The development of an urban start-up ecosystem and the experience of a university-business cooperation project

Tim Gittins
Corvinus University Budapest

Loretta Huszak
Corvinus University Budapest

Gabor Kerekgyarto
Corvinus University Budapest


Change in the Central and Eastern Europe (CEE) region has featured transition from centrally planned status and is associated with ongoing technological change (Welter and Smallbone, 2011). This process has coincided with the emergence of entrepreneurial ecosystems as a field of academic research. Entrepreneurial ecosystems embody the presence of actors in the form of state based institutions, universities and private sector stakeholders whereby social capital may be enhanced to boost entrepreneurial activity. This paper focuses on the current status of the entrepreneurial ecosystem in Budapest, considered in a context of socio-economic transition (Jáki, Molnár and Kádár 2019).
The aim is therefore to enhance knowledge of ecosystems in the CEE region by focusing on local ecosystem development in Budapest. A prime objective is that of encouraging participation of entrepreneurship students in terms of experiencing operational functions of ecosystems. Further objectives include:-
• Generation of knowledge pertaining to the Budapest ecosystem in terms of the functions and roles of respective actors.
• Using results to provide a framework for further comparative work of other urban ecosystems in the CEE region.

Perceptions of the operational viability of an ecosystem may depend on the cultural and socio-economic context within which it is set. In general terms, ecosystems may be perceived as relatively more operationally effective in cities such as San Francisco and Berlin located in highly developed economies (Cohan, 2018). To this point, conceptual and empirical research on ecosystems has been conducted in established entrepreneurial cultures such as the USA and in Western Europe (Hernández-Sánchez et al, 2019). Relatively few empirically oriented studies have focused on ecosystems, perhaps because of a lack of agreement as to definition of outcomes. Limited attention has however been paid to their development in the CEE region.
The conceptual rationale for ecosystems in this paper is initially examined with specific reference to the Triple Helix theory of university-ecosystem linkage (Etkowitz, 2003). . Development of the Budapest ecosystem is subsequently outlined in the form of a pilot-based research project conducted by students at Corvinus University, Budapest in Spring 2019 using a mixed methods approach. This project may therefore be used as a basis for comparison of local urban ecosystems within the CEE region whereby paths for deeper integration of student activity may be discerned. Ensuing comparative studies of ecosystems in the CEE region are proposed to follow a mixed methods approach of both qualitative and quantitative methods.
This is essentially a conceptually based paper whereby use is made of extant research to establish a partial basis for comparative research of ecosystems in the CEE region. At this point in time the field of entrepreneurial ecosystems considered as a research based entity is in a relatively nascent state but evidence exists pertaining to the notional presence of ecosystems in various geographical locations. However, while there is no clear agreement as to how an entrepreneurial ecosystem may be conceptually defined, it may be argued that their existence is predominantly noticeable in urban settings and also possesses a major presence of universities as key actors (Miller and Acs, 2017).
The extent to which entrepreneurship oriented university degree level programmes are integrated with extra-curricular activities may also partly determine the extent of entrepreneurial vibrancy within ecosystems. Thus the presence of ecosystems may influence the nature of pedagogy in teaching of entrepreneurship. This paper therefore acts as a medium of enquiry as to the nature and extent of ecosystem development in the CEE region which is relatively unexplored compared with more developed regions in Western Europe and North America.

Entrepreneurship in the CEE region is perceived to be relatively less structurally embedded than in more developed market economies. However, the revival of pre-Communist era entrepreneurship may be associated with innovation-driven economic development resonant of relatively strong technically oriented human capital in the region. Local ecosystem development infers active participation of universities in terms of involving students in actually experiencing its operational functions. Insights within this paper identify the nature and direction of externally derived human and social capital development influencing the Budapest ecosystem as well as interaction of these phenomena within it. This has the prime purpose of meeting the aim of constructing knowledge of the Budapest ecosystem in order to act as a guide for its future path of development.