Entrepreneurship, clusters & industrial park

The context of this study is the southwest of Finland and the attempts to create a regional innovation system enabling an increased rate of venture development and emergence of high growth high technology firms based on a triple helix model. The area has a science park, which was established 2002, three universities and four polytechnic colleges and a strong concentration of industry in particular in the pharmaceutical and ICT sectors. There is also a strong shipbuilding industry, which produces most of the world’s luxury cruise lines. Hence this area seems like a typical example of a regional agglomeration that should show strong entrepreneurial vitality.
However, there is a consensus among governmental officials, local business leaders, and academics that not enough firms are founded in the region and that there are far too few growth companies. This is a problem that seems to plague Finland as a whole. Moreover, there is an understanding that a much larger number of ideas and innovations that potentially could generate firms should emerge from the concentration of research universities and technology institutions. Somehow, despite numerous governmental agencies providing counseling and financial support for persons willing to start companies, these persons do not appear nor do the universities appear to produce ideas and innovations at a desirable rate.
On a national level numerous initiatives and instruments to boost technology development and innovations has taken place since 1983 when the National Technology Agency (TEKES) was founded with primary objective to promote the competitiveness of Finnish industry and the service sector through technological means. In 1987 The Science and Technology Policy Council (STPC) was established. During the 1990s major reforms were conducted: (i) a regional innovation policy was established through an act enforced at the beginning of 1994 leading to the creation of regional centers of expertise, (ii) a cluster programme was launched in 1997 to reinforce the utilization and commercialization of technology by established technology centers and incubators and licensing offices in the universities. 8 cluster programmes were formed under six ministries and one national cluster, The Finnish Pharma Cluster was formed, and (iii) venture capital activity started with Sitra as a pioneer. Apparently, some of these measures have paid off as Finland was for the fourth consecutive year regarded as the most competitive nation (Global Competitiveness Report, 2005). Yet, entrepreneurial activity in Finland is remarkably low. Technology-based new venture creation is low and has dropped in Finland since 2000 (Table 1) despite policy measures aiming for an opposite trend. In 2003 it looked as if measures would pay off, but results from 2004 follow a downward trend since 2000. Opportunistic entrepreneurship does not keep pace with the level of technology development. It decreased from 600 new ventures in 1995 to only 350 in 2002 (Reynolds 2005).