The ‘why’ of innovation ecosystems

By: Iain Klugman & Avvey Peters

In our kickoff post of this series, we looked at the ‘what’ of innovation ecosystems.

Now we’d like to talk about the ‘why.’ As in, why economies, communities and companies perform better when we come together across sectors to face challenges and solve problems.

If you attended the Global Ecosystem Summit we co-hosted with Startup Genome and Elevate in Toronto on Oct. 1, you’ll already have a handle on the attributes of healthy ecosystems and the people who lead them – qualities like humility, inclusivity, generosity, ambition, collaborative spirit, adaptability and resilience, to name a few.

The question is, what are we really trying to achieve when we build ecosystems?

Often it’s assumed that they're all about fostering the growth of high-potential tech startups, by supporting founders and helping them attract investment.

While those activities are important, they give a far too narrow view of what ecosystems can and should be: accelerants for industries and prosperity engines for communities and countries.

Ecosystems offer a broad, new model of economic development – one that’s focused less on “buffalo hunting” (attracting big companies) than on activating all the “species” (economic participants, big and small) that make up a community.

We arrived at this truth through many years of work to help build ecosystems in Waterloo Region, across Canada and, more recently, around the world. We started out with a mission to help tech companies, but quickly found that the best way forward was to be intentional about engaging a broad set of partners – from industry, various levels of government and academia to civic groups, social agencies and cultural institutions.

When you can bring different kinds of people together and activate them in common cause, there is a value exchange among all players, where everyone contributes and everyone benefits. This leads to other good things, including:

• Community cohesion and belonging. Most people love to be part of something bigger than themselves. Diverse ecosystems with a common goal create a shared sense of ownership and trust among participants, enabling them to overcome differences and get things done.
• Resilience and adaptability. The more diverse and broad-based the ecosystem, the better it can withstand bumps in the road and adapt to fast-changing conditions. And there’s no shortage of bumps and change these days.
• Economic strength and competitiveness. By embracing divergent viewpoints, ecosystems encourage and energize people to come up with novel business ideas and find solutions to big problems. (No shortage of those, either.)
• Healthy regeneration. As in nature, innovation ecosystems follow a continuous cycle of life and death, as fresh ideas spring up from soil made richer by those that have passed on.

Maybe you’re wondering how we can be so upbeat about ecosystems when the world is staring down so many gnarly challenges: climate change, a health-care crisis, AI adoption, polarized politics, unaffordable housing, to name some of the bigger ones.

Our answer is, it’s precisely because of the complexity of these challenges that we need to reach out beyond our individual sectors and work together.

When we limit our thinking around ecosystems to startups, investors and tech support organizations, we not only limit our potential to find the best solutions, but to build stronger economies and healthier communities.

Our work in ecosystem building has taken us from Canada to Europe to the Caribbean. In every jurisdiction we have seen the power of ecosystems at work – that diversity of knowledge and perspectives leads to stronger results, more resilient communities, and an ability to meet complex challenges.

If you’d like to know more about how NorthGuide can help, feel free to reach out. In the meantime, thanks for reading. We’ll see you back in this space soon.