The Emerging Innovation Ecosystems and "Valley of Death": Towards the Combination of Entrepreneurial and Institutional Approaches

This paper provides the discussion regarding the nature, origins and diversity of innovation ecosystems with particular emphasis on the context of the emerging economies and "smart specialisation" paradigm of regional development. Bridging the gap between the research economy and commercial economy ("Valley of Death") remains one of the key concerns of the mature and institutionalised innovation ecosystems. However, many of the emerging innovation ecosystems still suffer from underdeveloped institutional frameworks and fragmented ties of actors, which is a more pronounced challenge than "Valley of Death". It is important to take into consideration the specific needs of different innovation ecosystems in the context of the current EU innovation and regional policies (recently synergised under "smart specialization"). The development of sustainable innovation ecosystem requires a different mentality than the traditional institutional-regulatory approach adopted in the context of national innovation systems. It means the search for delicate balance between the supply-side and demand-side interventions, public and private, openness and ownership, long-term and short-term perspectives, quality of elements and their relationships, adequate policy actions and smooth functioning of the "invisible hand". The emerging innovation ecosystems need to complement their entrepreneurial profiles with stronger institutional frameworks and innovation support mechanisms, whereas the mature institutionalised innovation ecosystems should not over-rely on institutional, supply-side solutions, but strengthen the entrepreneurial culture that is even more critical to innovation success.