In the United States, startups have an approximately 20% success rate after their first year of operations, and in other countries, the percentage is even lower. In countries like the U.S., terms like late stage capitalism have become far more popular over the past few years, especially amongst the rise of corporate profits and struggling young businesses. Today, we had the opportunity to visit the Central Bohemian Innovation Center here in Prague and learned about how the Czech Republic breaks this mold by aiming to support innovation and research.
To encourage the growth of young Czech Companies, the Central Bohemian Innovation Center teaches courses and offers to guide new entrepreneurs through the most common pitfalls that may occur during the first year. The center also looks to connect researchers with technically aligned companies that may be able to produce products that comprise a tangible result of the new breakthroughs. This is a very interesting and applicable use of macroeconomic principles to generate GDP growth – by investing in the growth of young startup companies, the Czech Republic will reap the rewards when these companies grow large and increase the economic output multiplier. Thanks to the Central Bohemian Innovation Center, we learned that the startup success rate in the Prague region is at 96%. While the Czech Republic is a small country, it is a proof of concept for larger countries like the United States which should immediately take advantage. Overall, I greatly enjoyed witnessing a practical example of macroeconomics from my minor studies and will keep in mind just how successful businesses in this country are.
Sources:
– Startup success rates
Swanson School of Engineering 