Founders often focus on building products and teams, but the environment they operate in is just as critical. For policymakers, this underscores the importance of startup ecosystem development, the deliberate effort to create the conditions in which innovation can grow in a location. A strong ecosystem connects entrepreneurs with investors, mentors, and pilot-ready partners, creating a cycle of growth that benefits the wider economy. In contrast, weak or fragmented ecosystems limit opportunity and slow progress, regardless of individual talent.Governments and public sector organizations have a unique role in shaping these environments: by improving the business conditions, supporting infrastructure, and aligning policy with the needs of innovators, they can create a sustainable economic impact through startups. This article builds on our years of experience offering startup ecosystem development services to dozens of governments around the world and serves as a comprehensive guide to startup ecosystem development. It explores the core features and components that enable ecosystem developers and policymakers to design, support, and scale startup ecosystems. What is a Startup Ecosystem? A Startup Ecosystem is the result of the environment within which startups and other supporting players operate in. There are multiple factors that we can look at when defining startup ecosystems, and in our reports, you will first find a definition of the hub or particular place, that narrows down the physical location of startup ecosystems, to be able to rank their growth and innovation. To provide accurate rankings, we offer two sets of rankings that each focuses on the interactions of the key players within the ecosystems: Countries Cities Because determining the origin of a startup can be complicated in today’s global economy, when ascertaining the strength of a startup ecosystem, we put less focus on where a startup is currently headquartered and more on where it was birthed. While the presence of startups within an ecosystem is the first and most vital piece, they must be complemented by investors, service providers, incubators, coworking spaces, startup organizations, universities, investor networks, and many other players, for them to become successful and thriving startup ecosystem hubs. It is this combination of multiple internal and external factors that fuses to create a vibrant startup ecosystem. The “soft” and “hard” infrastructure components of startup ecosystems will be explored below in more detail. The Components of Startup Ecosystem Development In this section, we will briefly explore the components that make and maintain the vitality and vibrancy of startup ecosystems. As previously mentioned, ecosystems are primarily focused on startups. However, they require a network of support in order to stay alive. These can be broadly broken down into hard and soft infrastructure systems that follow the same premise as industrial categorizations of hard and soft infrastructure. In addition to startups themselves, there are half a dozen key components that every startup ecosystem needs to include in order to thrive. Hard vs Soft Startup Support Systems You can also look at the components of startup ecosystems as “hard” versus “soft”. Hard infrastructure development includes the physical spaces such as coworking spaces, incubators, accelerators and universities while the soft infrastructure is the mentoring groups, startup networks, and community support that is present in an ecosystem. Universities, Colleges and Education Providers The idea here is that education providers create sought-after talent and for this reason, they have often been called the “original incubators”. Additionally, even when universities are not able to keep up with the demands of the market, they can develop the culture of entrepreneurship, through programs, training days, courses, and bootcamps, where students can be equipped with in-demand skills. When these are combined with hiring or mentor programs hosted by startups, this creates an opportunity for future employment opportunities. Funding Organizations Self-funding is the most popular path for most new entrepreneurs. However, the presence of funding providers like angel investors, venture capital firms, and government loans is vital for the future success of the ecosystem. Support Providers Coworking spaces, incubators, and accelerator programs all need to exist within a healthy ecosystem in order to push it forward and cr