The EU has boosted business growth and created hundreds of new companies by connecting over 4,500 pairs of aspiring entrepreneurs and established business owners in an exchange program. The entrepreneurs stay in another country and work in a successful small business there for one to sixth months. New entrepreneurs develop their practical experience, and both parties gain insight into other countries’ markets and make international contacts.
Results & Impact
A third of the aspiring entrepreneurs who participated (36.5%) have created their own business and over half said the exchange made a positive contribution to the start of their company. 65% of host entrepreneurs, significantly above the European average, have extended operations to new national markets after the program, with a quarter operating in the country of the visiting entrepreneur. Participants’ business growth has also been stronger than average for European small enterprises. These are positive results given the 5% drop in overall business creation in Europe from 2009-2011.
The European Commission, EUROCHAMBRES, The EU’s Executive Agency for Small and Medium-sized Enterprises (EASME), The European Parliament, Intermediary Organizations
Aspiring entrepreneurs spend between one and sixth months with a host in another participating country. For flexibility, it is possible to split the exchange into slots spread over 12 months. The application is facilitated by local Intermediary organisations, such as national Chambers of Commerce and nonprofits in the sector. The program gives financial support to new entrepreneurs for travel and subsistence. Depending on the country, they get a monthly grant of $605 to $1,250.
28 EU Member States and 9 additional participating countries
Entrepreneurs, young people
Cost & Value
Funding for the present period of 2014-2020 comes from Europe’s program for the Competitiveness of Small and Medium-sized Enterprises (COSME), with $63.2 million allocated. This will support at least 10,000 exchanges.
Running since 2009
Free movement in the EU creates a particularly congenial context for business exchanges. Exporting the program to other countries would generate new challenges around visas. Intermediary Organisations – such as national Chambers of Commerce and nonprofits in the sector – are also required to facilitate the application process. There are currently 174 Intermediary Organisations across 30 of the 37 participating countries, but expansion would require first identifying new ones.
The European Union has boosted economic growth by connecting over 4,500 early-stage entrepreneurs and small businesses with more experienced hosts in a cross-border exchange program, Erasmus for Young Entrepreneurs.
Newly established or potential entrepreneurs stay with and learn from experienced entrepreneurs running small businesses in other countries. They gain firsthand, practical experience and develop entrepreneurial skills and competencies. The host benefits from opportunities to learn about new markets, collaborate with foreign partners and gain fresh perspective on their business.
The project aims to contribute to reducing unemployment in Europe, especially among the young, by boosting growth and job opportunities.
The most popular destination country so far for new entrepreneurs has been Spain, which received 764 new entrepreneurs, followed by Italy, the UK, Germany and Belgium.
Stays last between one and sixth months, although it is possible to split the time into several slots over 12 months, providing flexibility. The program provides financial support for subsistence and travel to aspiring entrepreneurs. This comes in the form of a monthly grant, between $605 to $1,250, depending on the country.
The exchange helps aspiring entrepreneurs develop the skills to establish and run their own small company. This is particularly important in the context of Europe’s slowdown in entrepreneurship, with people still reeling from the financial crisis. There was a 5% drop in overall business creation in Europe from 2009-2011, and given this backdrop, the program has had strong results. A third of the potential entrepreneurs who participated have created their own business after the program, and over half said that the exchange had a positive impact on the start of their company.
Both hosts and new businesses benefitted from the fresh perspective their exchange partners offered. Participants’ business growth has been above average for Europe. After the exchange, 61% of new entrepreneurs and 54% of hosts increased turnover and 56% of hosts and 30% of new entrepreneurs hired more staff.
Participants also benefit from the opportunity to gain inside perspective on new markets and develop their ability to attract new clients from other countries and cultures. Almost two-thirds of host entrepreneurs, significantly above the European average, have extended operations to new national markets after the program, with a quarter operating in the country of the visiting entrepreneur. Half the new entrepreneurs found a partner to sell products/services to or to purchase from during the stay.
So far, cooperation has taken place in all sectors. However, the most popular have been advertising and promotion, education and training, and architecture and construction services.
The program was created within the framework of the Small Business Act for Europe which considers the exchange a key contribution to creating an environment in which entrepreneurship is rewarded and can thrive. It is also a key part of the Entrepreneurship 2020 Action Plan, which aims to reignite entrepreneurial spirit in Europe and support new businesses. The program is funded in the current period under the EU’s Cooperation for Small and Medium-sized Enterprises (COSME) scheme. About $63 million has been allocated for 2014-2020, which will fund around 10,000 exchanges.
There is interest in expanding the scope of the programme beyond Europe and there is a plan to build a network of former participants. These plans may face hurdles, as the issue of visas would need to be addressed outside of the European free movement area. There would also be a need to identify the new local Intermediary Organisations – such as national Chambers of Commerce and nonprofits in the sector – required to facilitate the application process. Currently there are 174 Intermediary Organisations across 30 of the 37 participating countries.
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