American entrepreneurs are driving innovation worldwide, according to a new Babson report.
The United States has more "high-potential entrepreneurs " -- those involved in technology and knowledge-transfer industries -- than any other industrialized nation, according to the seventh-annual U.S. Global Entrepreneurship Monitor.
Directed by Babson College and the London Business School, the GEM study found that nine out of 10 U.S. entrepreneurs are "opportunity entrepreneurs." Only one out of 10 start a new business out of necessity because there are no better choices for work.
Early-stage entrepreneurship in the U.S. has maintained a greater stability in the past year than in the other G7 nations -- Canada, Japan, France, Germany, Great Britain, and Italy. The study also showed that the U.S. has more early-stage and high-expectation entrepreneurship, greater investment rates, and an overall healthier economy.
"This supports an overall view that the U.S. has changed from a managerial society to an entrepreneurial society," said Stephen Spinelli, vice provost of entrepreneurship and global management at Babson. "We have recovered to pre-9/11 levels [of entrepreneurship] while other G7 countries have not."
GEM calculated the number of individuals between the ages of 18 and 64 who have taken some action toward creating a new business in the past year, along with the number of new business owners, to estimate the level of involvement in early-stage entrepreneurial activity across the globe.
The nations with the highest rate of early-stage entrepreneurial activity include Venezuela (25%), Thailand (20.7%) and New Zealand (17.6%) The countries with the lowest rate include Belgium (3.9%), Japan (2.2%), and Hungary (1.9%).
"For U.S. entrepreneurs, it seems to take less money to get the business up and running, where in other countries, like Japan, it's more expensive -- which probably has to do with the culture," said Elaine Allen, associate professor of statistics and entrepreneurship at Babson.
The GEM study found that these high-potential entrepreneurs in the U.S. are primarily young men from the upper-income group who are motivated by opportunity and have little fear of failure. They also tend to have high self-esteem, are skillful in choosing opportunities, and benefit from a deep network of other entrepreneurs and angel investors. These so-called HPEs have increased U.S. productivity levels more than 100% in recent years, according to GEM.
"High-potential entrepreneurs internationally are driven by the HPEs in the U.S.," Allen said. "We are definitely leading the way."