At an event held in the Stanford University in June, President Barack Obama took the stage with Facebook CEO Mark Zuckerberg. He interviewed fledgling entrepreneurs from Egypt, Rwanda, and Peru and caught the audience off guard by removing his jacket and joking about his inability to “wear a T-shirt like Mark for at least another six months”.
It is rare to go to a government event, especially where political leaders are speaking, in which you can stay awake or be inspired. This was a refreshing change. I was impressed with the dynamism and energy the event generated.
This was the seventh annual Global Entrepreneurship Summit (GES). The first, which was held at the White House in 2010, was announced by Obama in Cairo in 2009 to “deepen ties between business leaders, foundations and social entrepreneurs in the United States and Muslim communities around the world”. Its scope has since been expanded to include entrepreneurs from all communities.
Government efforts to promote entrepreneurship usually fail because they focus on building science parks and clusters. Policy makers often believe fancy buildings, subsidies and venture capital can spur innovation hubs. This is the wrong approach; what needs to be done instead is to remove the obstacles to entrepreneurship and change the culture so that failure is accepted and experimentation is encouraged. And then entrepreneurs need to provided with mentoring, inspiration, and seed funding. This is exactly what the GES is doing — by design or by accident.
At the Stanford event, Obama talked about the importance of building networks, changing cultures, and having governments remove road-blocks. He even lectured entrepreneurs on how to pitch their startups to investors.
In his conversation with Zuckerberg and entrepreneurs from Egypt, Rwanda, and Peru. he asked each of them about their journeys, their challenges, their needs, and their advice for others like themselves. He treated the three budding entrepreneurs with the same respect he showed to an icon like Zuckerberg. In the US, we have the American Dream; we often put entrepreneurs on a pedestal. To the rest of the world, this is unimaginable — almost a culture shock.
UAE-based investor Prashant Gulati told me about how rapidly policies changed after the 2012 GES held in Dubai. There were many legal obstacles to e-commerce and Internet startups which were not getting resolved. Things have come far. One startup, souq.com , has even achieved the status of a unicorn, with a billion-dollar valuation.
The 2013 summit in Kuala Lumpur led to the creation of the Malaysian Global Innovation and Creativity Centre. Deregulation and support schemes that ensued have so far taught 15,000 entrepreneurs and incubated 150 companies.
Prime Minister Narendra Modi’s Startup India initiative can be seen as a key milestone in the quest to remove obstacles and provide education, funding and infrastructure to aid startups. During his recent trip to the US, Modi persuaded Obama to hold the next GES in India next year.
The GES will be a huge opportunity for the Indian government to examine how to make regulations more conducive to innovation and new businesses, but also to bring some of the world’s brightest to see the dynamism of India’s economy and its entrepreneurs.
Vivek Wadhwa is a Fellow at the Arthur & Toni Rembe Rock Center for Corporate Governance, Stanford University. The views expressed are personal.