Austrian Young People and Entrepreneurship
In July 2016, TechCrunch published an article titled “Austria: The up-and-coming early-stage investment capital of Europe”. To many, Austria can seem like a country of the past, one whose very charm lies in the fact that its best days are behind it. The Austro-Hungarian Empire collapsed almost 100 years ago, and, with it, the aspirations this landlocked, Central European nation of 8.5 million had to control the global stage. Perhaps that’s why the Austrian startup scene has been so easy to overlook. With Germany to the north and the high-tech Netherlands beyond that, few have paid attention to the rapid changes taking place on the other side of the Alps. Austria, this country of old charms, is beginning to position itself as one of the most attractive bases in the world to launch a new company. And in light of recent successes, including the biggest exit in Austrian startup history — Adidas’s $240 million acquisition of the fitness app Runtastic — there’s reason to believe the startup scene could take on a big role in Europe’s future. Austria has a number of natural advantages its entrepreneurs are hoping to channel into a lasting infrastructure. It’s located in the heart of Europe, within a three-hour trip of every major capital on the continent. Costs of development are low, meaning it’s cheaper for companies to make mistakes early on — which is why various mobile phone carriers use Austria to test and roll out services. And while investors have been hesitant to embrace the startup market, Austria, a traditionally wealthy country, won’t lack for resources once the overall mindset catches up to that of the emerging entrepreneurial generation.
Social entrepreneurship in Austria is still a young sector – 75% of all initiatives are not older than four years. But they are growing constantly – as is the awareness of what social entrepreneurship is and how social innovation can contribute to societal development.
According to a recent study by the Vienna University of Economics and Business, there are around 270 social entrepreneurs to be found in Austria. An infrastructure to support them is slowly emerging, providing co-working spaces, consulting, training or access to networks of supporters. Many individuals do not yet realise that they are in fact social entrepreneurs and that there is a new career pathway unfolding, which receives increasing public acknowledgement. That is why raising awareness about this new type of work and business model, entrepreneurial culture and new career opportunities are still at the forefront of the efforts of organisations such as Impact Hub Viennaand Ashoka. Both have helped the term “social entrepreneurship” become mainstream in Austria.
Generating income on their own as well as gaining more financial independence is a major issue for Austrian social entrepreneurs. According to the Vienna university study, more than half (52%) of social entrepreneurs’ budget comes from private funding, one-third comes from their own earnings, while roughly 10% come from federal sources.
Specific social venture funds do not yet exist in Austria. The financial sector, as well as the social entrepreneurs themselves, still need to capture the opportunities of social financing. One pioneer is Good.Bee, which is providing financing for social enterprises and works in the field of micro-finance in central and eastern Europe. Crowd-funding is also a source of funding: online platforms such as respekt.net help to connect promising projects with investors.
A new career path
Many young people in Austria do not yet realise that there is a new career path that combines entrepreneurial spirit with solving major social challenges. But several social entrepreneurship support-organisations such as Impact HUB Vienna, awards such as The Social Impact Award or training programmes like Pioneers of Change in Vienna especially attract young social entrepreneurs.
These young aspiring talents have a very unique and fresh approach to deal with a multitude of social problems: whatchado is helping young people to find out what career paths exist and how to get there. They interview people from different backgrounds and sectors and feature them in short films to explain how they became what they are today. Dachgold is convincing companies to use solar energy to cover their energy needs because they use most of their energy during the day (unlike many private households). Since solar energy storage is very inefficient, using the energy right away during the day is a very sustainable solution.
It is not just a lack of knowledge and access which inhibit young social entrepreneurs from starting their own initiative – they are often just afraid to take the risks of founding their own projects. Ashoka fellow Johannes Lindner responded to this by starting Entrepreneurship Education in many Austrian schools and helps students become more entrepreneurial, self-dependent and lose the fear of taking initiative. Johannes’s business plan competitions encourage young people to combine their entrepreneurial thinking with self-driven action. Each year, 2,500 students participate in these competitions, and two-thirds of the projects are actually implemented. In Austrian secondary schools, 20,000 students benefit weekly from the teaching and learning content developed by him.
Young people no longer want to adapt to often rigid and uninspired structures in established organisations and companies. Instead, they would prefer to set up their own enterprises where they can live their values, be creative and shape the impact they want to have on society. Without a doubt, Austrians will have to take more risks to solve social problems. As Melinda Gates, wife of Bill, the Microsoft billionaire, says “We believe in taking risks because that’s how you move things along.”