As the only UKI-based partner of the European Scale-up Institute, the Centre for Entrepreneurial Growth & Scaling (CEGS) is tackling Europe’s business scale-up gap through evidence-backed research, outreach, and coaching services.
What are the defining factors of a successful scale-up today, and how can we move the needle in accelerating scaling across Ireland and Europe? CEGS Co-Directors, Professors Esther Tippmann and Jonathan Levie share their thoughts in this new edition of Cois Coiribe.
Start-up rates have been increasing faster recently in Europe than in the US and Asia. (1) However, Europe remains far behind in the scale-up race. For example, Europe has only 15% of the world’s unicorns, privately owned businesses valued at more than one billion dollars, compared to 54% located in the US and 24% in Asia. (2)
Policy and programme makers at national and European levels have recognised this scaling gap. As engines for job creation, scaling businesses are integral to economic prosperity. It is estimated that up to one million new jobs could be created and up to €2,000 billion added to the gross domestic product of the European Union over the next 20 years, if the proportion of scale-ups were to match that of the United States. (3) In Ireland, we have seen a push to increase the proportion of start-ups achieving scale and leadership in global markets, with Enterprise Ireland aiming toward a 10% increase in the number of companies achieving sales of €10m, €20m and €50m.
To tackle this scaling gap, European and national agencies continue to expand their supports from start-up to scaling businesses. With the emphasis placed on start-ups for decades, this has not been an easy transition for Europe. Start-ups require support to experiment and identify a valid business model. In contrast, scaling businesses have identified a valid business model and pursue exponential growth to capture an opportunity, by delivering their offering to a rapidly increasing number of users or customers. Start-up supports work for early-stage entrepreneurship. However, scaling businesses need fit-for-purpose supports focused on their challenges. This requires capacity building within local agencies that work with these businesses on the ground. Add to this a fast-developing climate crisis, and scaling organisations must now match their acceleration with environmental and social impact.
The Centre for Entrepreneurial Growth and Scaling (CEGS) at University of Galway
The Centre for Entrepreneurial Growth and Scaling (CEGS) tackles the challenge of supporting scaling businesses. As a centre of research and outreach, CEGS has been at the forefront of scaling research, and translates these insights into practice through outreach programmes to accelerate the scaling process. In 2022, we were invited by the Enterprise Europe Network to deliver trainings to their scale-up advisors based on the research track record and international reputation of the Centre.
One of the largest of its kind in the world, Enterprise Europe Network brings together advisors from more than 60 countries worldwide, joining from member organisations such as chambers of commerce, innovation support organisations and regional development organisations. Scale-up advisors of the Enterprise Europe Network offer advice to scaling businesses and businesses with scaling potential on a daily basis.
We coached the scale-up advisors on exercises that they can use with their client companies. These evidence-based exercises are developed based on research insights from CEGS and tested with scaling businesses. 120 scaleup advisors from across Europe were trained online in 2022, and 43 scaleup advisors in person in 2023, at the Brussels headquarters for the European Innovation Council and SMEs Executive Agency (EISMEA). The exercises help these businesses to diagnose potential scaling issues before they become roadblocks. They also help scale-up advisors in agencies to identify businesses that are ready to scale to prioritise their supports. The exercises covered strategic planning, checks for business model readiness, product-market fit and scalability readiness, as well as practices for managing global scaling. The advisors have brought back their learnings to their colleagues and clients across Europe.
We followed up with these advisors one year later to see how they were getting on. While some found the exercises succeeded in getting their clients to stop and think about what they wanted to do with their business, or whether they were ready for the next stage of its development, others found the coaching approach the most valuable, relieving them of the presumption that they need to find the solutions to their clients’ problems, rather than helping the clients to find the right solution for themselves.
With scaling businesses having such an impact on the future of the national and European economy as well as the transition towards a more sustainable world, we are proud that CEGS is playing its part in boosting capacity in the supports available for scaling businesses now and in the future.
Profiles
Professor Esther Tippmann is a Co-Founder and Co-Director of the Centre for Entrepreneurial Growth and Scaling (CEGS) at the J.E. Cairnes School of Business and Economics, and Professor of Strategy at the University of Galway. She has worked closely on case studies with several scaling firms and multinationals in Ireland, France, the UK and the US. Prof Tippmann has published in various journals including the Journal of International Business Studies, Strategic Management Journal, Havard Business Review and Sloan Management Review. She currently serves as Head of Discipline, Management and Area Editor at the Journal of International Business Studies, the world-elite journal in the field of international business.
Professor Jonathan Levie is Professor of Entrepreneurship and Regional Development in the J.E. Cairnes School of Business & Economics in the University of Galway and a Co-Founder and Co-Director of the Centre for Entrepreneurial Growth & Scaling. He has been researching and teaching entrepreneurship for over 40 years, including 20 years at the Hunter Centre for Entrepreneurship in the University of Strathclyde. His current research interests are in business scaling and entrepreneurial ecosystems. He has published in leading entrepreneurship and management journals including Journal of Business Venturing, Entrepreneurship Theory & Practice, Research Policy, Journal of Management Studies, Academy of Management Discoveries and Small Business Economics.
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