Fact 3. There is a substantial fraction of people who become entrepreneurs ‘‘out of necessity’’, and not to pursue an
opportunity.
This results from data collected through the Global Entrepreneurship Monitor (GEM) project in 47 industrialized and
developing countries. Table 2 shows the fraction of people responding to ‘‘Are you involved in this start-up to take
advantage of a business opportunity or because you have no better choices for work?’’ as ‘‘have no better choice’’. (For
more details on the source, see the notes to the table.) Firms run by these ‘‘necessity entrepreneurs’’ are smaller, and their
owners expect them to grow less than other firms (Poschke, 2013).6
What stands out is that there is a substantial fraction of entrepreneurs ‘‘out of necessity’’ everywhere, even in
industrialized countries. In most countries, the number is above 10%. The average for industrialized countries is 14.4%, and
it is much higher in poorer countries. Hence, not all entrepreneurs are out to innovate or pursue a golden opportunity.