Chapter 4: A Global Entrepreneurship Monitor perspective on the quality of the South African national entrepreneurial ecosystem

Ecosystems, specifically entrepreneurial ecosystems (EEs), have received increasing attention in strategy research and practice. Entrepreneurial ecosystems include the multitude of factors that either promote or inhibit entrepreneurship in a specific region or area. They are the result of interactions within a limited geographic area involving start-ups, established businesses, investors, incubators, policymakers and other stakeholders. Measurement and data collection are crucial to better understand EE elements’ relative strengths or weaknesses. Global Entrepreneurship Monitor (GEM) assesses the perceived quality of the national EE using its entrepreneurial framework conditions (EFCs) approach, which are the important determinants of entrepreneurial activity and its effect on economic growth. The National Entrepreneurial Context Index (NECI) is a composite index that shows the average state and quality of an EE in a country and compares it to other economies. Findings show that from the 13 EFCs, South Africa is scoring inefficiently, with entrepreneurship at the school level scoring the lowest. South Africa is also ranked in the bottom three countries regarding the NECI, with only Iran and Venezuela scoring lower.