European integration has made big strides and opened new opportunities in many areas of social, political, and economical life--but entrepreneurship has conspicuously lagged behind. This paper:
* reviews the current situation of entrepreneurship in Europe
* explains why fragmentation and the domestic orientation of entrepreneurs presents a challenge to Europe's long-term economic vitality and competitiveness
* argues that the current entrepreneurship policy paradigm cannot deliver the objectives set for Europe in the Lisbon Summit declaration
* proposes a more proactive and genuinely European approach to entrepreneurship
* outlines a set of guiding principles for a new policy aimed at stimulating the birth and growth of pan-European growth champions.
While large, established firms have greatly benefited from the opportunities created by the integration of European economies, the Internal Market has yet to stimulate the birth and development of high growth pan-European start-ups. Business Objects, easyJet, Ryanair and SAP are still exceptions in a region where the majority of new companies do not grow outside their home market, where financial and human capital are sought locally, and where the average age of large firms is remarkably high. The annual survey published by Growth+ underlines how few European growth champions are known beyond their own borders.
The US economy, by contrast, is largely fuelled by Amazon, Amgen, AOL, Apple, Blockbuster, Compaq (now part of Hewlett-Packard), Dell, eBay, MCI, Microsoft, Oracle, Starbucks, SouthWest Airlines, Subway, Sun Microsystems, Yahool, and many more other young technology and service firms that did not exist 30 years ago.
It can be argued, of course, that the maturity of European large firms does not necessarily mean that they are less healthy or less competitive than younger US firms. And indeed, many 'old' European companies, such as Nokia, Siemens. VW, Philips, Lafarge, Arcelor, BP, Unilever, Airbus or British Airways are global leaders.
The threat for Europe does not lie so much in the competitiveness of today's large, established champions, although decline is always a possibility. The problem is in Europe's inability to stimulate the birth and growth of a new generation of firms that can rejuvenate …