Trinidad and Tobago ranked 81 in the 2018 Global Entrepreneurship Index. Puerto Rico was 41, followed by Barbados at 55. Are we doing enough to impact local entrepreneurial aspirations, attitudes and abilities? How can we create an enabling environment for local start-ups?
by Navneet Boodhai, Manager, Engineering Institute, UWI, St. Augustine; Director/Owner, The Bungalow Restaurant & Lounge
Published in CONTACT Magazine
Every country aspires to become the next Denmark or Estonia, Chile, Singapore or South Korea, which are benchmarks in innovation as a key driver for job creation, wealth, stability and sustainability. There’s one major commonality among them: the ability to create unique ecosystems based on their individual cultures, strengths, weaknesses and realities.
The question, therefore, is: What’s our ecosystem? As a country, as institutions and as key enablers, we’ve all got work to do if we are to quickly but successfully build a more modern infrastructure for developing entrepreneurs and generating new business growth.
Puerto Rico’s “enterprising island” model
Recently, as a representative of The University of the West Indies (UWI), I had the opportunity to be part of the Organisation of American States (OAS) sponsored America’s Competitiveness Exchange (ACE) in Puerto Rico. It was a humbling experience to see what a resilient population and a few good policies did to reposition the economy and improve its competitiveness through catalytic investments in its “enterprising island” strategy after Hurricane Maria’s devastation in September 2017.
In less than two years, Puerto Rico developed an entrepreneurial ecosystem with significant investment in over 20 business enablers in major cities across the island. These comprised full service incubators, accelerators, shared-spaces, labs and prototyping facilities. Hundreds of successful business start-ups and social entrepreneurship efforts not only helped normalise the economy post-Maria, but also strengthened its national ecosystem with three key areas of attention, namely:
Building an entrepreneurial movement by bringing together all stakeholders under the one “enterprising island” umbrella. The strategy was developed by a wide cross-section of stakeholders and led by a multi-sectoral expert advisory board.
Building entrepreneurial capacity within its teachers, professors, government officials, its network of entrepreneurial support professionals and multi-sector business leaders.
Aligning a number of initiatives and interventions under a one-stop-shop approach to stimulate innovation and entrepreneurship, starting with the school system and continuing into the university and the community.
Puerto Rico, an island very much like ours, arguably with much fewer resources, built a model which we can emulate.
Trinidad and Tobago’s entrepreneurial environment
Entrepreneurs are sometimes referred to as people who leverage opportunities to create new business. But the reverse also holds true – entrepreneurs are people who leverage business to create new opportunities.
With over 20,000 companies registered and in operation within the formal economy – regardless of their size, location, or industry – this would present 20,000 opportunities for future innovation and growth in T&T, if the support structures, systems, policies and institutional frameworks were better developed.
We have entrepreneurial elements such as a regulatory framework that protects intellectual property, a mature legal system, quality-assured educational institutions, available skills development programmes, and opportunities for networking.
But is this enough? Are we engendering the right entrepreneurial mind-set? Is the population generally willing to take risks? Do we have a supportive culture of innovation that celebrates entrepreneurial success and embraces failure?
Based simply on the data collected on the annual number of patents filed or on export growth from the SME (small and medium-sized) sector, most people would say no. But do we have the innovative ideas, passion and energy? A definite yes.
It is now vital that we make the transition before it’s too late. Puerto Rico’s turnaround took just two years!
The local education system has traditionally placed more emphasis on graduating students in relatively discrete subjects, courses and degrees, than on an integrated multi-disciplinary system of learning and mentorship beyond the teaching process. Research is primarily for academic merit rather than modern application, which in effect favours the details of a problem over the advancement of a solution.
Public institutions that have been given the responsibility for developing our ecosystem are either without direction or starved of resources. And the role of business in all of this discussion is simply not enough. Funding for entrepreneurial activities is largely project-based with a “here today, gone tomorrow” approach. This is generally our reality!
The role of academia
Since the advent of The University of Trinidad and Tobago (UTT) in 2004, with a mission to develop itself as an entrepreneurial university, and more recently The University of the West Indies, St Augustine campus signalling similar intentions, there has been some movement away from the traditional mould.
In 2014, UTT – best known for innovative and practical degree programmes in fashion, music, creative arts and animation among other disciplines – established its uSTART Incubator Programme as the primary hub to support several centres of entrepreneurial excellence, such as a sound recording studio, a fashion production lab (still be to completed), an animation lab and a 3D fabrication and rapid prototyping facility.
All of these were intended to mentor and push students towards the creation of new products and services that are commercial in nature. Over a hundred young entrepreneurs have been supported at various levels since inception, efforts which I was proud to have led.
UWI’s thrust in this direction has only just begun. The St Augustine Centre for Innovation and Entrepreneurship is a hub for developing and managing an internal ecosystem. Entrepreneurship committees have been established in each faculty to disseminate cohesive plans and engender more entrepreneurial effort. The recently formed UWI Ventures is a wholly-owned subsidiary of the university, with the potential of taking equity and investing in a portfolio of start-ups. All these are steps in the right direction.
Both UWI and UTT should now look at the various shared-space entrepreneurship development models and incorporate them at their Debe and Tamana campuses respectively. Other organisations such as COSTAATT, private institutions and the Arthur Lok Jack Global School of Business have all started adding entrepreneurship to their academic offerings, though largely as stand-alone efforts. The latter is soon to restart its Accelerator Programme supporting student entrepreneurs.
These efforts are indeed admirable. But the education system continues to fall short because graduate students at all levels continue to resist risk-taking challenges and the idea of entrepreneurship.
Focus must be placed on the pre-16 education system in order to stimulate mindset and cultural change at an earlier age. Adding case studies of local and regional entrepreneurial successes, failures, and phoenixes in the classroom would be a significant step in developing relevant but aspirational thought.
CARIRI has established its Centre for Enterprise Development (CED), a one-of-a-kind shared space with a lot of resources for start-up growth, but it is largely under-utilised. NIHERST, with plans for a major transformation, is seen as the triple-helix nexus within the entrepreneurial space, but it has to think outside the box to mobilise resources and take greater initiative to cement its place as a lead enabler.
The National Integrated Business Incubator System (IBIS) also has a significant role to play, but needs to be modernised if it is to make any significant impact. The local Intellectual Property Office (IPO) is in the process of establishing an IP Academy, catering to the developmental needs of the judiciary, customs, technocrats, institutions, and academia, among others.
Multilateral assistance and financing
Several financial tools such as angel investing, venture capital, and spin–off investing are slowly being developed. Efforts by Avatar Capital, IP Angels, Renaissance Angels and others are to be encouraged, with more sound policies and incentive programmes to support them and other private sector investments.
The Trinidad and Tobago Chamber of Industry and Commerce (TTCIC) continues to play a supportive role, facilitating capacity building and networking among small and medium-sized businesses through its Business Insights committee, which is primarily made up of experts from professional service firms, entrepreneurs and academia.
Regionally, there have been several projects funded and implemented by the Compete Caribbean Partnership Facility (CCPF), a private sector development programme which was formed to “stimulate economic growth, increase productivity and foster innovation and competitiveness”. CCPF is jointly funded by the Inter-American Development Bank (IDB), the UK Department for International Development (DFID), and the Caribbean Development Bank.
Through the IDB-funded Caribbean Regional Entrepreneurial Asset Commercialisation Hub (REACH), executed by UWI with support from the World Intellectual Property Organisation (WIPO), a number of academic entrepreneurs, innovators and incubator leads benefitted from structured approaches to entrepreneurial development using the Business Model Canvas – a single-page tool used in the process of customer discovery, ideation and formulating a business pitch.
The way forward
Without a doubt, all the key components of a national ecosystem for entrepre-neurship and entrepreneurial development exist. Entrepreneurs, though unstructured and creative in their approaches, thrive in environments where policies offer protection, guidance, opportunity, reward and facilitation, especially in the early start-up stages. But entrepreneurial environments that suit their needs and thereby impact on the policies being set are still largely lacking.
Policymakers need to constantly engage such entrepre-neurial communities and be versatile in their response. Academia has to embrace the changing needs of education, seek to break down the virtual walls created around it, and allow for more multi-disciplinary learning environments.
Entrepreneurial spaces must be created within these environments. Diversity of thought, and equitable and fair access to opportunity, are necessary to empower young people, women, the more vulnerable in society, and conventional businesses, to chase their entrepreneurial ambitions.
Using the “factor of one” principle, and in order to develop a single national ecosystem, there is an immediate need to have all stakeholders – entrepreneurs, institutions, financiers, innovators and enablers – engage in open dialogue towards common understanding and ensuring some semblance of cooperation, celebration and focused networking.
Understanding the Business Model Canvas (BMC)
The business model canvas, created by Alexander Osterwalder of Strategyzer, is a tool used by entrepreneurs, students, financiers, competitions and institutions to help create, disseminate and understand a business model in a simple yet structured manner.
This one-page framework provides just enough insight about the customer through a process of “customer discovery”, identifying not their needs but their pains and gains, moving further to pinpoint how to relieve those pains and achieve new gains, and thereby developing a value proposition that is both unique and customer-focused.
Business model canvases are used to describe, visualise, assess and allow for quick changes to business models. They describe how an entrepreneur creates, delivers and captures value – all on one page.
The nine building blocks of the BMC define:
- Customer segments
- Value propositions
- Customer relationships
- Revenue streams
- Key activities
- Key resources
- Key partnerships
- Cost structure.
Jamaica, the first country in the Caribbean to have developed a comprehensive Micro, Small and Medium Enterprises (MSME) & Entrepreneurship Policy in 2013, has trained key stakeholders across the entrepreneurial ecosystem in developing and using the BMC. It is widely used by incubators, classrooms, venture funds and competitions.
Case study: Puerto Rico’s economic reality
The year of “Despacito”, 2017, was characterised by unprecedented escalation of debt, and businesses, talent and people fleeing the island. Hurricanes exacerbated these challenges: Puerto Rico suffered over US$90 billion in lost economic output, a rapid 20% decline in economic activity, and the permanent closure of some 5,000 small businesses. While its unique geopolitical status as a US territory created opportunity, it also triggered confusion at the political level.
Fast-track to 2019, a mere two years later. While there are still challenges being faced, growth in the island’s mixed economy is being driven by both local small and medium-sized entrepreneurial enterprises, balanced with foreign direct investment in the manufacturing of pharmaceuticals, textiles, and petrochemicals; electronics; aviation; food and beverages. There is growth in services, including ICT, finance, healthcare, real estate development, and tourism.
Private sector backing: the Trinidad and Tobago Chamber of Industry and Commerce (TTCIC)
The purpose of the TTCIC Business Insights Content Committee (BICC) is to create and manage the quality of content being developed for a widening audience of the Chamber.
Content from the BICC seeks to:
- Add value to TTCIC’s membership
- Provide opportunities for the business and entrepreneurial sectors to support the growth and development of industries and entrepreneurs through a suite of courses marketed as the Business Insights (BI) Series
- Close the gap between academia and the business/entrepreneurial world
- Provide real-life, local content for business incubators in Trinidad and Tobago.
Content is conveyed via short courses complementing (and not competing with) the programmes of academic institutions.
Since September 2017, over 20 courses have been delivered in areas such as cryptocurrency, business financing, HR management and labour issues, tax compliance, and marketing. (For more information, email email@example.com)