My seed fund management company (Maverick), which is currently managing SeedCapital (a portuguese YCombinator clone), is organizing the 3rd edition of Kickstart, a workshop that we run every semester to help projects and ideas go into the startup phase and, hopefully, to choose some of them for investment.
In the past editions we have been pretty happy with the number of candidates, the number of selected teams and the number of projects with investment potential (see here and here). As for the current edition we have received zero proposals. Zero.
I’m currently teaching Entrepreneurship at the portuguese Catholic University and in one of the sessions we discussed the level of risk aversion in Portugal and the level of entrepreneurship. My students were very perplexed by this apparent paradox: Portugal is one of the top entrepreneurial countries; but its also one of the most risk averse.
Out comes the academic in me to provide literature supporting the argument…
Some years back, Geert Hofstede made a study of several countries’ characteristics, including risk aversion. At the time Guatemala was the most risk averse country and Portugal was second. The current version of the study shows that Guatemala got better and is now in 3rd place while Greece is now the most risk averse country in the world. Portugal? Still in second place.
Strangely enough, whereas Greece’s entrepreneurial level (52nd place) is consistent with its risk aversion level, Portugal is on the Top 25 Most Entrepreneurial countries in the world. Paradox? Not really.
Portuguese are quite entrepreneurial but are still risk averse. They are quite disposed and able to become their own bosses. But their entrepreneurial spirit is focused on creating small businesses and lifestyle businesses: a restaurant, a clothing shop, a bar, a hairdresser salon, a newsstand, a consulting/freelance job, etc. Something that basically doesnt defy the status quo, something that is safe, something that wont shock friends and family and that assures that one doesnt deviate from the norm. Portuguese are still provincial, they are rather happy to create businesses that are focused on our small country and that just provide living expenses. They are still uncapable of thinking with a European (or worldwide) focus. They are still uncapable of thinking big, of having a chance to make millions.
As for the start of this article, regarding Kickstart and the number of candidates, I guess that the small company, the on-the-side project, both usually complemented by a “real” job or a consulting gig providing “safety” (and most of all social approval), are the nowadays version of the hairdresser salon.