Total early-stage entrepreneurial activity (TEA, the percentage of 18-64 population who are either a nascent entrepreneur or owner-manager of a new business) has been growing for three years. This among the key findings from the latest GEM Spain National Report.
In 2023, 13.5% of the adult Spanish population was immersed in the start-up and consolidation of an entrepreneurial initiative. 6.8% were involved in a business project that is less than three and a half years old, and 6.7% were leading an established business, meaning that there was one early-stage entrepreneur for every established business.
Despite perceiving unfavorable conditions for entrepreneurship in 2023, the percentage of potential entrepreneurs grew from 9.4% to 11.2%, a level not reached in Spain since 2012. However, in 2023, the percentage of people who exited a business increased from 2.5% in 2022, the lowest rate among its benchmark countries, to 3.2% in 2023.
According to the report Executive Summary: “These data reflect a healthy entrepreneurial process in which more and more people with entrepreneurial intentions are becoming real entrepreneurs. Although the dynamics of the market, to some extent, purge those entrepreneurs who are forced to exit a business or decide to transfer the business and eventually correct the percentage of companies that consolidate over time.”
Motivations
The motivation for self-employment decreased significantly in 2023 among early-stage entrepreneurial activity, from 71% of entrepreneurs surveyed in 2022 to only 57% in 2023. Two in five entrepreneurs started a business to make a difference in the world or to earn a high income; only one in five did so to continue a family tradition. If entrepreneurs start businesses to make a difference or to earn higher incomes, they will not give them up so easily if other job alternatives arise.
However, in the case of entrepreneurs running established businesses, the percentage of those who started a business because work was scarce remained at 70%, and only one in four did so to make a difference in the world, a lower percentage than in the previous year.
Concerns about the Conditions for Entrepreneurship
Experts continue to rate Spain's national conditions for entrepreneurship negatively. According to the National Entrepreneurial Context Index (NECI), Spain is placed in the last quartile for the quality of the entrepreneurial environment among 45 countries. Spain ranks low in perceived opportunities to start a business (44/45) and ease of doing so (41/45), contributing to a higher fear of failure than the average.
Entrepreneurial activity in Spain has grown more slowly compared to peer countries. Despite recent increases, Spain still lags behind other comparable countries. However, Spain has one of the lowest rates of business closures among its reference countries.
Ana Fernandez Laviada, President of GEM Spain, noted: “Improving conditions to make entrepreneurship more attractive and turning entrepreneurial aspirations into high-impact businesses are key challenges for policymakers and educators to ensure future growth in entrepreneurial activity.”
The report authors are Nuria Calvo (Universidade da Coruña), Ana Fernández-Laviada (Universidad de Cantabria), Ariadna Monje-Amor (Universidade da Coruña) and Yago Atrio (Universidade de Santiago de Compostela). The report reflects the efforts of 27 regional teams and the invaluable support of ENISA, the MAPFRE Observatory of Sustainable Finance and all the many sponsors who make this collaborative work possible at the regional level.
The report was unveiled at the end of May in front of a number of policymakers and prominent guests. Access the report launch event recording and the complete report (report in Spanish; there is an Executive Summary in English on page 20).