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What are Ecosystems & Why do they Matter?

From cities to industries, ecosystems make up the world we live and work in everyday. But what are they?

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Part 1: What are Ecosystems?

Ecosystems are ever-changing networks of people, resources, organizations, and the relationships between them, united by a common characteristic, such as a shared geography, industry, demographic, or combination of those factors.

The definition of modern ecosystems doesn't roll off the tongue, we know. Even if you haven’t heard the definition, you’ve probably heard it used:

  • Baltimore’s Tech Ecosystem refers to the tech and startup community within the city of Baltimore.
  • The Web3 Ecosystem refers to the collection of people, businesses, and other organizations who are involved with or building in Web3.
  • Dallas’ Arts Ecosystem, The CleanTech Ecosystem, and Cisco’s Partner Ecosystem all simply refer to the constellation of people, organizations, resources, and the activity & relationships involved in those communities.

Part 2: Where are Ecosystems?

Ecosystems are everywhere. Every community is an ecosystem, every city is home to dozens of ecosystems, and every industry, sector, and subsector is an ecosystem as well. Most of us live and work in numerous ecosystems, and their prevalence is one of the main reasons why ecosystems are so important to understand.

The ‘characteristics that unite’ an ecosystem include industries (the Bioscience ecosystem), business models (the high growth startup ecosystem), geographies (Baltimore’s ecosystem), demographic groups (the Women-Owned ecosystem), and combinations of these factors (the Baltimore Women-Owned high-growth bioscience ecosystem).

These Unifying Factors, one of four core attributes of ecosystems, are what create the boundaries of an ecosystem; because of this, ecosystems can be infinitely nested within eachother, and adjacent ecosystems often overlap, such as Maryland's Business Ecosystem and Baltimore's Tech Ecosystem.

Part 3: What are Ecosystems made of?

Ecosystems are networks of Assets and the Relationships between them. Primary Assets are the main “things” within an ecosystem, and they include People, Organizations, and Resources. Secondary Assets are typically smaller, transient (their importance is time-based), and they arise from actions and interactions between Primary Assets. These include Events, Jobs, and News.

The Relationships are simply how these assets relate to eachother - which Organization provides which Resource, what Person is employed by what Organization, which Organizations partner together, etc. Structurally, ecosystems are complex networks, meaning they are made of nodes and edges, representing the Assets (nodes) and the Relationships between them (edges).

Part 4: Why do Ecosystems matter?

There are three main reasons that ecosystems matter: 

  1. Ecosystems are everywhere

    Every town, city, state, industry, sector, professional network, economy, impact initiative, demographic group, and beyond all share the same ecosystem structure: they are complex, always-evolving networks of assets bound together by relationships. Whether we like it or not, we live and work in numerous ecosystems, and it helps to understand how and why they work.

  2. Ecosystems teach us about how the world works

    Due to this shared structure, all ecosystems are remarkably similar in the way information flows through them, how they change and are changed, and the challenges they face.

    "The ecosystem lens" helps you understand both how a new industry is formed and how a main-street economy is transformed. You can learn a lot about how information flows through an industry by studying how information flows through a university. Lessons learned from entrepreneurial ecosystem building can be applied to partner-network development, and the challenges faced by innovation ecosystems shed light on how we can improve small business communities.

    Studying ecosystems allows you to quickly distill insights that are applicable across pretty much any network or community you find yourself in. In that way, studying ecosystems is a shortcut to understanding the numerous networks that we live & work in everyday.

  3. Ecosystems are incredible tools for change

    Let’s say you want to create a stronger entrepreneurial community at a university. You could start an organization that does everything: an entrepreneurship club, incubator, accelerator, angel funding, conferences, and a mentor network. While possible, setting up that organization & getting the funding to run it takes an incredible amount of time and effort, and then there’s the uphill battle of promoting the organization and getting people into its network.

    Alternatively, you could use an Ecosystem-Led Development Approach - identify all the different clubs, people, and events that are interested in entrepreneurship, create or strengthen the bonds between them, and mobilize each individual asset to set up a key part of the ecosystem. This approach is drastically more effective - it not only distributes the work, but it has a greater reach since each asset engages it’s own network, and it encourages more equitable engagement and outcomes because more people becoming involved in the growth of the ecosystem

Ecosystems matter not only because they are everywhere, but because they provide a simple way for us to understand the vast, complicated networks that we operate in, and they provide a model for creating systems-level change that is dramatically more effective than the discrete-change tactics that we tend to use. In short, understanding ecosystems gives us the tools we need to tackle systems-level problems and make sense of the complicated communities around us.

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