One of the great trends we’ve been witnessing over the past decade has been what you might call the “democratization of entrepreneurship.” It’s powerful and will have a huge impact not just on the U.S. economy and workforce, but perhaps even more intensely on other areas of the world—particularly developing economies. There are four key underlying factors that underpin this shift that are worth noting:

1. Geographic boundaries are breaking down

Fundamentally, entrepreneurial communities are networks—not hierarchies. As such, they thrive best in open environments that lack artificial restrictions. They also thrive best when information sharing is free and when entrepreneurs have access to other entrepreneurs. In this way, entrepreneurial communities follow Metcalfe’s law of networks which states that the power of a network increases exponentially with the number of nodes in that network; thus, entrepreneurial communities are exponentially stronger as they add more entrepreneurs to their network.

Entrepreneurial communities are networks, not hierarchies. Tweet This Quote

The globalization of economies, combined with the free flow of information fostered by the internet and other media, have enabled entrepreneurs to establish connections that extend beyond traditional geographic boundaries and create virtual communities of peers where they once couldn’t exist.

2. Entrepreneurship is becoming more highly valued

While many societies have thought of themselves as entrepreneurial, it’s really only been in the past 10-15 years that entrepreneurs, as members of the creative class, have been truly celebrated. Once, striking out on one’s own was considered overly risky. Working in big companies, or in some cases state enterprise, was the path to job security and economic independence.

Acceptance of entrepreneurship is opening doors for many people around the world. Tweet This Quote

Now, in many parts of the world, entrepreneurship is embraced. This acceptance, and even celebration, of entrepreneurship is opening doors for many people around the world that were recently closed due to cultural and economic pressures.

3. Entrepreneurs don’t care about pedigree

Above, I referenced the belief that entrepreneurial communities are networks, not hierarchies. Openness, the free flow of information, the lack of community gatekeepers, and entrepreneurs as leaders are hallmarks of these networks (versus hierarchies that are closed, tend to have a small number of people who control access to the system, and where information flow is controlled and limited).

More and more, entrepreneurs are judged by their ideas, not their family name or university. Tweet This Quote

As a result, one of the fundamental tenants that underpins these networks is a decreased emphasis on pedigree, background and connections. While this hasn’t completely taken hold in all countries, in many places entrepreneurs are rightly judged by the strength of their ideas, the value they bring to the community and the success of their past efforts—not on their family name or where they attended school. This has opened the door for many entrepreneurs who 10 or 20 years ago would have found themselves cut off from the opportunities they have today.

4. Entrepreneurship focuses on giving first

One of the most powerful trends in support of the democratization of entrepreneurship has been the establishment of broad mentor networks that support entrepreneurial communities. These networks are aided by the trends noted above and stem from the fundamental belief that a larger and larger number of experienced entrepreneurs are embracing the idea of giving first, getting later. Ultimately, the best mentor relationships become two-way, but the initial expectation of the mentor needs to be that they’re participating first to give with no expectation of anything they’ll personally take away—other than the satisfaction of helping out.

A larger number of experienced entrepreneurs are embracing the idea of giving first, getting later. Tweet This Quote

The development of these mentor ecosystems—bolstered by the rise around the world of accelerator programs—has allowed entrepreneurs greater access to advice and counsel. This helps create better entrepreneurs and more vibrant entrepreneurial ecosystems.

Fundamentally, the world benefits from the democratization of entrepreneurship as more people look to themselves as the engine to grow beyond their circumstances. Importantly, this phrase works in reverse as well—entrepreneurship promotes democratization. Entrepreneurs value the stable systems that democracy tends to bring—they see themselves (and not government) as the answer to their societies’ challenges, they provide jobs and economic stability, and they work in networks that by their nature are more democratic than hierarchical.

I don’t have a crystal ball, and I don’t know exactly what the next 20 or 50 years will bring. But I do believe that the global trend towards entrepreneurship will continue and that the world will be much better for it.


A version of this post originally published on UNREASONABLE.is on June 24, 2013. It has been updated and reposted to inspire further conversation.

About the author

Seth Levine

Seth Levine

Seth is a Boulder, CO based technology investor and managing director at Foundry Group. His career spans venture capital investing as well as operational, transactional and advisory roles at both public and private companies.

  • Tammy Hartmann

    An answer to your question: what key factors are needed to grow entrepreneurial ecosystems?

    The factors require lots of discussion, which means involving decision-makers, especially those within political and cultural circles. I feel entrepreneurship is overwhelming for many countries instead of working on systemic change first. Sometimes the reverse approach works where, if the system refuses to change, we have to push an idea of how to save the world by doing. Communities should be empowered and allowed to participate in the decision-making process. Like you said, we have no clue what 20 to 50 years from now will look like, and that is what scares me the most.

    Seth, thank you for the article.

  • Kaylee Raucci

    Thank you for the post! I agree with this post. To answer your question, I would say that people need to start branching out to grow the entrepreneurial ecosystem. This only makes sense, communities and companies need to start making moves and approaching new people. They need to broaden their horizons and think of not only the future but the past. We can make the future of entrepreneurs better if we see what was done correctly and incorrectly. Showing you can be different and let other peoples opinions count will excel your company in more ways than you think. Give it a try at least, and push your limits to something you’re not comfortable doing. Think outside the box, it will make you stand out from the rest.

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  • Todd Smith

    Seth, interesting article. In my personal opinion, one of the key things needed to truly grow an entrepreneurial ecosystem is access to capital. And by that, I mean true seed capital, and not investors only willing to invest after a company has a five-figure revenue run rate and gobs of customers. If we truly want to prime the pump and give more businesses started, we need to help entrepreneurs get that first $10K, $25K, $100K to get them going. Only a minority of entrepreneurs has access to friends and family who can support their ambitions.

    It is my hope that Title III of the JOBS Act, will truly bring about the democratization of capital in lock step with your democratization of entrepreneurship, whereby people can support entrepreneurs in their local communities or startups on the other side of the world. What are your thoughts on equity crowdfunding?

  • Todd Smith

    Seth, interesting article. In my personal opinion, one of the key things needed to truly grow an entrepreneurial ecosystem is access to capital. And by that, I mean true seed capital, and not investors only willing to invest after a company has a five-figure revenue run rate and gobs of customers. If we truly want to prime the pump and get more businesses started, we need to help entrepreneurs get that first $10K, $25K, $100K to get them going. Only a minority of entrepreneurs has access to friends and family who can support their ambitions.

    It is my hope that Title III of the JOBS Act, will truly bring about the democratization of capital in lock step with your democratization of entrepreneurship, whereby people can support entrepreneurs in their local communities or startups on the other side of the world. What are your thoughts on equity crowdfunding?

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  • Ariel Lande

    I agree completely with your post.
    We are at an exciting time for entrepreneurship, especially due to the communicative
    ability of the entire world. We have the capacity to communicate with anyone in
    any part of the world, and the means to make that capacity available to the
    masses. As a result, the most important factor needed to grow an
    entrepreneurial system in any country or community, is the human capital of
    each community. There needs to be many people in every area who are have a
    burning desire to innovate and improve society for everyone, in order for an
    entrepreneurial climate to flourish. If people all over the world are
    consistently taught to conform, or to be happy with the status quo, then an
    entrepreneurial ecosystem will not develop anywhere, or will developed as a flawed
    system that only benefits few.

    You mentioned that the
    democratization of society leads to more entrepreneurship, and that the reverse
    is true. However, that reverse will never be possible without the development
    of entrepreneurs in every society. As a result, the mentor systems that are
    currently expanding have to continue to expand. The message that the world’s
    problems can be solved through innovations, that one must have the moxie to
    change the world, must become more widespread in the coming years. The world has
    made good progress, that’s for sure, but it’s still not enough.

    Another comment mentioned that the
    access to capital is the most important factor to create an entrepreneurial
    ecosystem, but I don’t think that’s true. I see that as the next step, for if
    the entrepreneurial spirit is there, then entrepreneurs all over the world will
    be able to use the network that they’ll inevitably develop to acquire the funds
    necessary to start their ventures. All in all, current entrepreneurs must use
    their ability to connect with the entire world in order to show the future
    generation of entrepreneurs what it means to be innovative, what it means to be
    a change-maker. That way, we can create the new entrepreneurial ecosystems that’ll
    benefit us all.

  • Kaitlin J

    I hope this is true. I agree that anyone can become an entrepreneur with the right motivation and opportunity, and there certainly exist a wide array of entrepreneurs. That said, I think it’s hard to deny that the things that help make an entrepreneur successful – usually, access to networks and investment funds – tend to favor those with privilege and educational “pedigree,” to use the article’s words. While I appreciate the article’s optimism, I wish it had addresses those realities a bit more directly.

  • Aaron Ps Schwartz

    Hello Seth,

    Thank you for your post; I found it to be very intriguing and thought-provoking. I agree wholeheartedly with the points you have made, as really entrepreneurship in itself is based upon flat-structures, transparency, and access to other members of the business cycle, which is mainly achieved through networking. As you mentioned by alluding to Metcalf’s Law, entrepreneurship embodies this precisely, as it grows more powerful and influential as any network does, as the power of the network increases exponentially as the number of nodes increases. This trend is being carried out as we speak, as technology and democratization has enabled society to reach that exponential curve, where the more entrepreneurs that “join the chain” the more powerful the overall movement is becoming. This is why social media and sites like Unreasonable.is and even LinkedIn are the future, as they bring together many like-minded individuals to be able to achieve synergy through their combined skills and knowledge. At the very least, it allows us to learn from others, as I have in your post. Thank you again for the excellent post and I look forward to seeing more from you in the future.

    Best Regards,

    Aaron Schwartz