Popular, UPR present Global Entrepreneurship Monitor study
A jump in the percentage of startup companies that opened in Puerto Rico in the last two years, as well as a greater acceptance by adults willing to become entrepreneurs, were part of the results of the Global Entrepreneurship Monitor (GEM) international academic study.
The University of Puerto Rico conducted the research, after receiving a $45,000 donation from Popular Inc.’s Entrepreneurs Acceleration Program in 2022, and $15,000 from the Economic Development and Commerce Department (DDEC, in Spanish).
The research sought to provide metrics of the island’s entrepreneurial ecosystem.
The GEM is an international academic study that considers the entrepreneurial activities of the population, as well as dynamics that have economic, social and cultural dimensions. The analysis distinguishes entrepreneurial activity by life cycle phase (nascent, new, established or discontinued), by impact (high growth, innovative and market reach), and by type (early entrepreneurial activity, established, and employee ventures).
“We chose GEM as a tool to understand the situation of the local entrepreneur in comparison with the other countries that are measured,” said Javier Ferrer, chief strategy officer of Popular Inc.
“The GEM results reflect a growing business ecosystem, that is increasingly robust, and a growing interest in entrepreneurship among the adult population,” he said. “In most aspects that were measured, Puerto Rico has improved compared to countries classified as similar according to the average income of their populations.”
The results of this study showed an improved perception among the population regarding increased entrepreneurial opportunities and confidence in their developed skills. Most of those interviewed for the research expressed an intention to start a business within the next three years despite the fear of failure that persists in some individuals and the fact that 28.2% of those who started a business before the COVID-19 pandemic had to close it down due to it.
Another area that stood out were data alluding to the Early Business Activity Index, which increased from 14.9% in 2020 to 20.4% in 2022, indicating “notable growth” in the percentage of new companies or startups for 2023.
“Despite the obstacles, attitudes, perceptions and motivation to go into entrepreneurship have improved in Puerto Rico,” said Theany Calderón, professor at the UPR-Río Piedras’ School of Business Administration.
Among the recommendations presented in the research is to accelerate the integration of entrepreneurship and innovation into K-12 education, vocational education and college education, as well as to identifying a greater diversification of financing sources that can facilitate concept development.
In addition, the experts call for simplifying and optimizing the process to get permits and for the government to become a facilitator, instead of an obstacle, to speed up the establishment of new businesses.
Finally, they recommended integrating government services for entrepreneurs into a “one-stop shop” on an easy-to-use, interactive and agile digital platform.
