How Do Silos Stagnate Startup Ecosystems?

When silos exist in startup ecosystems, systems, processes, and organizations act in isolation. Silos create inefficiencies that ultimately harm startups, along with the other organizations involved in the ecosystem.

For startup ecosystems to retain good health, the flow of data, knowledge, talent, funding, and other resources is essential. In this post, we will explore three types of silos that generate inefficiencies and stagnate startup ecosystems, stopping the flow of resources and ideas.

1. Insufficient Ecosystem Mapping

When roles of entrepreneur-support organizations are not transparent, startups often have difficulty figuring out which organizations to work with, and organizations’ operations often overlap significantly. Startups need specific assistance during each stage of their development, so it is crucial that they are able to identify organizations that are best-suited to their developmental needs. If organizations are all providing similar services, there will be unmet needs during key stages of startup development. Additionally, operational overlap also means that entrepreneur-support organizations will be competing for funding from similar sources.

Using Startup Commons’ Ecosystem Mapping Tool, ecosystem developers can solve the problems of operational overlap and startups identifying the proper support organizations. Rather than simply listing support organizations, our mapping tool illustrates the role each organization plays in relation to startups’ development phases.

2. Opaque Impact Metrics

When organizations fail to adopt and share common impact metrics, operations become less transparent, funding becomes a guessing game, and all accountability is lost. Similar to how customer acquisition rates and costs quantify startup success, impact metrics should be used to quantify the success of support-organization operations and government programs. Before anything can be improved, it first needs to be measured.

Startup Commons’ KPI Data Dashboard makes data collection and benchmarking easy. With our comprehensive tool, ecosystem developers and policy makers can make data-driven decisions to implement ecosystem-growth strategies.

3. Segregated Vertical

Events, support organizations, and startup communities often focus on specific verticals, such as biotech or video games. This leads to echo chambers and closed sub-communities within larger startup ecosystems. Similar to academia, these sector-specific silos create narrow-minded thinking and reduce cross-sector collaboration, which is essential for tackling difficult problems.

For example, what does a fintech company do if they are trying to encourage millennials to provide microloans to smallholder farmers? Although they may be able to build a transaction platform on their own, it may be wise for them to partner with agtech companies to source potential loan candidates, along with video game developers to produce interactive educational content.

Startup Commons breaks down silos associated with specific verticals using the Ecosystem Portal. This one-stop-shop showcases events, people, startups, and service providers in your ecosystem.

Now that you understand how silos can stagnate startup ecosystems, we hope you take time to investigate Startup Commons’ digital solutions. If you want to learn more, feel free to contact us!