“Yes it’s true, we ranks 46th in terms of firm entry rate,” he said yesterday at the WMC event. “However, the one that’s scarcely mentioned is that Wisconsin is second in the country in terms of survival rate.”
And Koskinen says the Census Bureau confirms that Wisconsin has the second best exit rate for startups.
“We’re more likely to survive,” he said.
To illustrate his point, Koskinen provided an example with two entrepreneurs: Fred and Ginger. If Fred fails his first two times starting a business but succeeds the third time, Koskinen argues the concrete outcome is no different than in Ginger’s case, where she gets it right the first time.
“It doesn’t matter what the startup rate is, it matters what you need to get done in terms of actual performing work on a continuing basis,” he said. “Invariably, if you have a high startup rate, you also have high failure rates. It’s not indicative of the state of entrepreneurship at all.”
He says the last-place ranking also ignores second-stage companies, which have surpassed startup status, have more than 10 employees and are still expanding.
“Our employment growth actually ranks eighth in the country in that group,” he added.