Informal professional networks and communities are more important for entrepreneurial success than formal structures such as incubators and accelerators, according to new research.
This is according to the Economist Intelligence Unit (EIU), which has released its Informal Innovation: Entrepreneurship and Informal Communities report, sponsored by Infocomm Media Development Authority, based on a survey of 1,000 entrepreneurs across ten cities with reputations as innovation hubs.
The research found that informal networks are a vital source of support to 78 per cent of startups, while 58 per cent of the entrepreneurs surveyed belong to business networking groups on platforms such as Facebook and LinkedIn.
The greater the number of networking activities entrepreneurs engage in, the more likely that they will deem themselves stronger than their competitors, according to the report.
It also said governments have a role to play in enabling informal communities, though any support should be at an arm’s length. Experts opined that governments should provide indirect funding of space and logistics, while allowing the ecosystems to grow organically.
“It’s difficult to overstate the value of entrepreneurs’ face-to-face interaction over cocktails, lunches and in other types of informal settings, but they are also avid online networkers. Here they get advice on practical matters such as solving technology challenges, where to search for particular specialists or identifying sources of government support,” Charles Ross, the editor of the report, said.