How to be a public entrepreneur

Rowan Conway at the RSA: “Political theorist Elinor Ostrom was the first to coin the phrase “public entrepreneur” in her 1965 UCLA PhD thesis where she proposed that government actors should be the makers of purpose-driven businesses. She later went on to surprise the world of economics by winning a Nobel prize.

To the economic establishment Ostrom was a social scientist and her theories of common goods and public purpose enterprise ran counter to the economic orthodoxy. 44 years later, at the same time that she was taking the stage as the first (and only) woman to win a Nobel prize for economics, another California-based thinker was positing his own vision for entrepreneurship… “Move fast and break things” was famously Mark Zuckerberg’s credo for Silicon Valley entrepreneurs. “Unless you are breaking stuff,” he said in 2009, “you are not moving fast enough.” This phrase came to epitomise the “fail fast” start-up culture that has seeped into our consciousness and redefined modern life in the last decade.

Public vs Private entrepreneurs

So which of these two types of entrepreneurship should prevail? I’d say that they’re not playing on the same field and barely even playing the same game. While the Silicon Valley model glorifies the frat boys who dreamt up tech start-ups in their dorm rooms and took the “self-made” financial gains when big tech took off, public entrepreneurs are not cast from this mold. They are the government actors taking on the system to solve social and environmental problems and the idea of “breaking things” won’t appeal to them. “Moving fast”, however, speaks to their ambitions for an agile government that wants to make change in a digital world.

Public entrepreneurs are socially minded — but they differ from social entrepreneurs in that they carry out a public or state role. In a Centre for Public Impact briefing paper entitled “Enter the Public Entrepreneur” the difference is clear:

“While “social entrepreneurs” are people outside government, public entrepreneurs act within government and, at their heart, are a blend of two different roles: that of a public servant, and that of an entrepreneur. The underlying premise is that these roles are usually distinct but the skill sets they require need not be. Indeed, the future public servant will increasingly need to think and act like an entrepreneur — building new relationships, leveraging resources, working across sector lines and acting, and sometimes failing, fast.”

Today we publish a RSA Lab report entitled “Move Fast and Fix Things” in partnership with Innovate UK. The report examines the role of Public Entrepreneurs who want to find ways to move fast without leaving a trail of destruction. It builds on the literature that makes the case for public missionsand entrepreneurship in government and acts as a kind of “how to guide” for those in the public sector who want to think and act like entrepreneurs, but sometimes feel like they are pushing up against an immovable bureaucratic system.

Acting entrepreneurially with procurement

A useful distinction of types of government innovation by the European Commission describes “innovation in government” as transforming public administration, such as the shift to digital service provision and “innovation through government” as initiatives that “foster innovation elsewhere in society, such as the public procurement of innovation”. Our report looks at public procurement — specifically the Small Business Research Initiative (SBRI) — as a route for innovation through government.

Governments have catalytic spending power. The UK public sector alone spends over £251.5 billion annually procuring goods and services which accounts for 33% of public sector spend and 13.7% of GDP. A profound shift in practice is required if government is to proactively use this power to stimulate innovation in the way that Mariana Mazzucato, author of The Entrepreneurial State calls for. As Director of the UCL Institute for Innovation and Public Purpose she advocates for “mission-oriented innovation” which can enable speed as it has “not only a rate, but also a direction” — purposefully using government’s purchasing power to stimulate innovation for good.

But getting procurement professionals to understand how to be entrepreneurial with public funds is no mean feat….(More)”.