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The dot.com crash deflated this tsunami - but only temporarily. US venture capitalists still invest four times average of their brethren elsewhere - c. 0.5 percent of GDP. This translates to an average investment per start up ten times larger than average investment outside America.
American investors also power VC industry in UK, Israel, and Japan. A Deloitte Touche survey conducted last month (and reported in Financial Times) shows that a whopping 89 percent of all venture capitalists predict an increase in value of their investments and in their exit valuations in next 6 months.
Entrepreneurs in USA still face many obstacles - from insufficient infrastructure to severe shortages in skilled manpower. The July 2001 report of National Commission on Entrepreneurship (NCOE) said that less than 5 percent of American firms that existed in 1991 grew their employment by 15 percent annually since, or doubled their employment in feverish markets of 1992-7. But report found high growth companies virtually everywhere - and most of them were not "hi-tech" either. Start-ups capitalized on economic strengths of each of 394 regions of USA.
As opposed to stodgy countries of EU, many post-communist countries in transition (e.g., Russia, Estonia) have chosen to emulate American model of job creation and economic growth through formation of new businesses. International financial institutions - such as EBRD and World Bank - provided credit lines dedicated to small and medium enterprises in these countries. As opposed to USA, entrepreneurship has spread among all segments of population in Central and Eastern Europe.
In a paper, prepared for USAID by IRIS Centre in University of Maryland, authors note surprising participation of women - they own more than 40% of all businesses established between 1990-7 in Hungary and 38% of all businesses in Poland.
Virtually all governments, east and west, support their "small business" or "small and medium enterprises" sector.
The USA's Small Business Administration had its loan guarantee authority cut by half - yet to a still enviable $5 billion in FY 2003. But other departments have picked up slack.
The US Department of Agriculture (USDA) beefed up its Rural Business-Cooperative Service. The Economic Development Administration (EDA) supports "economically-distressed areas, regions, and communities". The International Trade Administration (ITA) helps exporters - as do OPIC (Overseas Private Investment Corporation), US Commercial Service, Department of Commerce (mainly through its Technology Administration), Minority Business Development Agency, US Department of Treasury, and a myriad other organizations - governmental, non-governmental, and private sector.
Another key player is academe. New proposed bipartisan legislation will earmark $20 million to encourage universities to set up business incubators. Research institutes all over world - from Israel to UK - work closely with start-ups and entrepreneurs to develop new products and license them. They often spawn joint ventures with commercial enterprises or spin-off their own firms to exploit technologies developed by their scientists.
MIT's Technology Licensing Office processes two inventions a day and files 3-5 patent applications a week. Since 1988, it started 100 new companies. It works closely with Cambridge Entrepreneurship Center (UK), Asian Entrepreneurship Development Center (Taiwan), Turkish Venture Capital Association, and other institutions in Japan, Israel, Canada, and Latin America.
Sam Vaknin ( http://samvak.tripod.com ) is the author of Malignant Self Love - Narcissism Revisited and After the Rain - How the West Lost the East. He served as a columnist for Central Europe Review, PopMatters, and eBookWeb , and Bellaonline, and as a United Press International (UPI) Senior Business Correspondent. He is the the editor of mental health and Central East Europe categories in The Open Directory and Suite101.