Entrepreneurship hype under the microscope “There is an atmosphere that attracts”

A lot is being done to stimulate entrepreneurship and innovation. But the vast majority of start-ups fail and the return on innovation declines over time. Yet entrepreneurship is hotter than ever. Why is it so?

The entrepreneur is seen by many as an important force in society. It is someone who creates innovations and job opportunities, solves the green transition and gets the long-term unemployed into work. The culture around the entrepreneur is sympathetic and exciting, and many want to be part of it. This is according to Anna Brattström, researcher at the Sten K Johnson Center for Entrepreneurship at Lund University. She studies the culture of entrepreneurship and what consequences it can have for individuals and society.

– Just like in other subcultures, there is an atmosphere that attracts. I see it in our students, how they see entrepreneurship as a dream and career choice. I think that is different than 15 years ago. On the streaming services, there are a lot of TV series about successful entrepreneurs and entrepreneurial services and products are being marketed and sold like never before. And large sums of public money are being spent on training and advice on entrepreneurship and innovation.

People can develop their ideas and entrepreneurship in both private and public initiatives. Incubators, start-up hubs, innovation labs and accelerators are some examples. But the results of these initiatives are unclear. However, previous research shows that the return on innovation has fallen over the past 30 years,” says Anna Brattström.

Clothes and language give you away

In a recent study, she examined the cultural markers that exist in the entrepreneurial sphere. Some are superficial, such as dress codes and language. Jeans and t-shirts are more common than shirts and suits.

– There is a strong youth ideal linked to the idea that entrepreneurship creates something different. If you Google images of Klarna’s founders, you’ll see that they initially dressed like bank clerks. In the latter images, the dress code is jeans and t-shirt.

Move fast and break things is Facebook’s motto and embodies an entrepreneurial culture of hard work and long days. Elevator pitch, scaling, exit, unicorn, pitch deck, beach head. The Swedish startup world has strong influences from Silicon Valley. English terms are often used instead of Swedish.

– If you know how to chew, you show that you are part of the gang, which is also typical of a subculture.

– The perception is that entrepreneurship overturns the establishment and that it makes life better for people. There is a lot to this! Entrepreneurs have played and continue to play an important role in economic, technological and social development. But what has happened recently is that entrepreneurship has also emerged as a strong cultural ideal.

Public investment risks misleading

According to Anna Brattström, it is important to understand the cultural elements of entrepreneurship to have a complete answer to the question of why entrepreneurship is so hot. “When a culture is trendy with many driven actors, large amounts of private and public funds are invested.

– It is good that society invests large sums in entrepreneurship and innovation, but it is important that the money is spent where it will do the most good. If people start businesses because they are attracted by a culture, rather than for financial reasons, it is conceivable that there will be an increase in the number of unhealthy businesses that are unable to stand on their own two feet and survive over time. If dreams without substance are also supported with tax money, it is problematic because tax money always has an alternative use,” says Anna Brattström.

At the level of the individual, starting a business is risky; far from everyone is able to make a living from it. And of the entrepreneurs who invest in growth companies, very few succeed. Yet becoming an entrepreneur is attractive, according to Brattström, who believes that the strong subculture is one explanation for the phenomenon. And she is self-critical.

– It is important to know on what basis you start a business. If we entrepreneurship researchers encourage our students to start businesses, we should give them the right conditions. Otherwise, they’ll be a bunch of people who have suddenly been working on their business for ten years without any real return.

– Although society benefits from entrepreneurship in terms of employment, the individual takes a huge risk. We rarely hear about it. “We researchers are part of the narrative of entrepreneurship as a path to growth and a solution to societal problems. We need to do something about that,” says Anna Brattström.

Contact anna.brattstrom@fek.lu.se

Upcoming study
In the fall of 2022, Anna Brattström, together with Mickaël Buffart and Karl Wennberg at the Stockholm School of Economics, will start a major research project that will study entrepreneurship as an industry buoyed by strong cultural ideals. Understanding the subculture at a deeper level will be part of understanding why people want to become entrepreneurs and why organizations invest in entrepreneurial activities. The first results of the project can be read here:
An exploratory case study on cultural ideals in the entrepreneurship industry (2022)
A critical analysis of storytelling in entrepreneurship research (2022)