100%

–60

0

+240%

+180

+120

+60

2006 2007 2008 2009 2010 2011

Italy

Port

ugal

Czec

h Re

publ

ic

Unite

d St

ates

Braz

il

Fran

ce

Isra

el

MAN

UFAC

TURI

NG

SERV

ICES

0

2

4

6

8

10%

Port

ugal

Spai

n

Italy

Hun

gary

Swed

en

Aust

ria

Czec

h Re

publ

ic

MAN

UFAC

TURI

NG

SERV

ICES 2

1

0

3

4

5

6%

Austria9.2

Brazil

Luxembourg

U.S.Italy

IsraelPortugal

SERVICES

UK

U.S.

Italy

11%

1–9

7%

16%

13%53%

20

79

1649%

46

1210

12

19%

39

1012

15

24%

SpainMAN

UFAC

TURI

NG

0.0% 1.0 2.0 3.0

1.0

2.0

NUMBER OFEMPLOYEES

20–49

50–24910–19

250+

Brazil

17

10

11

21

41%

Germany

25

12

11

15

37%24

9

1216

40%France

very small firms— 1 to 4 employees—failed at higher rates. (manufacturing fared better than services.)

high-growth firms add 20% or more employees annually for 3 years.

a majority of U.S. employees work in large firms.

In some countries bankrupt firms must cease operations immediately. In others they may continue and even recover.

the average 1-year survival rate is about 85% in manufacturing, a little lower in services.

In the U.S., it takes 6 procedures and 6 days to start a firm.

Services start-ups far outpace manufacturing ones in job creation.

Italy has the lowest share of employees of large firms.

Brazil has the highest share of gazelles in both manufacturing and services.

gazelles are no more than 5 years old.

employmentHuRdleS tO StaRtiNG a BuSiNeSS (2011)**

wHO wORkS wHeRe?Share oF emPLoyeeS By FIrm SIZe (2008)

BaNkRuptcieS PerceNt chaNge From Start oF 2006

deatHSBUSINeSS FaILUreS, From BaNKrUPtcIeS aNd other caUSeS (2008)

GaZelleS: yOuNG HiGH-GROwtH fiRmSShare oF comPaNIeS wIth 10+ emPLoyeeS that are gaZeLLeS (2009)

the 9 moSt reStrIctIvecoUNtrIeS

ProcedUreS reqUIred to LegaLLy LaUNch

medIaN dayS Needed

september 2012 harvard Business review 3

For artIcLe rePrINtS caLL 800-988-0886 or 617-783-7500, or vISIt HBR.oRG