Building a supportive ecosystem for green entrepreneurs is a critical step in the transition to a more sustainable economy. This chapter describes and assesses the green entrepreneurship ecosystem in Portugal, considering an ecosystem framework that is based on two components and related sub-components: institutional arrangements (i.e. strategies, institutions, culture and networks) and resource endowments (i.e. markets, knowledge, leadership and finance). Recommendations are made for strengthening the ecosystem and an action plan is provided on how the main recommendations could be implemented. International good practice models are included in the action plan to illustrate how relevant actions are implemented in other countries.
The Green Transition of SMEs and Entrepreneurship in Portugal
Abstract
Entrepreneurship ecosystems play a vital role in fostering the creation and growth of new businesses by facilitating access to resources for entrepreneurs and setting the “rules of the game”. This chapter applies an ecosystem model based on two core components: the formal and informal institutional arrangements; and the resource endowments. Ecosystems often emerge in locations with place-specific assets (e.g. infrastructure, research institutions, large established businesses) and high levels of “entrepreneurship recycling”, where entrepreneurs start many firms and invest in and support other entrepreneurs.
Some research suggests that entrepreneurship ecosystems are often more important for green entrepreneurs than for traditional and social entrepreneurs because, on average, they face greater difficulties accessing resources. This is due in part to regulatory and market uncertainties, and start-ups developing green technologies often face longer development timelines relative to those developing other types of technologies. Furthermore, many green start-ups seek highly specialised support services including laboratories and testing facilities.
The institutional arrangements for green entrepreneurship in Portugal’s national entrepreneurship ecosystem are still developing. Entrepreneurship has been a policy priority in recent years and the national ecosystem has developed rapidly following substantial public investment. Several entrepreneurship and innovation strategies highlight the need to develop green entrepreneurship, including the Recovery and Resilience Plan. These are policies and initiatives implemented by a large number of public actors, notably Startup Portugal, the Portuguese Agency for Competitiveness and Innovation (IAPMEI), the National Innovation Agency (ANI) and the Institute of Employment and Training (IEFP). These actors generally collaborate effectively, but occasionally report challenges due a lack of experience in implementing support for green entrepreneurs.
Informal institutional arrangements are strong within the green entrepreneurship ecosystem. There is a robust entrepreneurship culture and high levels of awareness about environmental sustainability challenges and opportunities. However, green entrepreneurs would benefit from greater networking opportunities, as well as increased access to opportunities in foreign markets.
The green entrepreneurship ecosystem is characterised by a high level of knowledge creation but markets that are growing slower than in neighbouring countries. Financial resources are limited for green start-ups and the long-term development of the ecosystem would benefit from a clear leader on the green entrepreneurship agenda.
Policy priorities going forward include developing stronger policy directions by creating a strategy that presents the core objectives contained in the various strategies and sets a clear course for the future. Greater levels of training can be offered to public sector staff in green entrepreneurship and incubators could do more to facilitate international opportunities for green start-ups.
Entrepreneurship ecosystems have an important role in fostering the creation and growth of new businesses by facilitating access to resources for entrepreneurs and setting the “rules of the game”. The ecosystem concept is relatively new, and a widely shared definition has not yet emerged (Stam and van de Ven, 2021[1]). Despite several variations of the concept being used in academic and policy contexts, there are a number of common threads that are consistently highlighted. These include a critical mass of diverse of actors that are actively engaged in supporting entrepreneurs (e.g. entrepreneurs, lenders and investors, institutions such as universities and government) and effective interactions and relationships between them. Entrepreneurship ecosystems can be industry specific, or include several industries, and they are geographically bounded but not necessarily confined to a specific scale. Governments play a strong role in fostering the development of entrepreneurship ecosystems, both as core actors that deliver services within an ecosystem, as well as the role that public policies have in directly and indirectly establishing the “rules” and norms that facilitate and govern the interactions between actors.
One of the most well-known models of an entrepreneurial ecosystem is based on two core components (Stam and van de Ven, 2021[1]), namely the institutional arrangements and resource endowments within the system that facilitate the creation of productive entrepreneurship (Figure 7.1). Institutional arrangements include three sub-components: formal institutions (i.e. the policies, regulations other mechanisms that determine rules for entrepreneurs and other actors); culture (i.e. attitudes towards entrepreneurship, including awareness, ambitions and motivations); and networks (i.e. formal and informal connections between different actors). Resource endowments are captured by: physical infrastructure (i.e. roads, railways and air travel that connect entrepreneurs and other actors); demand (i.e. market demand for the goods and services produced within the ecosystem); intermediaries (i.e. presence of business service providers); Talent (i.e. availability of skills to entrepreneurs); knowledge (i.e. R&D and innovation); leadership (i.e. clear leaders in the ecosystem to drive collective action); and, finance (i.e. availability of finance to start and grown new firms).
Source: (Stam and van de Ven, 2021[1])
A number of common features are found across many thriving entrepreneurship ecosystems. First, ecosystems often emerge in locations with place-specific assets, including proximity to infrastructure that can facilitate access to markets and cultural attractions that can help attract and retain talent. There is also often at least one large established business undertaking R&D that can act as a “talent magnet” and drive local development. Universities and other educational institutions (e.g. vocational educational training centres) also play an important role in ecosystems, largely for developing students that transition into the ecosystem rather than for their research and spin-out activities. A second feature that is common to many ecosystems is “entrepreneurship recycling”, where entrepreneurs remain active in the ecosystem after exiting or selling their firms, either as “serial” entrepreneurs that go on to start other new firms or as advisers and investors. Third, ecosystems are typically “information rich” where individuals can easily access information and knowledge through a wide range of formal and informal channels. Fourth, the availability of finance is critical, particularly seed and start-up investors who provide investments and hands-on support based on their experience. Finally, it is important to recognise the need for the presence of service providers such as lawyers, business consultants and accountants, who can assist young firms in their development by providing specialised professional services. For additional discussion of entrepreneurship ecosystems and their success factors, please see: (Stam and van de Ven, 2021[1]; Mason and Brown, 2014[2]).
Entrepreneurship ecosystems have a critical role to play in developing and supporting green entrepreneurs. Creating a business environment that is more aligned with the needs of green entrepreneurs and sustainable business practices is a critical step in transitioning to a more sustainable economy. Some research suggests that green entrepreneurship has different determinants than traditional and social entrepreneurship and that ecosystems and the business environment appear to have a greater influence on green entrepreneurs than traditional and social entrepreneurs (Hörisch, Kollat and Brieger, 2017[3]; IEA, 2022[4]). One of the reasons is that perceived legitimacy has a greater role in determining the success of green entrepreneurs, which is shaped by networks and relationships with other actors in the ecosystem. There is also a need for highly specialised support services, including dedicated financial instruments, as well as laboratories, testing facilities and technical expertise for those entrepreneurs working on clean technologies. Therefore, public policy can have a significant role in boosting (or hindering) green entrepreneurship through measures that shape the business environment, including the measure that incentivise green entrepreneurship.
This section examines the green entrepreneurship ecosystem in Portugal following the concept of the entrepreneurial ecosystem presented in the previous section. It provides a brief overview of the relevant actors, policies and initiatives for each of the different components and sub-components, focussing on those that are the most pertinent for stimulating and supporting green entrepreneurship. However, some of the sub-components of the resource endowments component are covered in other chapters in this report:
Talent – the availability of green skills is covered in Chapter 5, which assesses policies and programmes that boost the availability of green skills in the labour force and among entrepreneurs and SME managers.
Intermediaries – the availability of support measures and initiatives for green entrepreneurship is covered in Chapter 6.
Physical infrastructure – the concept is focussed on physical infrastructure such as roads, railways and air transportation, which is not specific to green entrepreneurship and therefore not covered.
7.2.1. Institutional arrangements have strengthened over the past decade
A core component of entrepreneurship ecosystems is the institutional arrangements that legitimise, regulate and incentivise entrepreneurship (Stam and van de Ven, 2021[1]). These include arrangements that encompass the “rules of the game”, including the regulations and public policies that determine the ease of starting and operating a business, as well as the incentives or disincentives that encourage or discourage certain types of businesses. The actors responsible for designing, implementing, and regulating these policies are also considered to be part of the formal institutional environment. Another element that is often considered is the institutional arrangements (i.e. culture) that shape social attitudes towards entrepreneurship. Many underline the importance of the interactions between actors, manifesting through formal and informal networks (Feld, 2015[5]).
Several strategies set the policy direction but messages are fragmented
The Portuguese Government has played an important role in stimulating and supporting the development of an effective entrepreneurship ecosystem in recent years. This has led to increased levels of business creation, an inflow of talent from abroad, a more comprehensive entrepreneurship support system and increased investments in start-ups. These outcomes are largely the result of a deliberate policy decision to make Portugal more entrepreneurial and many important measures were outlined in the StartUP Portugal programme (2016), including the National Strategy for Entrepreneurship (Estratégia Nacional para o Empreendedorismo) (Portugal, 2018[6]).
The StartUP Portugal programme and national strategy aimed to boost the competitiveness of the economy by creating a more business-friendly environment, boosting formal support for start-ups and small businesses and increasing the availability of finance for new businesses. One of the main methods of working towards these objectives was to move towards a model of designing and implementing entrepreneurship support in a more co-ordinated way. The StartUP Portugal programme was initially focussed on building a strong technology sector, but this has since been broadened by placing entrepreneurship as a key component of recent economic and innovation strategies and policies that underline priorities related to the green and digital transitions.
This placement of entrepreneurship as a vehicle for supporting the green and digital transitions is evident in the Portugal 2030 Programme, which implements the Partnership Agreement between Portugal and the European Commission over the period 2021 and 2027 (Portugal, 2023[7]). One of the strategic objectives of this plan is to create “A Greener Portugal”, which seeks to make progress in the areas of decarbonisation, energy efficiency, renewable energy, circular economy and sustainable mobility. A combination of thematic and regional programmes is used to work towards achieving the strategic objectives, including the thematic programme “Sustainable 2030” that is dedicated to climate action and sustainability.
This overarching policy was reinforced with Portugal’s Recovery and Resilience Plan (RRP) in 2021, which sets out reforms that will be implemented until 2026 (European Commission, 2021[8]). The RRP underlines the role of entrepreneurship in facilitating the green and digital transitions, including through the introduction of measures that invest in renewable energy, the greening of business practices and green research among others. Of the EUR 22 billion received from the European Commission for the RRP, more than EUR 7 billion are allocated to support the green transition (European Union, 2023[9]). One of the mechanisms used to implement these investments and projects is a series of “Mobilising Agendas” that fund projects that are implemented by consortia that are comprised of companies, business associations, universities, research centres and public entities (Portugal, 2023[10]).
This approach to funding green projects through consortia is similar how other OECD countries such as Israel disburse funding for industrial innovation and supporting the business sector in the green transition (OECD, 2022[11]). There are several benefits to this approach, notably that different actors are engaged projects that have positive outcomes for environmental sustainability. This results in short-term gains as the projects are realised, as well as longer-term benefits since actors are likely to adopt more environmentally sustainable practices as a result of the experience. In addition, the use of consortia builds synergies across different sectors and fosters a collaborative learning mindset that can continue after the projects are finished. In Portugal, however, few green entrepreneurs appear to be members of funded consortia relative to similar programmes in other OECD countries. In Israel, for example, the involvement of start-ups in consortia funded by the Innovation Authority is a condition for funding. The challenge in Portugal is that green entrepreneurs are typically not operating at a scale to support the implementation of large commercialisation projects related to renewable energy. Directing funding toward consortia that include green entrepreneurs could help ensure the long-term success of Mobilising Agendas because there are some indications of dwindling interest from the private sector as a growing number of consortia report that private enterprises are withdrawing due to changes in their corporate strategies (Essential Business, 2023[12]). These funding opportunities would likely be relatively more important for green entrepreneurs than for large corporations so their motivation for active participation in projects would likely be higher. The inclusion of entrepreneurs in these consortia could offer an incentive for large firms to maintain their participation through the development of broader commercial relationships (e.g. as a potential supplier) and through learning from the entrepreneurs (e.g. new technology developments).
In parallel to these high-level economic strategies, a wide range of more focussed national strategies directly promote green entrepreneurship as a strategic priority and/or as a vehicle to promote for achieving economic transitions. Strategies such as the following can help create new market opportunities for green entrepreneurs and shift the business culture towards the use of more environmentally sustainable practices:
Technological and Business Innovation Strategy 2018-2030 (ANI, 2018[13]);
National Strategy for a Smart Specialisation 2030 (ANI, 2022[14]; Interreg Europe, 2022[15]);
Roadmap for Carbon Neutrality 2050 (Minister of the Environment and Energy Transition, 2019[16]);
National Energy and Climate Plan 2021-2030 (Portugal, 2019[17]); and
Leading the transition: a circular economy action plan for Portugal 2018-2020 (Ministry of Environment, 2017[18]).
It is important to underline that non-government stakeholders have actively participated in developing and implementing these strategies, thereby enhancing the likelihood of achieving their objectives. This is well-illustrated by the Portugal Green Growth Commitment 2030. This set of objectives was adopted by the government in 2015 following a voluntary commitment made by private, public, and civil society stakeholders in 2014 to move towards a green growth economy (Portugal, 2015[19]). It identified 14 goals for 2020 and 2030, covering a range of issues such as increasing “green” gross value added (GVA), creating “green” jobs, reusing waste, and improved energy and water efficiency. While none are singularly targeted at green entrepreneurship, green entrepreneurs could have a strong role in achieving each of the targets.
Overall, the collection of national strategies and policies collectively work to support EU-level goals, including those outlined in the European Green Deal (European Commission, 2021[20]) as well as more specific strategies such as the New Circular Economy Action Plan: For a cleaner and more competitive Europe (European Commission, 2020[21]). They send several very strong signals, notably that entrepreneurship is viewed as being an important vehicle for innovation and economic growth, and that there is a commitment to continue to invest in strengthening the entrepreneurship support infrastructure. This provides clear incentives for the business sector to engage and also helps build positive attitudes towards entrepreneurship, particularly green entrepreneurship. The creation of positive attitudes towards green entrepreneurship should ensure that the next generation of entrepreneurs are greener, and boost demand for more sustainable products and business practices from consumers. At the same time, the government faces some communication challenges because the reactive approach to developing strategies and policies has resulted in policy messages that are disbursed across many documents.
Moreover, some important gaps remain in the overall direction set for green entrepreneurship. First, little attention has been placed on measuring green entrepreneurship. Policy development is hindered by a lack of data on the barriers to green entrepreneurship and on the scale and scope of current green activities by new start-ups. Some OECD countries such as Canada and Israel have made investments in developing data on green entrepreneurship to have better-informed policies. Within the EU, Eurostat has made some advances and there are some examples of countries developing data on specific fields such as the development of data on the circular economy in the Netherlands (see Chapter 6).
Second, there is a bias towards technology driven green entrepreneurship in many Portuguese policies. This is likely due to the legacy of entrepreneurship policies over the past five-to-ten years that heavily focused on promoting digital technologies. The benefit of investing in clean and sustainable technology-driven entrepreneurship is that there is potential for generating high value-added activities that can drive economic growth. Moreover, this type of entrepreneurship could lead to radical innovations that have a significant impact on reducing or even reversing environmental damage. Yet this should not exclude supporting non-tech green entrepreneurs achieving overarching policy targets will require all start-ups to be greener. This calls for opening up support initiatives to non-technology-based start-ups that reduce environmental damage, including for example, through the circular economy (see Box 7.2), as well as introducing a broad concept of green entrepreneurship in education and awareness campaigns.
The circular economy is an economic model of production and consumption that involves sharing, leasing, re-using, repairing, refurbishing and recycling existing materials and products as long as possible (European Parliament, 2023[22]). Implicitly, this model aims to keep waste to a minimum by extending the lifespan of product through re-use, repairs and recycling whenever possible. A greater role for the circular economy presents many opportunities for entrepreneurs, not only to find new ways to reusing waste and outputs but also to design products that have a longer lifespan.
Portugal supports the circular economy through a national action plan and a number of schemes. The main action plan was the National Action Plan for the Circular Economy 2018-22, which was adopted in 2017 (Ministry of Environment, 2017[18]) and covered three levels:
National level: Based on the 2015 EU Circular Economy Action Plan, it presented seven key areas for policy: i) Design, repair and reuse; ii) Incentivising and circular market; iii) Educating for a circular market; iv) Eat without waste; v) A new life for waste; vi) Regenerating resources: water and nutrients; and vii) Researching and innovating for a circular economy. Specific actions included green taxation, voluntary agreements and dedicated funds.
Sectoral level: Identified priority sectors for policy action such as construction, that are resource intensive, or those that had a high exposure to exports, such as tourism and textiles.
Regional level: Developed five regional agendas to implement actions to achieve national objectives in the different regional contexts.
An assessment of the action plan found that 44 of the 57 guidelines were addressed (77%) (European Environment Agency, 2022[23]). However, the area of the action plan where the least amount of progress was made was Action 1 (Design, repair and reuse), where only half of the guidelines were implemented.
The follow-up action plan for the period 2023-27 was under consultation in October and November 2024 (Participa, 2024[24]).
Many actors collaborate to implement policies and there is more to gain from fine-tuning their co-ordination
One of the primary actors in delivering support for entrepreneurs is Startup Portugal. It is a private non-profit organisation with the Statute of Public Utility (Decree-Law 33/2019 of March 4th) and its mission is to develop activities of public interest for the promotion of entrepreneurship, in close connection with public and private entities operating in the national entrepreneurship ecosystem (Startup Portugal, 2024[25]). It manages a wide range of programmes such as Business Abroad, Start Now Cry Later, or the SIM Conference. One recent key instrument to support entrepreneurs is Vouchers for Startups – New Green and Digital Products, which provides grants of up to EUR 30 000 to entrepreneurs developing new green and digital products (see Chapter 6).
However, Startup Portugal also has a significant role in the recent development of the entrepreneurship ecosystem. To further this role, the Vouchers for Incubators and Accelerators measure was developed to increase the capacity of business incubators to support start-ups. It has a total budget allocation of EUR 20 million from the RRP, which provides funding of EUR 30 000 to EUR 150 000 to support incubators and accelerators. The goal is to create conditions for the applicants to invest in their human and technological development to better support their incubated start-ups (Startup Portugal, 2024[26]). Eligible costs include expenses associated with technical personnel directly involved in project implementation, accreditation or technological certification of staff, acquisition of equipment or specialised external services related to the project, protection of intellectual property rights, as well as some indirect project costs. Eligible projects have a maximum duration of 18 months, and their implementation must start within three months after the support decision is made. All projects must be completed by 30 September 2025. Proposed projects are assessed for their relevance to the call, the capacity of the management team to implement the project and the potential impact of the project on the competitiveness of the beneficiaries (IAPMEI et al., 2023[27]). Funding decisions are made within 90 business days following the quarterly cut-off date and timing is suspended if applicants are asked for clarifications or additional information. Although some stakeholders reported that such a long evaluation period creates difficulties covering anticipated costs such as hiring staff to develop a new programme, Startup Portugal places a high priority on ensuring the financial viability of applicants and projects.
This innovative approach holds strong potential for supporting the development of the ecosystem and for strengthening its capacity to support green entrepreneurs. Though the grant would likely cover part of the cost for acquiring specialised equipment, or for developing and delivering a programme, it does reduce the operating costs, which is an incentive of delivering support to green entrepreneurs. The longer-term impact needs further investigation, to ensure continuity of the support system and the development of tools so that beneficiaries are able to secure the follow-up funding needed to maintain activities in a sustainable way.
Startup Portugal also plays a role in providing information to all entrepreneurs through the online One Stop Shop. This portal offers several tools including information and guidance on how to set up a company, a mapping tool to identify actors in the ecosystem, a platform where entrepreneurs can access information on support programmes, including public and private funding opportunities, and one-to-one meetings, making it an important resource for entrepreneurs. These tools help entrepreneurs (green entrepreneurs included) to locate the relevant information.
Another important public actor in supporting green entrepreneurship is the Portuguese Agency for Competitiveness and Innovation (IAPMEI), which is under the auspices of the Ministry of Economy. Its mission is to promote competitiveness and business growth through programmes aimed strengthening SME innovation, entrepreneurship and business investment (IAPMEI, 2023[28]). IAPMEI plays an important role in supporting green entrepreneurship in several respects. This includes promoting green entrepreneurship and the need for businesses to adopt more sustainable behaviours through promotional campaigns that include short videos. It also works closely with Startup Portugal in implementing many of their initiatives.
Similarly, the National Innovation Agency (ANI) supports technological and business innovation, which includes green entrepreneurship. One of its main activities is to foster collaboration between entities of the scientific and technological system and the business environment. Its main activity related to supporting green entrepreneurship is the Born from Knowledge prizes and Call InnovID (see Chapter 6), which both award funding.
The Institute for Employment and Professional Training (IEFP) also has a role in the green entrepreneurship ecosystem as the national public employment service. Its mission is to promote the creation and quality of employment and combat unemployment, through the implementation of active employment policies, particularly professional training (IEFP, 2024[29]). It implements the Green Skills and Jobs programme, which provides training to unemployed workers and those affected by the green transition in a number of areas such as energy efficiency, renewable energy, water efficiency, sustainable mobility and circular economy (see Chapter 5 for further discussion). However, there is a missed opportunity with the programmes as self-employed workers are typically not eligible to participate. Nonetheless, IEFP is working to align many of its entrepreneurship schemes such as Criação do Próprio Emprego (IEFP, 2024[30]) and Empreende XXI (IEFP and Startup Portugal, 2024[31]) with policy priorities related to the green transition, which is a positive development. Moreover, IEFP created Energy Transition Training Centres at the beginning of 2024 to deliver new training programmes that offer qualifications in areas such as renewable energy, water efficiency and sustainable mobility, and is implementing a EUR 230 million investment plan through the RRP to update equipment and training throughout its network of 55 vocational training centres. This covers for example wind and photovoltaic energy production, hydrogen, energy efficiency, electric mobility or water efficiency.
The public entities involved in implementing green entrepreneurship policies work collaboratively to deliver measures and supports. In most instances, these arrangements are working well and there is a clear benefit to leveraging the complementary strengths of different entities. However, the main public entities supporting green entrepreneurship have noted some difficulties managing organisational pressures related to the new mandates to support the green transition. Entities such as Startup Portugal have been successful in delivering new programmes related to the green transition in a short period largely using existing staff. Moreover, some programme managers seek more training and tools so they can provide even better service to entrepreneurs. Another challenge is that the lack of an overarching strategy or policy for green entrepreneurship. Consequently, it is not always clear which public entity is doing what.
Non-government actors are also very active members of the green entrepreneurship ecosystem. This includes some of the 137 business incubators from RNi - Portugal Incubators, universities, corporate champions and dedicated NGOs such as Casa do impacto, which operates a range of programmes for green entrepreneurs (see Chapter 6). Overall, the private sector is very active and nimble in responding to the needs of entrepreneurs. They have benefited from recent policies that attract international talent and have a very high level of interest in supporting the green transition because of the market opportunities it generates.
The higher education sector, including universities and polytechnic institutes, also plays an important role and there are several leading universities that make a concerted effort to bring research results to the business sector through joint projects. The inclusion of universities in joint projects, notably the consortia that are funded through the Mobilising Agendas is critical. Among other benefits, the Mobilising Agendas facilitate co-operation between businesses that are often competitors and strengthen connections to Academia. Universities are also among the most active Portuguese actors in building international links for green entrepreneurs, through research collaborations with universities and corporations abroad. However, there is scope for universities to strengthen their connections with Portuguese entrepreneurs, enabling them to leverage these relationships and capitalise on international opportunities.
There is a strong entrepreneurial culture that recognises the urgency of the green agenda
Culture and social attitudes shape entrepreneurship ecosystems by shaping individual views towards entrepreneurship. Countries, regions or cities where entrepreneurship is viewed as a desirable career path will likely have higher levels of start-ups and also a stronger support environment for entrepreneurs (Fritsch and Wyrwich, 2018[32]).
Overall, entrepreneurship is viewed very positively in Portugal. Surveys such as the Global Entrepreneurship Monitor (GEM) measure public perceptions of entrepreneurship through questions about the visibility and status of entrepreneurs. The most recent GEM survey in Portugal was conducted in 2019 and found that 72% of people reported that entrepreneurs had a high level of social status, which was slightly above the average for “high income” countries (69%) (GEM, 2019[33]). In addition, 73% indicated that it was a good career choice, well above the average for high income countries (60%). Moreover, these perceptions have increased substantially since surveys prior to the creation of Startup Portugal. For example, the 2014 survey found that 62% of respondents indicated that entrepreneurship was viewed as a good career choice and attributed a high social status to successful entrepreneurs (GEM, 2014[34]).
In addition to having a strong of entrepreneurship culture, there is a high level of awareness of environmental issues among the Portuguese population. For example, surveys show that about 95% of the population report that environmental issues directly affect their daily life (Figure 7.2). This was the second highest proportion among EU Member States. Moreover, there is high recognition that the business sector has a role to play. For example, when asked about how to tackle environmental problems, one-third of respondents indicated that there is a need to change the way that goods and services are produced and traded (Figure 7.3). One-quarter of respondents also indicated that businesses need to be encouraged to be engaged in sustainable activities.
Proportion of people reporting that environmental issues directly affect their daily life and health, 2020
Source: (European Commission, 2020[35])
Proportion of people identifying effective ways of tackling environmental problems, 2020
Source: (European Commission, 2020[35])
Green start-ups would benefit from more opportunities to build international connections
Entrepreneurial networks are groups of interconnected entrepreneurs, business service providers and various other relevant actors who entrepreneurs can access for information and ideas for the operation of their businesses in reciprocal relationships (OECD/EU, 2015[36]). They have a critical role in entrepreneurship ecosystems by functioning as the glue that holds them together. Networks help entrepreneurs access resources such as funding, ideas, employees, partners, suppliers and customers. They also have a role in influencing individuals’ perception of the desirability and feasibility of an entrepreneurship career.
There are a variety of entrepreneurship networks in Portugal, and many not only work to support their members, but also put effort into strengthening the entrepreneurship ecosystem through partnerships with other organisations, including public actors. For example, the 351 Portuguese Startup Association has grown to more than 1 600 members in the four years since it was created (351 Portuguese Startup Association, 2024[37]). This network manages a range of activities for its members such as at least two activities or events organised per week and offering support services through a network of more than 70 volunteers. In addition, it has launched or managed a broader set of initiatives for the community, including Lisboa’s Community Fund, Portugal Tech Week and Techstars Ecosystem Initiatives such as Techstars Startup Weekends and the Community Leaders Academy. It also has partnerships with public and private actors, such as Startup Portugal. Collectively, these activities are examples of the actions taken by networks to further develop the ecosystem and strengthening the start-up community. However, networks such as the 351 Portuguese Startup Association do not yet have many activities dedicated to supporting green entrepreneurship.
There are several business associations that work on supporting green entrepreneurs. One of the main associations active on environmental sustainability is the Business Council for Sustainable Development (BCSD). It is a non-profit association that represents more than 170 Portuguese companies that are committed to becoming more sustainable (BCSD Portugal, 2024[38]). These companies represent about 10% of national GDP. The BCSD’s mission is to promote a positive impact for the companies and their stakeholders, as well as for society and the environment. This mission is implemented through three activities, namely working groups that seek to foster collaboration across businesses to stimulate innovation, as well as training sessions for employees and entrepreneurs, and regular communications activities to raise awareness about sustainability issues in the business community and beyond.
There are also examples of formal networks of support actors that facilitate knowledge exchange, collaboration and resource sharing. The most prominent network is the RNi - Portugal Incubators, which is managed by Startup Portugal (Startup Portugal, 2024[39]). This network facilitates connections between the 137 incubators across the country and with other relevant actors, such as universities and technological centres, corporates and investors. This includes co-operation and sharing of resources within the network to improve the services available to entrepreneurs. This is similar to the Incubatenergy Network in the United States (US), but the US network also works to support entrepreneurs directly. One area where the Incubatenergy Network is expanding its activities is in opening international offices to help entrepreneurs establish and build international relationships. Among the formal networks in Portugal, one area for improvement is to strengthen linkages with relevant entities abroad. This is a missed opportunity for public entities who could not only help establish international contacts for the entrepreneurs but also to share good practices with their counterparts in other countries.
Informal networking is a strong in the Portuguese ecosystem. Events such as Web Summit or the SIM Conference, and other sector-specific events are important for convening entrepreneurs and helping them to expand their networks. There are many examples of these events showcasing new innovations and success stories, which can have strong role model effects for other entrepreneurs. See Chapter 6 for further discussion.
7.2.2. The ecosystem can build on its many resources
The second major component of entrepreneurial ecosystems is resource endowments, which includes the knowledge, finance and pools of suitably skilled labour to that enable entrepreneurs to implement their ideas (Stam and van de Ven, 2021[1]). In addition, there needs to be product-market fit for the goods and services produced by entrepreneurs in order for their businesses to be sustainable. Finally, leadership within the ecosystem can provide direction to the range of actors and entities engaged in green entrepreneurship. This can be critical for building and maintaining a healthy ecosystem and can gain from the involvement of entrepreneurs dedicated to the region, as well as a strong commitment from the political leaders and public actors. As noted earlier, some elements of resource endowments are covered in other chapters so they will not be addressed in this section. This section focusses on markets, knowledge, leadership and finance.
Green markets are growing but at a slower rate than some neighbouring countries
In the context of ecosystems, market demand is typically measured as a combination of income and potential demand (Stam and van de Ven, 2021[1]). When focussing on green entrepreneurship ecosystems, some approximations are needed because there are substantial data gaps that hinder estimates of demand for green products and services. First, establishing clear definitions of green products and services remains challenging, which makes it very difficult to estimate the extent to which they are demanded by consumers, businesses and public entities. Second, it is therefore not known how much consumers, businesses and public entities spend in the green economy as a proportion of their total expenditures. Third, it is difficult to estimate potential demand for green products and services because nearly all have substitutes that are less expensive (and less green). Therefore, price elasticities need to also be considered (i.e. how demand responds to prices), which depend not only on income but also the extent to which consumers assign a positive value to the benefits of purchasing green products and services when lower cost alternatives are available.
Eurostat estimates show that value added in green goods and service sectors in Portugal (referred to as environmental good and services sector by Eurostat), accounted for nearly 3% of GDP in 2021. This was slightly above the proportion for the EU overall (2.5%) (Figure 7.4). Moreover, this share in Portugal has grown about 16% since 2014. This is in line with the EU average over this period, but below the growth in some neighbouring countries such as Spain (38%).
Value-added in the environmental goods and services sector as a percent of GDP, 2021
Note: Data for Ireland and Slovak Republic are estimates. Data for Belgium and Greece are preliminary.
Source: (Eurostat, 2024[40])
Knowledge creation related to environmental technologies is relatively high despite modest public investment in R&D
The generation of new knowledge is needed to fuel innovation and growth within an ecosystem (Stam and van de Ven, 2021[1]). This is distinct from talent and skills, which refers to the availability of talent inside an ecosystem (see Chapter 5). However, human capital is needed to create new knowledge. The generation of new knowledge is often estimated using different metrics of applied research.
Portugal has many universities that are engaged in environmental sustainability, including through education programmes for students, joint research projects with industry and research collaborations with other universities, including those in other countries. These activities cover a range of fields such as the circular economy, energy efficiency, renewable energies, culture of sustainability and environmental justice.
Research outputs in environmental technologies are relatively high in Portugal. In 2020, about 15% of patents granted in Portugal were related to environmental technologies (Figure 7.5). This share was among the highest third of OECD countries. About 40% of these patents were environmental management technologies, well above the share for the OECD overall (6%) (Figure 7.6). There was also a high share of patents on climate change mitigation technologies related to energy generation, transmission or distribution and the production or processing of goods. In contrast, very few patents were in the area of sustainable transportation (7%) and capture, storage, sequestration or disposal of greenhouse gases (3%).
Share of total patents that are related to environmental technologies, 2020
Source: (OECD, 2022[41])
Share of environmental technology patents according to types of technologies, 2020
Note: Patents can be classified to multiple types of technologies.
Source: (OECD, 2022[41])
However, direct public support to business R&D remains low by OECD standards (OECD, 2021[42]). Direct public support was about 0.04% of GDP in 2019, about half of the OECD average (0.08% of GDP). Grants can be effective at supporting young innovative firms since they often lack the resources to finance R&D and often cannot secure bank loans due to their risk profiles. In addition, direct public expenditures can be directed to specific types of technologies. The approach used by the Mobilising Agendas is consistent with these good practices and also attempt to increase the volume of funding invested in R&D by using EU funds to implement these projects. However, as noted earlier, the extent to which green entrepreneurs benefit from this type of funding as the support consortia do not typically include entrepreneurs.
The linkages between basic research and the public and private sectors are also crucial in the innovation process. Research policy in Portugal has tended to favour academically-oriented research and researchers are not always equipped to engage in co-operative research and innovation activities with business and the public sector (OECD, 2022[43]). There are initiatives to help bridge this gap, including, for example, the CoLab scheme. However, more could be done to engage more companies with little R&D experience and polytechnical universities that have a strong focus on professional knowledge. This could include, for example, providing toolboxes for public/private partnership agreements and identifying and promoting major centres of expertise (OECD, 2022[43]).
A clear leader for the green entrepreneurship agenda has yet to emerge
Governments can have a leadership role with respect to green entrepreneurship in national ecosystems. They have an important role in setting direction through the use of targets and providing signals to markets on the development and enforcement of regulations that reduce emissions and energy consumption. Moreover, governments can act as a role model for other entities through the improvement of energy efficiency in their buildings and reduction of emissions in their vehicles, as well as through their procurement practices.
The Portuguese government has positioned itself well with respect to providing leadership on entrepreneurship and there is an opportunity for it to play a larger leadership role on green entrepreneurship. There is wide recognition – both inside and outside of Portugal – of the important leadership role played by Startup Portugal in the recent development of the entrepreneurship ecosystem. However, many public entities are contributing to the development of green entrepreneurship, and none have emerged as a clear leader or champion on this agenda. This is likely due to several factors. First, each of the public entities engaged in delivering support to green entrepreneurs is doing so alongside their primary mandate. Therefore, each entity is recognised for a related but different activity. Second, these entities have launched their green entrepreneurship activities with great speed and face organisational challenges as a result (see earlier section). This lack of a clear leader may hinder a speedier development of green entrepreneurship in the long-term.
Accessing the small supply of early-stage finance remains a challenge for most green start-ups
The availability of finance is critical for supporting the creation and development of new firms. High potential innovative firms, including many environmental technology start-ups, seek venture capital investment since they have few or lack tangible assets that can be used to obtain finance (Breschi et al., 2019[44]). There have been significant improvements in recent years in boosting the supply of venture capital in Portugal through support for business angels and co-investment funds, and the availability of venture capital through SIFIDE Scheme funds is now starting to be rolled out to the ecosystem. However, there is also a gap between the availability of funds for early-stage and later-stage start-ups. This gap is significantly larger in Portugal than in other EU Member States (EIT Digital, 2020[45]), but is being addressed by upcoming initiatives, such as Unicorn Factory Scaleup Programme and the Global Hypergrowth initiative announced by Startup Portugal.
The Portuguese Roadmap to Carbon Neutrality outlines a number of products that will need to be further developed in Portugal to support decarbonisation and the circular economy (Minister of the Environment and Energy Transition, 2019[16]). These include green bonds, green loans, sustainable investment funds and blended finance instruments. In terms of supporting green entrepreneurs, the latter two hold the greatest potential. Green bonds are typically issued by larger, more established firms (OECD, 2022[11]) and many OECD countries have moved away from dedicated loan programmes for green entrepreneurs because many green start-ups have had difficulties repaying them even when repayment is delayed by several years (IEA, 2022[4]). However, sustainable investment funds have been growing fast across the EU as environmental, social and governance (ESG) criteria are more widely adopted. More than half of funds in the EU now use some form of ESG criteria when structuring their portfolio. These criteria open up funding opportunities for green entrepreneurs, particularly non-technology entrepreneurs who typically cannot access innovation and R&D funding instruments. Similarly, blended finance instruments can open up funding opportunities for green entrepreneurs because public funding is used to mitigate private capital risk. The use of blended instruments helps to reallocate capital towards activities with higher sustainability standards. In practice, special funds could be used to incentivise private sector participation.
There are also examples of targeted tax incentives being used to change consumer behaviour, which creates opportunities for entrepreneurs. For example, tax incentives are used to reduce the consumption of plastic bags in Portugal and there have been discussions about extending this measure to other disposable plastic-based products (OECD, 2020[46]).
The entrepreneurship ecosystem in Portugal has developed rapidly in recent years and is characterised by a number of strengths, including a growing talent pool in several technology fields, a high level of proficiency in English, growing investment opportunities and good quality of living. The results of concentrated efforts are already evident, with a growing number of start-ups, including several unicorns such as Outsystems, Talkdesk and Feedzai (Startup Portugal, 2022[47]).
The diverse actors in Portugal’s entrepreneurship ecosystem are embracing the need to do more to stimulate and support green start-ups. Many initiatives and measures have been launched to directly and indirectly support green entrepreneurs. These actions are guided by several strategies and policies that cover economic development policy, industrial policy, innovation policy, the circular economy and more. It is positive that green entrepreneurship is reflected in these areas but there are still benefits to reap from the effort to co-ordinate these policy initiatives together.
Moreover, the current set of strategies and policies are heavily focused on technology-based green start-ups. This is not surprising since recent entrepreneurship developments have been based on developing digital technologies and Portugal is well-positioned in the renewable energy sector. Going forward, there will be a need to provide more support to non-technology based green start-ups as well as supporting all start-ups in adopting the use of more sustainable business models and practices.
Another area that deserves more attention going forward is the measurement of green entrepreneurship. Some OECD countries are embedding data strategies within their green entrepreneurship strategies to outline how data collection and reporting will be strengthened. This is currently a gap in Portugal.
The public entities engaged in supporting green entrepreneurship typically work collaboratively with each other, as well as with non-government actors and the private sector. Overall, this approach is working well. However, many organisations face challenges in managing new responsibilities to support green start-ups, including staff that have not yet mastered all the skills needed to deliver specialised support to green entrepreneurs. This could be strengthened by offering short training modules and by building and leveraging international partnerships. For example, international experts could be used on selection panels, which presents informal learning opportunities for Portuguese experts.
The green entrepreneurship ecosystem benefits from a very strong entrepreneurial culture and high levels of awareness of the need to transition to a more sustainable economy. This will create market opportunities as consumers are well informed and are likely to increasingly demand green products and services. This potential could be further reinforced with actions to strengthen networks among relevant actors in Portugal and with actors abroad. Relative to other OECD countries, networking activities tend to be more informal which could lead to missed opportunities for commercialising research and collaboration. Moreover, there are few efforts that continuously seek opportunities abroad. Green start-ups would benefit from more opportunities to build networks abroad to facilitate access to new market, new ideas and world-class expertise.
7.3.1. Policy recommendations
Strengthening institutions
Develop a green entrepreneurship strategy to connect green entrepreneurship policy objectives, identify priority actions and co-ordinate support system. This could be a concise document that consolidates the policy messages contained in the relevant economic and environmental strategies.
Improve data collection to enable more informed policymaking by articulating a plan to collect data on green entrepreneurship, starting with those start-ups and early-stage firms receiving public support. The data collection could be expanded over time as public programmes and the size of the green economy expand. Data should be published regularly and used in communication efforts to promote green entrepreneurship.
Provide training modules to public sector staff working on green start-ups support programmes. Training efforts could be expanded over time to include short modules for all public sector staff that support entrepreneurship to ensure that all start-ups are using sustainable business models and practices.
Use the consortia-led projects funded through the Mobilising Agendas to help green entrepreneurs engage in research projects that may lead to commercial opportunities.
Reinforcing resource endowments
Appoint a public sector champion who can provide leadership for green entrepreneurship policy. This could be a unit or office within Startup Portugal to leverage the strong brand recognition that Startup Portugal already has. The unit/office could be given the mandate to promote green entrepreneurship, provide leadership on future policy developments, build international connections, and report on progress made in supporting green entrepreneurs.
Strengthen international networks by including international experts on juries that award entrepreneurship funding and prizes.
Continue to invest in bringing the research sector closer to the business sector by funding joint research projects.
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Rationale and description of the initiative
It would be key to develop a concise strategy to support green entrepreneurship in Portugal. Such a strategy could have several objectives, and it would be important to identify a clear leader for the green entrepreneurship agenda, which could be a unit or office in Startup Portugal. This unit could lead the development of a strategy in collaboration with the many public sector, non-government and private sector actors.
First, the strategy should aim to bring together all of the policy priorities and messages related to green entrepreneurship that are contained across a range of different economic and environmental strategies. This would help create a clear story about green entrepreneurship policy directions in Portugal by connecting the different initiatives and measures to show that together they form a cohesive support system for green entrepreneurs.
Second, the strategy could include some new actions that address some of the current gaps in the various strategies. This could include, for example, a plan for collecting and reporting data on green entrepreneurship. Some countries start by building datasets that are comprised of companies receiving public support.
The development of a green entrepreneurship strategy would benefit from a collective effort, which is becoming a common practice in developing entrepreneurship strategies in OECD countries. This can be accomplished through the organisation of a series of workshops that could be used to discuss current actions and brainstorm future priorities with the range of stakeholders.
Expected results
The outcome would be a strategic document that outlines current actions and future priorities for green entrepreneurship policy. This strategic document could also outline a roadmap for short- and medium-term actions, including resource allocations and specify which actor(s) would contribute to each action. The strategy would help bring more cohesiveness to the green entrepreneurship support system by developing a singular story around priorities and goals in Portugal. The use of a collaborative development process would help to reinforce buy-in from across all sectors and would lead to stronger networks.
Key performance/monitoring indicators
Performance and monitoring indicators for this initiative include:
Production of a strategic document.
Objectives and targets as defined in the strategy.
Number and nature of stakeholders engaged in the development of the strategy.
Number of stakeholders endorsing the strategy.
Key authorities
A key stakeholder involved in the development of a strategy would be Startup Portugal, potentially a specialised unit or office that would become the champion and leader for green entrepreneurship policy. The development of the strategy should involve all relevant public sector actors, including the Ministry of Economy, Ministry of Environment and Energy, IAPMEI, ANI, and IEFP. The success of a new green entrepreneurship strategy would also hinge on the successful engagement with non-government actors such as the universities and polytechnic higher education institutes, NGOs, corporate leaders and investors.
International policy example: Roadmap for Scaling Up Green Entrepreneurship, Israel
Description of the approach
A roadmap for green entrepreneurship in Israel was developed in 2020 following the successful implementation of the SwitchMed Training and Support Programme for Green Entrepreneurs, which is an EU-funded programme implemented through the United Nations Industrial Development Organisation. The plan identifies four objectives:
to provide services needed to create green and circular businesses;
to strengthen the capacity of support structures and build synergies and partnerships across the ecosystem;
to develop public policies that promote and support green entrepreneurship and the circular economy; and
to promote a shift in consumers’ mindset to increase the demand for green products and services.
The concise document built on a benchmarking study that was undertaken as part of the SwitchMed programme, as well as a White Paper on the challenges, opportunities and strategies for promoting green entrepreneurship and eco-innovation. The White Paper was based on more than 30 stakeholder interviews, showing strong engagement in the development of the strategy. It then used a consultation process to collect stakeholder suggestions and inputs.
Factors of success
The strategy builds on the strengths of Israel’s start-up ecosystem, namely strong support services, a supportive policy environment and the consumer mindset that is open to changing consumption patterns to respond to environmental challenges. The success of the strategy will depend on these factors continuing to hold in the future, as well as continued growth in demand for green products and services from consumers and businesses.
Obstacles and responses
No significant obstacles were faced in the development of the roadmap. However, there has not been any systematic reporting on progress achieved. Regular reporting on achievements can help maintain momentum across the ecosystem as actors would be able to see the results of their actions.
Relevance to Portugal
This roadmap provides a model for how Portuguese policy objectives and priorities could be presented in a concise document. It also provides an indication of the actors that will work on different actions, which helps to bring some predictability to the support system. The development process was highly consultative, which is a good practice found in many OECD countries.
For further information
Website SwitchMed initative: https://switchmed.eu/wp-content/uploads/2020/04/National-Scaling-up-Roadmaps-EN-Israel.pdf
Rationale and description of the initiative
There is a need to increase the knowledge about green entrepreneurship within the public sector to enable staff to deliver on their mandates. This includes increasing awareness of the need for transforming business models and practices, policy objectives and rationale, different models of green entrepreneurship, and the support needs for green entrepreneurs, including how they are different from traditional entrepreneurs.
The Ministry of Environment and Energy could develop a short course with several modules to be delivered to core staff supporting green entrepreneurship in relevant ministries and public entities. There are several courses that could serve as a model, including the ILO course (see following example) or the MIT Sustainability Course with professional certification. These materials would need to be adapted to the Portuguese context, which could be done by the Ministry or in collaboration with a leading university.
Over time, the course could be delivered to more staff. Ultimately, the objective could be to provide at least a core module on green entrepreneurship and business models to all public servants, as all public entities will be impacted as the economy transitions to a more environmentally sustainable model.
Expected results
Training would help public servants understand the challenges faced by green entrepreneurs and SMEs wishing to become greener. This would better equip them for their roles in delivering new support programmes and awarding funding to green innovations and start-ups.
Key performance/monitoring indicators
A performance and monitoring indicator for this initiative could be:
Number of staff receiving training per year.
Key authorities
The initiative could be led by the National Agency for Vocational Education and Qualification (ANQEP), which is responsible for managing the National Qualifications Catalogue under the auspices of the Ministry of Education, Science and Innovation and the Ministry of Labour, Solidarity and Social Security, and in collaboration with the Ministry of Economy.
International policy example: Certification Programme for Green Business Trainers, ILO
Description of the approach
The Certification Programme for Green Business Trainers offers a training programme for business trainers, consultants and advisors on how to support entrepreneurs and small businesses in becoming more environmentally sustainable. It is aimed at support organisations, programme managers, business trainers, advisors and coaches, as well as financial institutions that are greening their SME portfolio.
The programme provides participants with tools and knowledge to effectively train and coach small enterprises that want to sell environmentally friendly products and/or make their processes more environmentally sustainable. The main content of the programme covers:
Resource efficiency and cleaner production,
Circular economy,
Life cycle management,
Environmental management systems,
Eco-certification and labelling.
The programme was designed to provide participants with practical tools to help them support entrepreneurs in identifying opportunities, overcoming common obstacles, different business models and management practices and more. It is based on the ITCILO/GIZ/UNEP Green Business Guide and Green Business Training Manual. It covers many topics such as:
Getting started: green business is good business,
Green business: how to go about it,
Life cycle management,
Resource efficiency and cleaner production,
Taking sustainability to the next level: Environmental Management Systems,
Communicating with markets: Environmental certification,
Working with others: Green value chains and circularity.
The training programme is delivered in two phases. The first two-week phase is comprised of in total 15 daily 90-minute webinars, following by five self-guided learning modules that are 120 minutes each. The total time investment for the first phase requires a time commitment of at least 40 hours.
The second phase is a 50-hour programme delivered over 2.5 months. It includes practical experience such as marketing and delivering a green business training to at least 10 SMEs, helping to introduce entrepreneurs to relevant support services and more. Once completing the second phase, each participant will receive a trainer’s certificate. Participants are charged a fee of EUR 1 110.
Factors of success
The success of the training programme will depend on its ability to provide practical knowledge and tools to trainers. This will likely require some sector-specific knowledge and training materials will need to be regularly updated to reflect new developments and innovations in the market.
Obstacles and responses
The main obstacle to the delivery of this new training programme will be awareness and take-up. This can be overcome through the use of the ILO and UN networks to promote the offer.
Relevance to Portugal
This is a model of a programme that could be used to increase knowledge about the green economy and green entrepreneurship among those designing and delivery green entrepreneurship support schemes. The contents would need to be adapted to Portugal’s economic context, placing an emphasis on sectors such as renewable energy.
For further information
Website of ILO’s ITC Certification Programme for Green Business Trainers: https://www.itcilo.org/courses/certification-programme-green-business-trainers
Rationale and description of the initiative
Networking activities for green start-ups are currently informal and relatively unstructured. Many OECD countries are increasingly organising networking activities in a more structured and formal manner. The benefits are increased opportunities for identifying new clients, collaborators, investors and relevant research. Networking can also lead to informal learning opportunities.
The RNi - Portugal Incubators could work with individual incubators and accelerators that are specialised in supporting green start-ups to organise local and regional networking events on a regular basis. This would lead to the creation of a more formal network that could be used by start-ups and investors.
Expected results
The action would lead to more structured networking and collaborations among entrepreneurs and between entrepreneurs and researchers. This holds potential for increasing business to business transactions (B2B), including in the circular economy, as well as facilitating the commercialisation of research outputs.
Key performance/monitoring indicators
Performance and monitoring indicators for this initiative include:
Number of events organised.
Number of green start-ups participating.
Number of investors participating.
Number of incubators participating.
Number of researchers/research institutions participating.
Key authorities
The RNi - Portugal Incubators network would be well-placed to drive such an activity with support from individual incubators and research organisations.
International policy example: SET Hub, Germany
Description of the approach
The German Energy Agency (Deutsche Energie-Agentur GmbH – Dena) is the German centre of expertise for energy efficiency, renewable energy solutions and intelligent energy systems. Dena’s main goal is to promote start-ups in the energy sector and to help them network to drive the energy transition through sustainable, digital and technological solutions. It operates as a public company and has a number of functions, including implementing pilot projects, providing policy advice, supporting manufacturers and services providers, informing consumers, building networks across all sectors to support the energy transition and facilitates international exchanges and collaborations.
Dena operates about 100 ongoing projects, including the SET Hub. It offers a wide range of supports to start-ups, ranging from basic information about the energy system to individual start-up consultations to building connections between start-ups, established companies, infrastructure operators and policy makers. SET Hub covers issues such as digitisation, renewable energies, start-up funding, business models, legal framework, innovation, artificial intelligence and digitalisation.
SET Hub activities include SET Academies, SET Mentoring, SET Think Tank, SET Pilot Project and SET Network. The latter three bring together start-ups and research and corporate actors through competitions to identify challenges and solutions. The most promising receive partial or full fundings for trials during SET Pilot Project. The SET Network activity promotes exchanges between start-ups and established corporations in the energy industry. This is organised through regular events and managed by an advisory board.
Factors of success
Important milestones for the SET Hub include:
2024: 56 start-ups received individual consulting regarding their business models and challenges in SET Mentoring.
2024: The network was comprised of more than 450 start-ups and stakeholders and is complemented by the advisory board, which is made up of members from the energy industry and the start-up ecosystem.
2022: The SET Hub is part of the startup strategy adopted by the Federal Ministry for Economic Affairs and Climate Action in 2022 and, in this regard, makes an important contribution to promoting the startup environment in Germany.
The success of the intiative to date is due to support from the Federal Government, which is one of the main financial supporters and has also helped increase the profile of the agency. Other financial supporters include private foundations and other national governments including Canada, France, Switzerland and the United Kingdom.
A number of other factors also contribute to the success of SET Hub, including:
Ensuring that programmes and activities are visible, attractive and accessible to startups, including minimising wait times for applications and requests for information;
Identifying and building relationships with key stakeholders that can support start-ups in facing their challenges and taking advantages of emerging opportunities;
Connecting different intiaitives and actors to facilitate collaboration and exchange, notably between start-ups, large corporations and researchers;
Ensuring that there are early-stage programmes that activate capital for start-ups to support new ideas; and
Building instructure to support the scaling of start-ups, including building appropriate production facililties.
Obstacles and responses
One of the main obstacles Dena faces in its various activities is navigating the regulatory and legislative framework, which, as in many countries, is not always clearly defined. Therefore, Dena has always made strong efforts to connect all sectors so that they can work together and learn from each other. The SET Hub is an example of how it does this through a structured set of activities.
Relevance to Portugal
The example could serve as a model for Portugal, as it has demonstrated some successes, including bringing together public and private actors from different sectors.
For further information
Website of dena’s SET Hub: https://www.dena.de/en/projects/set-hub/
Rationale and description of the initiative
Green entrepreneurship support programmes and incubators can develop stronger international relationships, that could be leveraged to help entrepreneurs enter international markets. This is a missed opportunity for green entrepreneurs in support programmes and places Portugal at a competitive disadvantage, as this is an increasingly common practice across OECD countries.
The RNi - Portugal Incubators could allocate resources to building international relationships with incubators and other relevant actors. Their job would be to systematically identify incubators in other EU and OECD countries that are relevant partners for incubators in the network. They would aim to establish relationships with foreign incubators to help Portuguese green entrepreneurs make connections in foreign markets.
In addition, there are also likely to be learning opportunities for the Portuguese incubators. These could be established in a structured way such as seminars on specific issues, or through informal channels that follow the introductions.
Expected results
This could help up to 10-12 high potential green entrepreneurs enter international markets per year. There could also be opportunities for about 10-15 incubators to take advantage of learning opportunities.
Key performance/monitoring indicators
Performance and monitoring indicators for this initiative include:
Number of contacts per country established.
Number of entrepreneurs engaging with international contacts.
Value of business transactions established through international contacts.
Number of meetings between Portuguese incubators and foreign incubators.
Key authorities
Startup Portugal and the RNi - Portugal Incubators would be the main actors that could take on this coordinating role. An initial effort could be undertaken by the RNi and a scaled-up approach could be implemented by having a staff member from Startup Portugal perform this function for green start-ups in other support programmes.
International policy example: EcoLabs-COI, Singapore
Description of the approach
EcoLabs-COI were established by Enterprise Singapore, Nanyang Technological University (NTU) and the Sustainable Energy Association of Singapore (SEAS) in 2019. They are hosted and operated by NTU with funding from Enterprise Singapore, which is overseen by the Ministry of Trade and Industry. The initiative supports energy start-ups that are using cutting-edge innovations.
EcoLabs-COI offers start-ups with access to NTU laboratories and facilities for prototyping and testing, including the Renewable Energy Integration Demonstrator – Singapore (REIDS), which is its largest hybrid microgrid test bed and can be used to validate energy storage, renewable integration or microgrid solutions. Start-ups also have access to R&D experts and support to commercialise and scale up of their technologies, including business consultancy, market research, assessment of technology novelty and feasibility analysis. Some of these business development supports are provided by partners, and a small fee is charged for some of the services delivered by partners.
EcoLabs-COI has partnerships with more than 30 test beds in external organisations. These include shopping centres, educational institutions and manufacturing sites. The support services initially focussed on electrification, energy efficiency and digitalisation, but have since expanded to include urban mobility; renewable integration; smart grids; carbon capture, utilisation and storage; and the circular economy.
One of the principal services offered by EcoLabs-COI is to support start-ups entering foreign markets. It has strong relationships with governments and companies in Germany, India, Israel, Korea, Norway, Chinese Taipei, the United Kingdom and the United States to help identify potential customers in these countries and meet foreign regulations. In addition, it works with Canada (High Commission), India, Korea (Korea Trade-Investment Promotion Agency, KOTRA) and New Zealand (Ara Ake) to offer public-supported start-ups from those countries to receive on-the-ground incubation support in Singapore.
Other kinds of support offered include monthly pitch sessions with private investors and support start-ups with applications for grant funding. EcoLabs-COI also supports the PowerACE EcoLabs-COI Special Award, which awards a cash prize of SGD 100 000 (approximately EUR 64 800) and one year of support services and access to infrastructure. Winners are promoted at events and in the media.
The call for applications is permanently open. Start-ups from around the world can apply, provided they can demonstrate value for Singapore.
Factors of success
In three years, EcoLabs-COI has supported over 35 start-ups and SMEs in clean energy technology, a sector in which Singapore has not traditionally been a major player. While the facilities and equipment have enabled the initiative to be successful, the keys to success have been the facilitation of international relationships for participants. This helped them leverage the government’s brand to create new business opportunities abroad.
Other important elements of the initiative were the attention paid to business development services, including human resource management to help the start-ups identify and secure new talent.
In addition, supported start-ups noted that the availability of energy-specific calls was useful because energy technology start-ups have long lead times and large funding requirements for energy hardware.
Obstacles and responses
The initiative was established prioritising the targeting of some technological areas (i.e. electrification, energy efficiency and digitalisation). However, these technologies were not well-aligned with global markets such as carbon capture, utilisation and storage (CCUS) and hydrogen that experienced rapid growth. This hindered Singapore’s entry into these markets. These technologies have since been included into EcoLabs-COI’s portfolio.
Relevance to Portugal
This initiative can serve as a model initiative that provides comprehensive support services to new energy start-ups, including a strong focus on building international connections and entering foreign markets. With such a strong emphasis on networks, the initiative was successful in creating an ecosystem for clean energy technology innovation in Singapore that previously did not exist.
For further information
Website EcoLabs-COI: https://ecolabs.sg