Meeting its Waterloo? Recycling in entrepreneurial ecosystems after anchor firm collapse

ABSTRACT

The ‘recycling’ of people, capital, and ideas within an entrepreneurial ecosystem is a key process driving high-growth entrepreneurship. Skilled workers who leave firms after successful exits or firm collapse bring knowledge and insights that they can use to start new ventures or work at existing scale-up firms. This makes large anchor firms important actors in attracting workers who may subsequently recycle into the local ecosystem. However, there is limited empirical research on recycling into an ecosystem after the loss of an anchor firm. This paper develops a novel methodology using career history data to track recycling into ecosystems. The paper develops a study of Waterloo, Ontario, home to the smartphone manufacturer Blackberry, whose decline in 2008 represented a significant shock to the local entrepreneurial ecosystem. We find that alumni of this firm engaged in very little high-growth entrepreneurship, instead entering the ecosystem as technology employees at high-growth scale-up firms. This was aided by the region's increased institutional capacity to match skilled workers with new ventures, ensuring the continued success of the ecosystem over time. These findings provide a more nuanced understanding of the role of anchor firms in entrepreneurial ecosystems and how recycling affects the dynamics of entrepreneurial ecosystems.

KEYWORDS:

• entrepreneurial ecosystems
• regional resilience
• anchor firms
• Canada

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Acknowledgments

The authors are grateful for the helpful comments made by the editors and three anonymous reviewers, as well as feedback on previous versions of this paper presented at conferences and the Creating Digital Opportunities Partnership annual meetings. We thank John Barber, Martin Holicka and Ondrej Bohdal for research assistance. We would like to acknowledge financial support from Social Sciences and Humanities Research Council of Canada and the University of Waterloo. This paper represents the equal contributions of the authors. Any errors and omissions remain the responsibility of the authors.

Disclosure Statement

No potential conflict of interest was reported by the authors.

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article. Please see Correction (http://dx.doi.org/10.1080/08985626.2021.1930732)