Where are the most fruitful centres for sustainability start-ups?

Of all known centres for entrepreneurship, Boston has the highest proportion of sustainability start-ups. Houston and Seattle are in second and third place. This is shown by a study by Utrecht University, led by associate professor of innovation sciences Frank van Rijnsoever. The world's best-known start-up location Silicon Valley finishes in 11th place.

"Sustainability start-ups are new companies working on solutions to societal problems, and are very skilled in coming up with revolutionary solutions. Knowing where sustainability start-ups flourish helps policymakers to determine what conditions are needed to stimulate the establishment and development of these start-ups," says Van Rijnsoever. His research group analysed the websites of almost 20 000 start-ups in the 28 largest entrepreneurial landscapes according to the Startup Genome project. The study by Van Rijnsoever and colleagues analysed the share of sustainability start-ups located in these popular locations. In Boston, about 14% of all start-ups are sustainable, in Silicon Valley less than 10%.

High proportion female entrepreneurs is decisive

After identifying these locations, the researchers went further. What characteristics ensure that sustainability start-ups flourish just here? Van Rijnsoever explains: "In addition to strong economy being a contributing factor, it turns out that a high proportion of female entrepreneurs is very decisive. This is because female entrepreneurs are generally more concerned with the social impact of their business." In addition, a high proportion of non-religious people in the population is also found to correlate with more sustainability start-ups in that area. Van Rijnsoever: "This finding needs further investigation. It is possible that locations with a higher educated population are less religious, or that sustainability start-ups take over part of the benefactor role of religious organisations."

Sustainable development goals

A sustainability start-up was defined by the researchers as a start-up that contributes to at least one of the 17 sustainable development goals of the United Nations. Van Rijnsoever: "You see that most sustainability start-ups contribute to the goals Good Health and Welfare, and Quality Education. The number of start-ups that deal with the environment is on the other hand quite low." To determine the contribution to these development goals, the researchers built an algorithm that analysed the websites of thousands of start-ups using a technique called topic modelling. The algorithm picked out the websites that included the words 'social entrepreneurship', 'ecological sustainability entrepreneurship' and 'responsible entrepreneurship'.

Follow-up study

This study is a first step towards more research on centres for sustainability start-ups. Using the same technique, the researchers want to analyse and explain the share of sustainability start-ups in 260 European regions. This will help policy makers to promote the establishment and development of sustainability start-ups in certain areas. Van Rijnsoever: "The big advantage of European regions is that there is much more data available. We can make more recommendations based on that. But with the knowledge we have now, stimulating female entrepreneurship would already be a step in the right direction."

This study was carried out as part of the PhD research of Dr Sarah Tiba. Frank van Rijnsoever is associate professor of innovation sciences at Utrecht University.