Semi-Peripheral Pathways to High-Technology Markets: How Organizational Origins Shape Entrepreneurial Ecosystems

Abstract

Recent technological changes have created new opportunities for small- and medium-sized firms in the semi-periphery to enter digital markets. At the same time, the need to connect startups with the diverse range of actors and resources which sustain an entrepreneurial ecosystem poses a formidable challenge to regions which have historically suffered from disarticulation. The literature suggests that regions aspiring to support technology startups could benefit from bridging organizations or “entrepreneurial ecosystem incubators” (EEIs) to build civic capital. Comparing two successful EEIs in Toronto and Waterloo, Canada, we find that their organizational structure, specifically the composition of their board, shaped connectivity in important ways. Whereas Communitech, an entrepreneur-led EEI in Waterloo, relied heavily on horizontal, peer-to-peer mentoring among entrepreneurs, MaRS, led by established firms and civic leaders, linked startups to external capital, customers, and other resources within a limited number of industry verticals. Both EEIs supported local startup activity, but they fostered different patterns of collaboration and high-technology competition. This analysis suggests that regional leaders in laggard regions may face a tradeoff in how they support technology startups and nurture entrepreneurial ecosystems.