Sustainability startups and where to find them : Investigating the share of sustainability startups across entrepreneurial ecosystems and the causal drivers of differences

Abstract

While it is well known where the best entrepreneurial ecosystems can be found in general, such information is missing in the case of sustainability entrepreneurial ecosystems. These are entrepreneurial ecosystems with high shares of startups that are active in industries which address the Sustainable Development Goals through innovation. Not knowing what the best sustainability entrepreneurial ecosystems are, inhibits sustainability startups to locate to regions with the most favourable supportive conditions. This paper addresses the above-mentioned gap by establishing a ranking of entrepreneurial ecosystems according to their share of sustainability enterprises. For this purpose, we have analysed the websites of 19,997 startups in the 28 largest entrepreneurial ecosystems according to the Startup Genome project using Latent Dirichlet Allocation. We find that the highest proportion of sustainability startups among these entrepreneurial ecosystems is located in Boston, followed by Houston, Seattle and Lagos, respectively. A qualitative comparative analysis of the causal patterns underlying our results reveals that high GDP in combination with either (1) high shares of female founders of startups or (2) high shares of non-religious people in the population induce entrepreneurial ecosystems with relatively high levels of sustainability enterprises. Our work aims to stimulate further scholarly interest in sustainability-oriented entrepreneurial ecosystems. Policy makers can use the causal drivers to increase the share of sustainability startups in their region.