Irish entrepreneurial spirit to fore

THE Irish are the most fearless in Europe when it comes to going into business for themselves but the latest figures show they are losing courage.

Almost three-quarters say fear of failing is not a good enough reason to become self-employed. This attitude has resulted in Ireland having 200,000 actual or aspiring entrepreneurs - the highest in the EU.

In countries like Germany and Austria 61% say they would not consider going into business for themselves if there was a chance it might fail. But in the past two years such fears have increased, not just in Ireland but throughout the EU generally and even in the US. In 2002, 25% of Irish feared failure, while for the EU generally the figure has gone from 45% to 50% and even in the US, it has jumped from 27% to 33%.

The figures come from a survey of people across Europe, the US, Norway and Iceland carried out by the EU to compare different attitudes towards entrepreneurship.

The EU wants to increase the number of Richard Branson’s and Tony Ryan’s willing to go into business for themselves and sees this as essential to shake up the flagging economy.

Enterprise and Industry Commissioner Gunter Verheugen described entrepreneurs as the economic DNA that is needed to build competitiveness and innovation in Europe.

Boosting entrepreneurship will be a core element in future initiatives to improve the competitiveness of the economy. “Entrepreneurship can be exciting and rewarding, but it also involves risks and hard work,” he said.

Most of those questioned were very clear on the risks - in Ireland, they were afraid of going bankrupt and losing their property if the business failed.

“There is a stigma attached to failing in Europe, while in the US, banks and lending establishments consider that it is valuable experience that does not put them off lending to the entrepreneur willing to have another try,” said a commission spokesperson.

There was also a broad agreement on what are the disincentives to starting up at all. Number one for Irish people is red tape and form-filling, while the number two obstacle was a lack of finance.

Ireland has made it considerably easier to set up businesses over the past few years and while its still seen as a problem, it appears to be an even greater problem across the other EU member states and even in the US.

Despite the fears and problems, however, an impressive 38% of Irish questioned said they could be tempted to become self-employed within the next five years. This compared to just a third of Europeans generally and 46% in the US.

Over the past three years, an impressive 6% of the Irish questioned said they had started or taken over a new business that was still operating. This rate was double that in the US and higher than the 5% EU average.

A larger proportion of Irish were also thinking about becoming self-employed, at 22%, which was higher than the EU average.

When it came to why people would like to go into business for themselves the reasons were surprising. Only 15% of Irish, 23% of Europeans and just 9% of Americans said it was for better income.