Institutional logics and Entrepreneurship in
the French space sector
How do institutional logics affect identification, evaluation and
exploitation of opportunities in the French space industry?
Master’s Thesis by H. A. Hruska
Name: Hugo Hruska
Student number: UvA: 11846275 E-mail: hugohska@gmail.com Date: August 16, 2018
Supervisor: Dr. Elco Van Burg
University: University of Amsterdam · VU University Amsterdam Faculty: Economics and Business Administration
Preface 2 Abstract 4 Introduction 5 Research Question 8 Relevance 9 Literature review 9
Opportunity identification, evaluation and exploitation 9
Factors affecting the opportunity identification, evaluation and exploitation process 12
Personality traits 13
Prior Knowledge 14
Social Network 16
Opportunity exploitation in high tech industries 16
Institutional theory 19
How Formal institutions shape entrepreneurship 23
Background information of the French space industry 26
A new commercial space era 26
History of the french space sector 27
Position of the French space industry in the space sector 29
The French space industry and stakeholders 30
Entrepreneurial ecosystem in French space sector 31
Adapting to a new environment 33
Cosmicapital 33 Act in Space 34 Connect by CNES 34 Space’ibles 35 Methodology 35 Research design 35 Sampling 37 Data collection 39 Data analysis 39 Findings 40
Factors affecting entrepreneurial alertness 40
Prior knowledge and personal reasons 40
Frustration faced in large organisations 43
Support by institutions 45 Fostering entrepreneurship inside and outside of the agency the agency 47
Factors affecting opportunity exploitation 48
Team 49
Entrepreneurial skills 50
Network effects on opportunity exploitation 52
Barriers to entrepreneurship in the French space sector 54
Closed sector 54
Scientist transitioning to entrepreneurs 56
Disadvantageous bureaucracy 59
French mindset and risk adversity 63
Discussion and conclusions 65
Change in culture and favourable conditions for entrepreneurship 65
Prior knowledge, personality and entrepreneurial skills 70
Effects of a closed clustered sector on entrepreneurship 73
Theoretical implications and conclusion 77
Managerial implications and recommendations for policy makers 81
Limitations and further research 83
Bibliography 85
Appendix 93
Appendix 1- Codebook 93
Appendix 2 - Interview protocol 101
Appendix 3 - Interview protocol for CNES officials 104
Appendix 4 - Key Processes in innovation systems 107
Preface
This study was performed as a master’s thesis for the joint master’s program of entrepreneurship in Amsterdam. The thesis supervisor guided the process of the research, and provided support as well as recommendations regarding the format and content of the thesis. This document is written by Hugo Alexandre Hruska, who declares to take full responsibility for the contents of this document. The text and the work presented in this document are original, and no sources other than those mentioned in the text and its bibliography have been used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, however not for its’ content
Abstract
This paper is an inductive research into effects of institutional logics on the early stages of the entrepreneurial process which have been outlined by academia as opportunity recognition, evaluation and exploitation. The study was performed adopting a qualitative approach using semi structured interviews as primary form of data collection with a mixed sample of 4 entrepreneurs in the space industry and 3 representatives of CNES. Thus the study discovered that institutional logics not only shape interactions and behavior between people as was outlined by Bruton, Ahlstrom and Li (2010) but also has significant impact on individual thinking and individual interpretation of information which have been identified as key antecedents of opportunity recognition and therefore comply with the frameworks by (Ardichvili et al.’s, 2003). Finally the research further emphasizes the role of normative perception of entrepreneurship and culture as a whole, in predicting a country’s propensity to enterprise. Moreover the study also sheds light on several mechanisms that triggers change towards a more pro-entrepreneurial culture. In addition to key theoretical discoveries, the paper also provided deeper insights into the current state and dynamics of the french space sector, and how it’s main agency CNES has adapted in response to the changing space environment
Introduction
For a long time the final frontier of space has been perceived a key strategic for space exploration, science and security applications. However recent years has seen the space environment no longer be the sole preserve of government and institutional agencies with an increasing trend of private and public actors getting involved in space activities. The space sector is seeing significant shifts with an increasing level of competition. The launch service market has risen steadily with new entrants coming from the US private sector, but also from japan, China, India and Russia (OECD, 2012). Competition is also ramping up in the satellite market, as new players either aim to acquire large satellites or make use of their abilities. This has sparked the development of the space economy that can be defined as all commercial activities that have been derived from space enabled products and services. It encompasses all public and private actors of long value- added chain involved in developing and providing space-enabled products and services which starts with research and development actors and manufacturers of space hardware and ending with the providers of space-enabled products and services to final users (OECD, 2012). Several mature downstream activities have since reached mass markets and including key services to the functioning modern societies such as the use of satellite technology in navigation, communications, meteorology and earth observation. This has led to a rise of a growing stream of commercial applications in various industries such as traffic control, transport, natural resource management, agriculture, environmental and climate change monitoring, entertainment and so on, which in turn are creating new downstream uses and new markets (OECD, 2012). As a result this new movement has been coined “Space 4.0” (ESA, 2018) and can be defined as the commercial era of the space sector, characterised by the interaction between government, private sector, society and politics.
European space agencies have acknowledged these changes and are pressured to adapt to the changing environment by providing the necessary infrastructure to the development of the European space sector. Thus the European Space Agency is a key player in coordinating these
efforts by shaping it´s space capability and ensuring financial and intellectual resources to its members (Al-Rodhan, 2012). ESA's purpose is to support, develop and promote, for exclusively peaceful purposes, cooperation among European States in space research and technology.. It elaborates and implements long term European policies and coordinates the national efforts of its members. ESA today has 22 member states with its leading contributors being France and Germany, represented by their respective agencies CNES and DLR.
Hence the Centre national d'études spatiales (CNES) (National Centre for Space Studies) is the French government space agency and plays a key role in the French, European and international space arena, driving initiatives, stimulating new proposals and policies and providing technical expertise to support the design, development and operation of space systems. CNES guarantees Europe’s independent access to space and helps prepare new-generation space systems and develop international cooperation (CNES, 2015). In addition of managing Europe's spaceport alongside the ESA at the Guiana Space center, the French space sector is also responsible for the Arianne programme, the world’s first commercial launch service provider. CNES is constantly shaping the French space sector by partnering with several commercial enterprises, giving government support to strategic activities.
Although both institutions promote and support the development of innovation and the space economy, ESA observes that there is relatively little ‘independent’ entrepreneurship in the European space sector and that the innovation potential of the space sector is not fully exploited. The European space sector is a highly regulated and resource intensive industry, which makes it hard for entrepreneurial activities and emerging innovations and to become successful. Whilst established big players continue to thrive, the innovative capacity and societal spill-over of the institutional/governmental space sector remains slow. It is therefore imperative to better understand the factors driving and constraining the development of entrepreneurship in the field and explore how the institutional environment affects entrepreneurial intentions.
This paper will particular focus on opportunity recognition and exploitation process as it reflects A fundamental element in entrepreneurship and marks the trajectory of a startup. Literature has defined the entrepreneurial process as identification, evaluation and exploitation of opportunities (Eckhardt and Shane 2003). Therefore opportunity recognition and exploitation have been widely recognised as foundational elements of the entrepreneurial intention. Not only is it a crucial initial step in the entrepreneurial process (Ozgen and Baron 2007) but also in the key element in the development of new innovations. Identification of opportunities has been found to be significantly linked to one’s prior knowledge and experience in particular areas (Shane, 2000). Furthermore, conceptual models of entrepreneurial opportunity development assume that the process proceeds through several stages including conceptualization, objectification, assessment and enactment of an opportunity into a venture (Wood and McKinley, 2010) and that people with an entrepreneurial cognition orientation are more likely to spot them (Alvarez and Busenitz, 2001). However little research has investigated how the process is affected by the institutional environment (Phillips and Tracey, 2007)
The institutional environment has been identified as key factor in influencing entrepreneurial intentions. Díaz-Casero et. al., (2012) argues that it heavily affects perception of feasibility, attitude and beliefs about engaging in entrepreneurship. Institutional theory argues that actions of organizations and individuals within them are shaped by what is perceived proper, rational and necessary (Tolbert, David, and Sine, 2011). Thus institutions are the taken for granted rules (through regulations or socially constructed) that structure the dynamics and practices within a field through logics (Kalantaridis and Fletcher, 2012). These logics are relatively resistant to change as they are normatively endorsed and backed up by authoritative powers (Thornton et al., 2012). They shape individual´s cognition and preferences (Pahnke et al., 2015), underpins the aim and values of an organization and shapes how it operates internally and interact externally (Thornton, Ocasio, & Lounsbury, 2012). Thus institutions control and constraint behaviour by defining legal, moral and cultural boundaries by setting off legitimate from illegitimate practices. Although much research examines how institutions influences how new firms get started (Hiatt, Sine, and Tolbert, 2009) and are organized ( Powell and Sandholtz, 2012), little
research has examined how institutional logics affects identification of opportunities. Innovation literature has shown that, especially in high tech industries, successful ventures based on new innovations require for the institutional environment to evolve and with it, substitute establish practices ( Kooijman et al., 2017). Thus Kooijman et al. (2017) has shown that formalization of established practices hampers the innovation process towards which in consequence hampers the ability to build new ventures built on subsequent identified opportunities. Nevertheless the literature pays little attention how the persistence of established practices and underlying rules can impact the identification and exploitation of new opportunities.
Research Question
Therefore the aim of this project is to address these gaps by examining how the institutional pressures in the space sector (mainly from CNES) enables and constrains the entrepreneurial imagination and action of existing companies and new entrepreneurs. The research question guiding this paper will consequently be: “How do the logics/rules/practices in the space sector enable and constrain entrepreneurial imagination, intention and action (of existing companies and new entrepreneurs)?” Drawing on institutional theory, the research will examine how the institutional logics (norms, structures and practices) and the persistence of established practices influences key stages in the entrepreneurial process such as opportunity recognition and opportunity exploitation. An institutional logics perspective is crucial here as it provides a way to examine how the cultural context might influence the process and the subsequent actions people are expected to take (Bareto, 2011). This enables to have a better understanding why some people rationalize some opportunities as worth pursuing and thus engage in entrepreneurial ventures (Greenman, 2013). This paper will mainly focus on the French entrepreneurial environment in space related activities in order to provide more significant and contextual results and provide data for ongoing international investigations by the ESA on similar topics. As this research is an inductive investigation in the field of entrepreneurial intentions in the space sector, several key stakeholders in the French Space sector were interviewed including entrepreneurs, and CNES representatives. The findings aim at providing qualitative data for a better understanding of the factors driving entrepreneurial intentions in a high-tech industry such as the
space sector. This paper will thus contribute to the academic discussion around entrepreneurship and institutional theory by closely analyzing the dynamic relation between the two. As this paper presents an investigative study in the topic, a thorough literature review was first performed to provide an overview of current academic perspectives.
Relevance
This paper hence aspires at analyzing how the current institutional environment and its established practices influences the opportunity recognition process and the rate of innovation in such a high tech industry. Considering the pivotal role the space industry has been in providing key services that are fundamental to modern living and its tremendous contribution to national economies (CNES, 2015), gaining a better understanding of the opportunity recognition process has obvious benefits. Firstly, it can help government bodies develop and refine appropriate policies and support programmes to foster entrepreneurial ambitions in the sector. Secondly from a organizational standpoint, it can aid current dominant players to improve their abilities by nurturing the elements crucial in identifying new innovations. Furthermore this paper also aims at contributing to the entrepreneurship literature, by delivering more evidence in regards to the debate as to why certain individuals that have identified opportunities decide to pursue it and engage in the entrepreneurial process. Lastly this paper also aims at synthesising the existing literature in opportunity recognition theory into a more complete and inclusive perspective, with specific reference to the space sector.
Literature review
1. Opportunity identification, evaluation and exploitation
Entrepreneurship refers to an individual’s ability to turn ideas into action. It is defined by the ability to identify a good idea and transform it into a business concept that adds value and generates revenues (Lumpkin and Lichtenstein, 2005) and thus comprises creativity, innovation and taking risks, as well as the ability to plan and manage projects in order to achieve objectives (Liñán et al., 2014). Consequently opportunity recognition is central to entrepreneurship as it is
the ability to identify a good idea and transform it into a business concept that adds value and generates revenues (Lumpkin and Lichtenstein, 2005)
As a crucial initial step in the entrepreneurial process, opportunity recognition is a foundational element in the development of new ventures (Ozgen and Baron 2007) and a defining feature of the field of entrepreneurship (Shane and Venkataraman, 2000). Ardichvili et al. (2003) suggests that identifying and selecting the right opportunities for new businesses are among the most important abilities of a successful entrepreneur making it central to entrepreneurship research. Shane and Venkataraman (2000) even argue that the discovery and evaluation of opportunities should be the fundamental focus of scholarly activity in entrepreneurship research. Moreover Shaver and Scott (1992) further emphasize the importance of the emerging field as they argue that “we need to better understand the behaviour and thought processes that enable entrepreneurs to see the unique potential in a situation and create an organisation to pursue it, whilst other individuals, when presented with the same information, either fail to see the opportunity or choose not to pursue it.”
Bygrave and Hofer (1992) first introduced opportunity recognition as a topic in itself as part of the entrepreneurial process and has since sparked numerous research engaging in the topic. Shane & Venkataraman (2000) describe entrepreneurial opportunities as “those situations in which new goods, services, raw materials, and organizing methods can be introduced and sold at greater than their costs of production". Thus opportunities involve a process of identification and exploitation of opportunities by an individual based on its economical value. They begin as simple concepts that become more elaborate as the entrepreneurs develop them ( Ardichvili et al., 2003). Thus creation of a new venture and development of new innovations (Gielnik et al., 2012) require a proactive cognitive process from the entrepreneur (Pavia, 1991).
Several authors have attempted to illustrate the opportunity recognition process by suggesting frameworks built on the idea of discovery and evaluation ( Lumpkin, Hills, & Shrader, 2004). Certain research in the field has adopted a cognitive perspective and suggesting that this process
is enabled through a distinctive cognitive process ranging from conceptualization, objectification, assessment and enactment of an idea (Wood and McKinley, 2010). This that opportunity recognition is not limited to a singular identification moment but is a multiphased process where an idea is elaborated using new information and additional knowledge created over time (Lumpkin and Lichtenstein, 2005). The author of the idea needs to transform the idea into an opportunity that adds value (Petti, 2009) and create an organization to pursue it (Bygrave and Hofer, 1992) in order to turn it in an entrepreneurial venture. Thus a common trend in the literature indicates that the evaluation process is the decisive stage at which an individual decides to pursue the idea or not. As this stage indicates possible intention to engage in entrepreneurial activity to exploit the identified opportunity, several comparisons can be drawn to Ajzen and Fishbein's theory of planned behaviour, or more specifically its application on entrepreneurial intentions by Kruger and Carsrud ( 1993). They note that in addition to intrinsic factors such as perceived behavioural control, which can be defined as one’s perceived ability to successfully engage with the task, and perceived attractiveness of the resulting situation following the behaviour, they also add that exogenous elements such as perceived social norms to also be a an indicative factors in predicting entrepreneurial behaviour (Kruger and Carsrud, 1993)
By focusing on a creativity based model Lumpkin, Hills & Shrader, (2004) were able to capture the emergent nature of entrepreneurship that requires a lengthy cognitive process that entrepreneurs have to engage in when drafting new business concepts (Sarasvathy, 2001). Although the model suggested by Lumpkin, Hills, & Shrader, 2004 enables to describe the individual creative process and manages to effectively capture the opportunity identification, evaluation and exploitation process , it does not effectively account for external forces that could influence the different stages. Several papers have indicated that the cultural context can influence the elements forming entrepreneurial intentions (Hopp and Stefan, 2012) and generally affect the cognitive processes that result in the development of ventures (Pahnke et al., 2015), and it is thus crucial to gain a better understanding of them.
Factors affecting the opportunity identification, evaluation and
exploitation process
Academia has widely attempted to uncover the factors that lead to the identification of opportunities. One of the most widely recognised papers in the field by Ardichvili et al. (2003) argues that the most important factors that influence the recognition and exploitation of opportunities are the entrepreneur’s alertness, asymmetrical information and prior knowledge, social networks, the personality traits of the entrepreneur and the nature of the opportunity itself as shown in figure 1.
Figure 1 Ardichvilli et al.’s (2003) model for opportunity identification and development theory
Scholars have argued that any recognition of opportunity by prospective entrepreneurs is preceded by a heightened alertness to information ( Gaglio and Winter, 2009). They termed the state entrepreneurial awareness and defined it as one’s propensity to notice and be sensitive to information about objects (Ardichvili et al.’s, 2003). As a result, Ardichvili et al.’s (2003) framework puts the entrepreneur’s alertness as central factor for successful identification of
opportunities suggesting that a higher level of alertness increases the likelihood of opportunities being recognized. Several authors claim that personality characteristics and the environment interact to create conditions that foster higher entrepreneurial alertness. ( Gaglio and Katz, 2009). As a result, Ardichvili et al.’s (2003) framework suggest that entrepreneurial alertness is the culmination of personality traits and prior knowledge in addition to the exchanges within one’s social network.
Personality traits
Much of the early literature in entrepreneurship has had a predominant focussed on personality traits to explain why certain individuals are more likely to engage in entrepreneurship. A substantial amount of research has therefore examined the role of personality in entrepreneurial ambitions and have identified a variety of personality variables. Many factors were thus identified such need for achievement ( McClelland, 1961), locus of control (Rotter, 1966) and conceptualised such as the five-factor model of personality by McCrae & John (1992). This includes namely high Extraversion and Openness; low Neuroticism, Agreeableness, and Conscientiousness. Moreover several authors have prompted risk propensity to be recognized as a sixth dimension of personality (Paunonen & Jackson, 1996), however others suggest reflects a specific combination of all five basic personality factors (Soane, and William, 2005). Thus several academics have linked one’s sense of risk adversity to one’s confidence in their abilities. As a result the concept of self efficacy has attracted much academic interest as it plays a foundational role in the development of entrepreneurial intentions (Boyd and Vozikis 1994) and is widely considered best predictor of eventual entrepreneurial behaviour (Krueger et al., 2000). The concept suggests that entrepreneurs will act on identified opportunities depending on the level of confidence they have in their abilities to successfully exploit them . The paper by Chen et al. (1998) advocates that entrepreneurs require some form of self efficacy five key areas in order to successfully engage in the entrepreneurial process : marketing, innovation, management, risk-taking and nancial control. Although these skills can be developed through time, several authors have emphasized the importance of business education and commercial knowledge (Vesper, 1996) (Bygrave, 1997) in successful venture creation.
This is a particularly important element to consider for space entrepreneurship, as any ambitions in the sector are associated with high risk and high uncertainty due to the colossal funding and support it will require. Thus entrepreneurs in the field require a lot of confidence in their abilities when deciding to independently set out and engage with the industry. Consequently new entrants not only require to have confidence in the entrepreneurial abilities to start a company from 0 , but also in their technical abilities as space is known to deal with highly complex concepts and technologies. While scientific minded people excel at developing inventions, it is rare to also be commercially orientated and be able successful business model around it. This is particularly relevant in university and institutional settings where new technologies are being released do not yet have commercial purposes. Considering this paper examines the space industry, it is important to investigate the factors affecting opportunity identification in exploitation in industries that heavily requires scientific knowledge.
Prior Knowledge
Similarly to previous literature, Ardichvili et al (2003) stretches the importance of previous knowledge in the ability to identify opportunities. The authors suggest that the interpretation of new information will be influenced by prior knowledge and experiences (Von Hippel, 1994). As a result academics posit the discovery of new opportunities exists due to information asymmetries between different actors, suggesting that entrepreneurs perceive the value in opportunities due to their prior knowledge and experiences. Moreover several academics have also highlighted the importance of the entrepreneur’s creativity and unique cognitive setting in order to be able connect certain dots and transform ideas into business concepts. (Baron, 2006) This perspectives allows for a better understanding of why certain individuals when presented with the same information are not able to identify the same opportunities as they do not possess the same set of prior knowledge (Baron, 2006). In their model Ardichvili et al. (2003) also imply that there are two type of knowledge relevant to this identification process. While the first type deals with all personal and special interests of an entrepreneur (leisure time interests), the second one describes the skills and knowledge accumulated over time while working at a job in a certain
industry. It is through the combination of both that individuals can identify unique new opportunities, approaches, markets or new solutions. Thus it can be argued that industries that attract professionals from multiple disciplines are more likely to thrive as more opportunities tend to be identified. Although some authors indicated the need for multidisciplinary collaboration for successful venture creation, little to no research has investigated the effects of interdisciplinarity on the opportunity recognition process and emerging high tech industries.
Moreover managerial knowledge is fundamental to locate, mobilise, combine and exploit other resources in response to business opportunities (Granstrand, 1998), especially in high technology based firms (Park, 2005). This may also offer an explanation why actual inventors of new technologies ( scientist and engineers) fail to engage in entrepreneurial ventures by themselves (Oakey, 2003) as they find to encounter a knowledge based barrier and therefore reach out to entrepreneurial partners already equipped with the necessary skills. Hence academia has highlighted the necessity for teams with a broad range of skills with both, managerial and technical competencies for successful opportunity recognition and subsequent creation and growth of a high tech firms (Park, 2005). Though the models reviewed in this literature review highlighted the importance of prior knowledge, it did not effectively account for commercial knowledge. However according to several authors it appears to affect every stage stage of the opportunity recognition, evaluation and exploitation process and that individuals with have a high level business education and commercial experience are more prone to successfully identify and exploit opportunities (Park, 2005). Thus scientist that do demonstrate a higher level of business knowledge and a proactive entrepreneurial personality are more likely to contribute to the successful development of new innovations as they also have the abilities to turn them from a concept to reality (Kickul and Gundry, 2002). This strongly indicates that people with an expertise in a specific field combined with managerial and business knowledge are most prone to successfully identify and exploit unique opportunities.
Social Network
Finally one’s social network represent a crucial role in opportunity recognition, evaluation and exploitation. Firstly they present a key element in the evaluation phase of an identified idea or opportunity as they can aid in validating, further develop an idea and potentially provide resources and some initial financial help. In addition, several authors have highlighted the importance of one’s social environment as a source of new information. Granovetter’s (1983) argues that weak ties are especially relevant as they provide an information source outside of an individual’s strong tie network. As a result they are more likely to provide new information that one’s close social group would not have been able to access. Several studies have reinforced this perspective asserting that entrepreneurs who have extended networks identify significantly more opportunities and even suggested that the quality of network contacts can affect other characteristics, such as alertness and creativity (Ardichvilli et al., 2003)
Thus network were shown particularly to be important in the case of high technology firms. In their study Elfring & Hulsink (2003) have shown that strong tie benefits are associated with social co-optation and cost savings on resource acquisitions which is very beneficial to early start ups. Moreover strong ties are also an important asset in gaining legitimacy because they enable start-ups to associate themselves with other people or institutions with good reputations. This provides them with the a certain level of credentials facilitating their entry to market and access to funding. Lastly Uzzi (1997) has also illustrated the role and importance of embedded ties that can help entrepreneurs overcome challenges. Thus embedded ties allow for joint problem-solving arrangements, where different actors can can coordinate their functions to work out problems in a collaborative way. These arrangements typically consist of routines of negotiation and mutual adjustment.
Opportunity exploitation in high tech industries
As this paper investigates the institutional factors affecting the entrepreneurial process in the space industry, it is only necessary to delve into the literature regarding entrepreneurship in high
tech industries. Activities in the sector often rely on cutting edge technology that initiate the development of several new downstream markets and require entrepreneurs with specific abilities. Opportunity recognition is a crucial skill when it comes to the field of technology. While scientific institutions such as universities and some large organisations are focussed on generating new technologies, several lack commercial purposes or are not fully exploited due to a narrow focus and organisational prescriptions (Goethner et al., 2012).
Thus external entrepreneurs and startups play a major role in product innovations by transforming low-value’ technology from one business sector to another where it becomes ‘high-value’ (Christensen, 1997). Moreover new technologies by nature can have a multiplicity of applications in various fields. Hence entrepreneurs also play a crucial role in identifying possible applications and implement their use in other areas and industries. Thus the enterprise of technology transfer is a central activity to innovate practices in other sectors and convey the benefits of the technology to new actors (Debackere and Veugelers, 2005). The significance of external entrepreneurs is further highlighted by Christensen (1997) that investigated why some smaller companies are able to exploit opportunities that large corporations either fail to see or decide not to pursue. He concluded that it is a combination of organisational knowledge , culture and common practices in large firms that can negatively impact their ability to recognise the future value of emerging technologies and markets. Large organizations are inherently very bureaucratic and thus slower in their ability to respond to a changing environment. As a result many new technologies are readily available waiting for entrepreneurs and organisations to identify opportunities and applications. This can take the form of licensing proprietary technologies to actors who have recognized potential value in new markets or through technology acquisition (Park, 2005), which tends to generally be only available to large organizations with significant resources.
Although Christensen (1997) provides a partial explanation why certain organisations fail to identify or pursue opportunities due to their organisational complexities, it does not consider this process from a multidisciplinary perspective. Academia has shown that innovations and new
technologies are often the result of combined efforts by scientists and other researchers from a variety of professional backgrounds (Parks, 2005). Though some authors emphasized the importance of multidisciplinary teams to be particularly critical in the highly changing nature of high tech domains (Ozgen and Minsky, 2006) little to no research has investigated how the opportunity recognition process is affected when actors from completely different disciplines are exposed to and attempt to actively search for opportunities in an industry previously unbeknown to them. Considering prior knowledge and expertise is a widely considered an underlying factor in the opportunity recognition process (Shane, 200) and that asymmetry of information is assumed to be a dominant explanation of why some people are able to perceive opportunities, it can be theorized that industries, especially in high tech sectors, that attract the interest of individuals from variety of discipline will lead to more opportunities being recognized. However, although more opportunities might emerge, the individuals who have identified them may still fail to pursue them due to environmental conditions or a lack of abilities in exploiting them (Park, 2005)
Thus the entrepreneurial endeavours in the space sector require specific competencies from entrepreneurs in order to successfully thrive and survive in the industry. In their book analysing the space policy developments they noticed that space entrepreneurs tend offer several important capabilities and advantages which can be difficult to create and sustain in larger aerospace corporate cultures such as an “ ability to build fast-moving and efficient teams and organizations geared around a core mission and competency; the capacity for innovative “out-of-the box” thinking with the potential to generate substantial cost reductions over traditional space industry approaches ; a culture and financial structure which accepts higher levels of technical and market risk.” (Schrogl et al., 2006 p. 268). Thus entrepreneurs and startups are key components to the successful development of an industry and spark innovations as organizations are restricted by corporate and institutional practices. This explains why high tech start ups are seen by many governmental institutions as having a pivotal role to play in the regeneration and growth of national economies (OECD, 2003).
However individual behaviour changes and adapts over time as one gains experiences and knowledge through interactions with the world around them (Parks, 2004). Each entrepreneurial venture is unique, marked by the cultural and institutional context and unique interactions experienced by the entrepreneur This resulted in much of the early literature being criticised for focussing entirely on the entrepreneurs traits and personality. Thus Gartner (1985) identied the external environment as being a key inuencing factor in the entrepreneurial process suggesting that venture formation is founded on dynamic interactions. This is particularly relevant in opportunity recognition research as Moore (1997) has indicated that both individual personality and external environmental factors can influence each of the cognitive stages involved in the initial phase of the entrepreneurial process.
Much research has shown that environmental factors significantly affect the entrepreneurial process, leading to differences in the rates of new firm formation, survival, and growth across industries ( Kirchhoff, 1994). Although the environment represents a crucial influential factor by several authors, popular literature in opportunity recognition does not effectively account for it. Whilst Lumpkin et al. ‘s (2004) model purely focused on the individual cognitive process, Ardichvili et al (2003) only includes one’s network as environmental element that allows for opportunity recognition, both do not effectively account for external forces. As a result it is crucial to analyze these processes using an inclusive perspective that accounts for the environmental and cultural context the it situated in. An institutional perspective therefore presents the most benefits as it defines a society’s social structures through regulative, normative and cultural-cognitive dimensions. This is particularly relevant as Díaz-Casero et. al., (2012 ) argues that it heavily affects perception of feasibility, attitude and beliefs about engaging in entrepreneurship which are driving elements of entrepreneurial intention ( Ajzen, 1991).
Institutional theory
Institutional theory is a popular academic topic suggesting that institutions drive the behavior of organizations and individuals (Scott, 2014). North (1990) has described the institutional environment as a set of political, social, and legal ground rules that fixes a basis for production,
exchange, and distribution in a system or society. Although the definition of institutional logics vary among scholars it can be resumed by the idea of that behaviour occurs within a socially constructed and socially embedded rules of appropriate behaviour. These rules can either be defined by formal institutions (e.g. policies, regulations and/or treaties) or by informal institutions (socially constructed through customs and behaviour patterns), and shape the interactions, relationships and behaviour of actors. As a result, institutions do not only generate rules as a set of commands, but rather structures roles and practices that are being established and are not easily dissolved (Kemp et al., 1998). Moreover, institutions regulate the behavior of both firms and individuals in an institutional setting, and provide an environment in which they can operate (Abdesselam et al. 2017).
Thus institutional logics perspective is built upon a multi-level theoretical model that explains the relationship between macro-level constructs (e.g., institutional logics and organizational practices) and micro-level constructs (e.g., individual actions and social interaction) (Thornton et al., 2012). It has become a popular lens to understand individual and organizational actions within a social context that frames their behaviour, as institutional logics forge belief systems and related practices in a specific organizational field (Scott, 2014) . It enables to analyze organizational activities and how internal and external forces affects their perception and actions (Tolbert, David and Sine, 2011). Institutional theory has been widely used among academics as theoretical foundation for exploring a wide variety of topics ranging from institutional economics, political science and organization theory (DiMaggio & Powell, 1991).
Research in entrepreneurship has also increasingly benefited from an institutional lens as it represents a crucial element in explaining the forces that shape entrepreneurial success. Authors have suggested that the institutional environment defines, creates and limits entrepreneurial opportunities, and thus affects entrepreneurial activity rates (Thornton et al. 2011; Alvarez and Urbano 2012). To the field of entrepreneurship, institutions represent the set of rules that articulates and organises the economic, social and political interactions between individuals and
social groups. Institutional factors such as national culture (Mueller and Thomas, 2000) and government regulation (Ho and Wong, 2007) can promote or deter entrepreneurship in a society.
The theory assumes that individuals will draw upon institutional logics to understand what has worked in the past, seems to be working in the present and what should work in the future (Thornton et al. 2011). These assumptions inform individuals on how to reduce uncertainty (McMullen and Shepherd 2006); develop commitment to entrepreneurial projects and evaluate the consequences of such actions (Casson and Wadeson 2007). As a result, institutional logics perspective allows to understand why some people rationalize if opportunities as worth pursuing; what the purpose is to engage in entrepreneurship and what incentives, both material and otherwise (e.g. status and legacy), lead individuals to engage in entrepreneurial projects (Bruton, Ahlstrom and Li, 2010).
Based on three institutional dimensions outlined by Scott (2014), Busenitz et al. (2000) introduced the concept of a country’s institutional profile for entrepreneurship. The proposed framework aimed at showing how the regulative (government policies and regulations), normative (social norms and value systems) and cultural-cognitive (shared social knowledge) pillars inuence domestic business activity. The instrument has since been used by several academics to measure and compare the institutional profile of different countries (Manolova et al. 2008). As a result, authors have attempted to examine the influence of institutional dimensions (regulative, normative and cultural-cognitive) on the probability of becoming an entrepreneur (Urbano and Alvarez, 2014) in various countries.
Gnywali and Fogel (1994) also identified a series of environmental dimensions that are important from the point of view of entrepreneurship such as : government policies and procedures; socioeconomic conditions; entrepreneurial and business skills; financial and non-financial assistance. Firstly government policies should aim at ensuring market mechanisms work efficiently by providing a legal ground for companies to assume reasonable risks in the running of their business and to eliminate possible administrative rigidities. Entrepreneurship
policy aims to enhance entrepreneurial vitality by motivating and equipping entrepreneurs with the necessary skills and a supportive environment for businesses to start, thrive and survive (Liñán et al., 2014).
Socioeconomic conditions being the second dimension, includes attitudes of society and governments toward entrepreneurial activities as it relies on a positive appreciation of entrepreneurs in society (Liñán et al., 2014). Thus Bruton, Ahlstrom and Li (2010) point out that informal institutions of norms present within a society defines and determines models of behaviour. These are based on subjectivity and normative belief systems which generates a predictability of behaviour in social interactions which is reinforced by a system of rewards and sanctions. Hence understanding informal institutions is crucial to entrepreneurship as it defines how societies accept entrepreneurs and the level it is encouraged.
Thus several academics have emphasized that informal institutions are widely acknowledged as crucial in explaining different levels of entrepreneurial activity between societies ( Puffer, McCarthy, and Boisot, 2010), however little research has investigated its effect on opportunity recognition (Tracey and Phillips, 2007). As a result understanding entrepreneurship in its cultural context is crucial in order to effectively foster its activity (Bruton, Ahlstrom, and Li, 2010 ). It has to be noted however that, although it is very difficult (Estrin and Mickiewicz, 2011), institutional norms can be subject to change, especially regarding normative perception of entrepreneurship. As entrepreneurship becomes more visible and valued in a society, it gains legitimization, leading to a growth of entrepreneurial ambitions which in turn reinforces the emergence of a pro-entrepreneurship culture (Williams and Vorley, 2015). As a result, entrepreneurs themselves can be considered as aspiring change and thus influences the institutional landscape. As people follow societal clues of what is working and what others have chosen to do, witnessing successful entrepreneurs play a crucial role in moving a society to a more entrepreneurial culture (Minniti, 2005)
Finally financial and non financial assistance primarily relates to credit availability to entice entrepreneurial activity and to promote growth. However, entrepreneurs also need to support 22
services in addition to financial assistance, especially to aid them in approaching the market. Entrepreneurs need most assistance in conducting market studies, preparing business plans, and getting loans for which business incubators can play a major role in providing a variety of services to startup entrepreneurs (Gnywali and Fogel, 1994) Thus by providing office space facilities, faster and efficient means of communication, and counselling and advisory services to their tenants at low costs, incubators can be very helpful to successfully approach the market.
Moreover formal institutions can also support access to material resources required for the operations of specific ventures. The paper by Gnywali and Fogel, 1994 is particularly relevant to entrepreneurship as it illustrates the multileveled impact formal institutions have on forging the level of entrepreneurship. Starting from the educational capital to enable identification and exploitation of opportunities to creating a (fiscal) environment that encourages positive views regarding entrepreneurship, formal institutions have a huge impact on shaping a country's entrepreneurial spirit. Not only do they influence the level of entrepreneurship, but also the characteristics and quality of entrepreneurship initiatives, by making them more or less productive (Bruton et al., 2010). Thus, the institutional environment and economic policies not only create rules for organizations and individuals, but also determine the incentive and difficulty for starting a business (Valdez and Richardson, 2013). Moreover technical and business education was also identified as a crucial element in which formal institutions can encourage entrepreneurial activity as it provides individuals the tools to act upon identified opportunities (Gnywali and Fogel, 1994), forge their entrepreneurial alertness and overcome problems at various stages of their entrepreneurial process. Thus numerous studies have highlighted the importance of the institutional environment to explain differences in entrepreneurial activity between countries.
How Formal institutions shape entrepreneurship
Although significant research has shown that institutional logics can promote entrepreneurial activities within a country through various methods, they can also have a direct effect on the development of new technologies. Many scholars have attempted to investigate the complex process of the development and diffusion of new technologies in order to provide a better 23
understanding of innovation processes. Thus the Technological system approach (TIS) suggested by Bergek et al. (2008) and Hekkert and Negro (2009) conceptualizes the mechanisms necessary for new innovations to flourish and adopted by the market. They identified 7 key processes and underlying indicators that lay the foundation of successful innovations systems and its performance as outlined in appendix 4 : Entrepreneurial activity, knowledge development and knowledge diffusion, guidance of the search market creation resource mobilization, counteract resistance to change. Here entrepreneurship plays a central role for a well functioning innovation system as they turn the potential of new knowledge, networks and markets into concrete action in order to take advantage of an identified business opportunity Kooijman et al. (2017). Thus they are key elements in knowledge development of emerging technologies as entrepreneurial experimenting provides more information about the performance of innovation and thus reduce uncertainties.
These key processes contribute to the construction of structures that can support the development of new innovations and facilitate its progress and diffusion, hence creating innovation systems. They theory prompts that the successful development of emerging technologies depends on its immediate socio-technical systems and regimes (Kemp et al., 1998; Turnheimand Geels, 2012), including policy and perceived legitimacy. Thus the successful development of innovations requires numerous actors that contribute to the innovation process in myriad of ways ranging from knowledge development, supply of financial resources, standardization and use of innovation (Kooijman et al., 2017) which sets up the structure for successful innovation systems. However if only a singular critical component is missing or isn’t sufficiently active, it may block or slow down the entire process (Hekkert et al., 2009), thus hampering new innovations (Jacobsson and Bergek, 2011). Institutions therefore play a major role in aiding the development of certain innovations systems. Not only does it define the regulatory environment but it also guides dominant technological trajectories. It sets expectations in regards to innovative methods by providing legitimacy to organisations and certain practices (Kooijman et al. 2017). Thus institutional logics can hamper successful development and diffusion of innovation because it creates economic, technological, cognitive and social barriers for new technologies.
Thus formal institutions shape business activity, directions of innovation and economic development in a given field (Alvarez and Urbano 2012; Thornton et al. 2011) by providing not only financial and non financial but also by granting legitimacy to certain actors. Legitimacy is not a resource that can be possessed, but a fundamental state that reflects that organizations adheres to normative and other socially constructed values (Wong et al. 2018). By adapting to the institutional frameworks, companies can justify their actions and show their activities are desirable to a society. These logics are enacted through institutionalized practices that a normatively endorsed and backed up by authoritative power (Thornton et al., 2012) and thus become taken for granted and commonly reproduced in a particular field (Berman, 2012)
Legitimate organizations and innovations are perceived as more trustworthy which facilitates their access to resources and subsequent diffusion (Thornton et al., 2012) Though companies have to align their offerings and operations to institutional frameworks to be able to have access to institutional support. Established organizations have fewer problems accessing these resources as their past performance indicated their alignment to institutional values (Thornton et al., 2012). However new firms on the other hand must act proactively to to prove their legitimacy and attract institutional support (Thornton et al., 2012). Research on institutions has tended to emphasize how organizational processes are shaped by institutional forces that generally reinforce continuity and reward conformity. If innovations or firm activity strongly deviates from prescribed institutional logics they will not be regarded as legitimate and will not receive any support from authorized powers (Kooijman et al. 2017). Although this process assures legitimacy and provides guidelines on how to best proceed, it can strongly affect the entrepreneurial ambitions(Thornton et al. 2011). According to the model by Wong et al. (2018), prospective entrepreneurs evaluate and pursue entrepreneurial opportunities based on various and frequently combined underlying institutional logics. Legal constraints such as governmental regulation are generally perceived negatively by potential entrepreneurs (Gnyawali and Fogel 1994), who may be discouraged from starting a business if they have to follow many rules and procedures (Urbano and Alvarez, 2014).
Therefore it is crucial for newly entering player adapt to their environment by changing their structure and practices in order to align with the institutional patterns, a process also called coercive isomorphism (Dimmagio and Powel, 1983). This process particularly occurs in an industry where there is strong financial reliance, centralized resources with few alternatives and when the dependent organization has ambiguous goals (Dimmagio and Powell, 1983). The space sector ultimately classifies in that category as it characterized by a large number of actors, complex technologies, budget shortfalls, time constraints, uncertain outcomes and strong reliance on large external fundings (Wong et al. 2018). Thus companies have a high degree financial reliance on centralised resources forcing them to be isomorphic to their environment (Wong et al., 2018). As a result of always complying to institutional logics they might miss out on opportunities or be dissuaded to engage in entrepreneurial venture. Thus litterature pays little attention into how the persistence these logics and subsequent isomorphism can impact the identification and exploitation of new new opportunities.
Background information of the French space industry
This section aims at providing a better understanding of the research setting, and current dynamics in the sector in order to better integrate its data in to its context.
1) A new commercial space era
Since the launch of the first artificial Earth satellite by the Soviet Union in 1957, the field has greatly evolved. The successful launch of Sputnik marked the beginning of an era known as “Space 2.0”, where individual spacefaring nations engaged in a space race (ESA, 2018). This ultimately lead to the Apollo program that successfully achieved landing the first humans on the moon. The conception of the international space station marked the beginning the era “Space 3.0”, where nations finally perceived space activities as an international initiative the next frontier for cooperation and exploitation (ESA, 2018). “Space 4.0” represents the next evolution of the space sector which is characterised by the increasing number of international private actors joining the sector and providing services through out the innovation chain (Mazzucato and
Robinson, 2016). The development of this new era heavily relies on the interaction between government, private sector, society and politics.
Two distinct type of activities primarily constitute the the space economy. Thus upstream activities are focussed on sending objects into space and space exploration. It ecompasses provision of technology such as space prime contractor, contract R&D, space component supplier, and space subsystems (SEEDA, 2009). The downstream covers the exploitation of technology such as satellite broadcast services,satellite broadcasting, communication, Earth observation, geo-location, and global navigation equipment and services. Downstream activities has seen the greatest rise of new entrants and users as it only relies the access to space data.
As a result space entrepreneurship has become a major topic of discussion within international space communities. The sector continues to have barriers for new entrants considering the sector appears to prefer costly large-scale projects under government leadership or alongside major multinational companies building highly complex space systems. Although there is a great interest in promoting this movement for its potential regarding new approaches to technology development and risk management, it is at a very early stage and still lacks the proper infrastructure for the optimal development of the space economy. It is therefore imperative to analyse the responses of european space agencies such as CNES to the the evolution of the space sector and study how affected stakeholders view the subsequent actions taken by these institutions.
History of the french space sector
France has been an important player in shaping the evolution of the space environment. It’s involvement began after the second world war, when France had the opportunity, alongside other victorious countries, to study the technological advancements following Germany’s defeat (Carlier and Gilli, 1994). This gave France the chance to study what was at the time the most advanced missile technology available, the V-2 rocket and force nearly 40 German scientists and engineers to continue their research under French supervision. As a result for the next decade,
France ‘s space endeavours focused on developing independent rocketry capabilities. This led to the creation of the Laboratoire de Recherches Balistiques et Aérodynamiques (Laboratory for Ballistic Research and Aerodynamic, LRBA) in 1949 resulting in the first successful launch of a French rocket in 1952 (Carlier and Gilli, 1994). However by the end of the 1950s, France’s space programme was lagging behind the big superpowers. In 1958, president Charles de Gaulle initiated the creation of a space research committee which took form in 1959 under the supervision of Pierre Auger. In 1961, president de Gaulle signed the creation of the Centre national d'études spatiales (National Centre for Space Studies, CNES) whose role was to to organise French space activities. As a result France became the first European nation to establish a space agency. This led to several successful missions such as the development of the Diamant rocket family and the subsequent successful launch of Asterix, the first French satellite in space (Carlier and Gilli, 1994). This made France the third nation to independently and autonomously send a satellite into space following the USSR and USA. Despite their success and ambitious national space programmes, France and other space ambitious European countries considered that they wouldn't be able to compete with the superpowers on their own and it became apparent that the space sector was ideally suited for European cooperation. This led to the creation of the European space agency in 1973 aiming at combining European resources for space related activities.
Ever since, France has been one of ESA’s most important financial contributor and plays a pivotal role in building Europe’s space capabilities to exploit the potential offered by space (CNES, 2018). Through the creation of the Arianne programme, France and Europe have managed to acquire autonomous access to space allowing to foster scientific programs and the development of new space technologies and to explore new possible applications. As soon as new viable opportunities were identified that benefited the population, Europe cooperatively developed and implemented them. This is best exemplified by the development of telecommunications (EUTELSAT, created in 1977) and Meteorology (EUMETSAT, established in 1986) and more recently through Galileo navigation programs and through the Global Monitoring for Environment and Security initiative (GMES) which are satellites put in place to
monitor land, oceans and atmosphere, as well as in crisis areas (Carlier and Gilli, 1994). This marked France’s and the European Union’ s active participation in the space sector and allowed the development of other other relevant international space programs such as its’ contribution to the creation of the international space station (ISS).
Position of the French space industry in the space sector
As of today France commits more resources than any other European country in space activities, and is one of the largest contributors to ESA with over 965 M € (CNES, 2018). Furthermore the French space industry is also a leader in Europe, consolidating a turnover of 6 billion a year which accounts for half of the overall European industry. Moreover, France has one the of the highest budgets dedicated to civil and military space activities with approximately 2 billion € a year, which represents a third of the overall European budget and is second largest budget worldwide after the US. France’ s dedication to the space industry is also shown by governmental decisions to devote over 58 € million of future national investment programmes. (CNES, 2018) France’s long intensive involvement with the sector enabled them to become a leading player when it comes to space technologies from diverse fields, ranging from launching systems, observation satellites, meteorological satellites, telecommunication satellites and satellites dedicated to scientific research. France's technological excellence is renowned worldwide leading them to cooperate with established space superpowers such as the United states and Russia (CNES, 2017). The success of the French space industry can be traced back to the active efforts of its space agency in coordinating the efforts of various actors and to develop efficient innovation systems through collaboration with various research institutes and private parties.
France’s dedication to the space sector has also led the French industry to have the largest space economy in Europe, and one of the largest in the world. For a long time, French space policies were focused on solidifying their position in the international upstream segment and to maximise their export share (CNES, 2017). This prompted France’s national space manufacturing industry to employ over 16,000 highly skilled workers in 2015, and disposes of a budget of over 2.127 29
billion € (Consulate General of France in New Orleans, 2015). Moreover, investments in space have also brought along broader economic and social benefits through the use of services enabled by satellite systems in domains ranging from space observation, meteorology, telecommunication and navigation. This allows for the development of a myriad of applications in various areas that can benefit directly or indirectly from tools provided by space systems to enhance their efficiency and productivity (examples include industries such as: construction, sea and air transport, mineral and natural resources and agriculture) (CNES, 2018). It is estimated that each euro invested in the space industry generates twenty euros in value creation for the whole national economy (Consulate General of France in New Orleans, 2015). Thus the importance of space activities is reflected in its ability to stimulate innovation and developing new high technology solutions for other markets making space a strategic sector for public policy, industry, the economy and science.
The French space industry and stakeholders
The most relevant sector in France’s space manufacturing industry is the production of space systems, followed by the production of propulsion systems and finally, equipment manufacturing (Bryce Space and Technology LLC, 2017)). As a leading player in Europe, France has some of the largest space prime manufacturers. The most important French prime contractors are Airbus Space and Defence, and Thales Alenia Space and Safran S.A.. These companies are considered prime contractors that receive commissions directly from governments, space agencies or commercial companies to build complete spacecraft systems and collaborate with other subcontractors in the industry. Thus these players are key in shaping and enabling France’s space capabilities.
Although the majority of emerging technologies in the sector have been developed as part of space programs, many have highly technical characteristics that can then lend themselves to new applications on Earth. As these technologies have to be designed and manufactured to withstand operate the harshest environment of space, they offer cutting edge advantages in many areas such as strength, durability, low weight, efficiency, reliability, miniaturisation and radiation-proof
(European Patent Office, 2018) and many others. As a result new technologies emerge through public funded programmes which are then patented by the national agency. Furthermore Investments in Space technology are also very significant as it can be a great source of technology transfer for other industries by finding new uses of technologies developed for space. The space sector itself also benefits from technological advancements from other industries as they can optimize current technologies or find new unique uses for upstream activities (Examples include solar panels, fuel cells, teflon and space blankets) (European Patent Office, 2018)
Moreover with advances in digital technology, miniaturization and embedded smart systems, space is attracting the interest of businesses and entrepreneurs across a range of sectors that were before unrelated tpace. Fisheries, agriculture, construction, security, hazard management, land planning, natural resource management and monitoring and combating pollution are just some of the applications space technologies can contribute to (CNES, 2017). As a result CNES encourages the transfer of technology in areas where space can be an effective public service tool by forging partnerships with major players like SNCF and the national meteorological service Météo-France. Cnes also encourages the use and integration of these technologies by providing access to a portfolio of several hundred exploitable patents in fields as varied as telecommunications, electronics, optics, mechanics and biology (CNES 2016). This spurs the creation of new commercially minded spin offs that facilitate the diffusion of space technologies to the general public by providing new innovative solutions.
Entrepreneurial ecosystem in French space sector
In order to foster and support this process , cnes is heavily invested in nurturing a downstream ecosystem built around space technologies and specific infrastructures. This ecosystem relies on a network of established stakeholders that specialized in the transfer of technologies and that can respond to the agility of the evolving market (CNES, 2016).
Starting with establishing strategic partnerships with key research organizations such as with the French aerospace research agency (ONERA), the national scientific research centre (CNRS) or the French atomic energy and alternative energies commission (CEA),CNES coordinates their research activities to foster new innovation in for space and is responsible for proposing, shaping and implementing French Space policy (CNES, 2015). As a result a large part of its budget is dedicated to fund and support the development of new Space technologies and promote collaboration with the various industry players to enable their applications in all sectors of society. This has led France to be a leading innovative force in space technologies have its technological excellence in the space industry be renowned worldwide (Office for Science & Technology of the Embassy of France in the United States, 2008). The success of france's space competitiveness can be explained through its well organised cluster based approach the development of its space and aerospace industry. These clusters enable to more efficiently and effectively coordinate R&D tasks by region to avoid redundant funding and foster innovation in a more favourable environment where information sharing is encouraged.
France has three major regional aerospace clusters : Aerospace valley which is located in the Aquitaine and Midi-Pyrénées regions, ASTech cluster in paris and its region and finally the Safe cluster in Provences Alpes and Côte d’Azur. They are all host to major high level specialized research centres and laboratories, as well as members from both academia and industry. Created in 2005, Aerospace valley is one of the most significant innovation competitiveness cluster in the fields of aeronautics, space and embedded systems. Employing over 124 000 industrial workers and 8 500 researchers, aerospace valley contains over ⅓ of the french aerospace workforce and around 45 % of the french national R&D potential in the aerospace sector(Aerospace Valley, 2018). With over 827 members from both industry and academia, it is an ideal environment to foster innovation, collaborative projects and networking.
One of the main goals aerospace valley is to effectively leverage the innovation potential of space technologies to other sectors by promoting and supporting new start ups. For this purpose, in 2013 the ESA Business Incubation Centre (BIC) Sud France opened aiming to inspire and aid
