We don’t need to re-argue whether Portugal has a problem. This note does two things. Part One sets out the diagnosis in full: not “Portugal doesn’t innovate enough,” but a specific, five-link chain running from where new activities start to who ends up owning them, and the exact points at which that chain breaks today. Part Two explains why CONSTRUIR, in the form we have designed it, is the right instrument to close the parts of that chain a movement can actually close and not merely one plausible option among several.
PART ONE — THE DIAGNOSIS: THE FIVE GAPS
A working diagnosis of why Portugal creates value it does not keep, and what would change it.
Purpose of this note
This section sets out a diagnosis and a set of remedies. It is written to be argued with rather than agreed with, and it deliberately avoids assigning blame. The failures described here are structural: they are what any set of competent, well-intentioned people would produce given the incentives currently in place. Naming individuals or professions as the cause would be both inaccurate and strategically costly, because most of the people who would have to act on this diagnosis are inside the institutions it describes.
Two premises are taken as given and not re-argued:
• Fiscal reform and lower administrative friction are real improvements. They are necessary and they are insufficient. They change the cost of operating; they do not change what a country knows how to make.
• Wealth at the national level comes from moving into activities with higher value per unit of effort: designing, building, branding, and selling sophisticated products into world markets. Optimizing an existing activity has a ceiling set by what that activity is worth, however well it is run.
The question this note addresses is narrower and more useful than “what is wrong with Portugal.” It is: at which specific point does the chain break?
The core finding
Portugal is not failing to produce sophisticated capability. It produces it and then loses ownership of it.
This distinction matters more than any other point in this note. The weak version of the complaint that “Portuguese entrepreneurs cannot get funded” is easy to dismiss with counterexamples and funding statistics. The accurate version is harder to dismiss and points to different remedies: Portuguese-originated companies do get funded, and they get funded abroad. The knowledge is created here. The equity, the tax base, the senior commercial roles, the acquisition proceeds, and the next generation of experienced founders end up elsewhere: in the US, Germany, Sweden and Canada.
Note that this list is not simply “the United States.” Sweden and Canada are mid-sized economies with the same theoretical constraints Portugal has. What they possess is a functioning chain from origination to scale, including domestic institutional capital that allocates to venture. This is therefore not a story about scale, latitude, or national character. It is a specific, identifiable, and fixable break in a chain.
The chain has five links. Portugal is weak at four of them and strong at one.
Gap 1 — Origination
The mechanism
New high-value activities must start somewhere. In economies that move up the value chain, the origination point is usually either an existing firm entering an adjacent activity, or a research institution deliberately spinning out new industries.
Portuguese incumbents rarely originate, and this is not a failure of ambition. A firm that has selected itself for excellence at optimization within a known activity cannot demand a capability it has no way of imagining a use for. Waiting for demand from such firms is waiting for something that will not arrive.
That leaves the research system as the realistic origination point. The relevant precedent is not that Stanford and MIT were excellent. Portuguese universities are also capable. But Stanford and MIT from the late 1940s adopted an explicit mission to have professors and students create new industries and organized themselves accordingly. Portuguese and European universities largely assume that existing companies will venture into new areas. They seldom do.
That does not mean that new high-value ventures must originate inside universities. Increasingly, they do not. Today, knowledge-based ideas can emerge almost anywhere: from entrepreneurs, engineers, designers, clinicians, students, online communities, or individuals working independently. The linear model in which universities invent, and companies commercialize is giving way to a much more distributed process of innovation.
Universities nevertheless remain the place with the highest probability of generating breakthrough ventures, not because they possess a monopoly on ideas, but because they concentrate exceptional talent, pursue the creation of new knowledge, and enjoy something few other institutions possess: the freedom to experiment and the institutional permission to fail. If that freedom were coupled with an explicit mission to create new industries—as Stanford and MIT progressively adopted after the late 1940s—their comparative advantage would become even greater.
Equally important, universities should not be viewed only as the birthplace of innovation. Their greatest contribution increasingly comes after the initial entrepreneurial insight: strengthening prototypes with deeper science, validating assumptions, improving robustness, creating defensible intellectual property, and providing the scientific credibility that allows new products to scale globally. They become partners in invention rather than its exclusive source.
Portugal’s challenge, therefore, is not simply to transform universities into startup factories. It is to build an ecosystem in which entrepreneurial initiative can originate anywhere while universities become active collaborators throughout the innovation journey, contributing to where they are uniquely strong.
The remedy
Treat the research system as an origination engine, not a service provider to existing industry. Concretely: career recognition for company formation comparable to recognition for publication; institutional tolerance for professors holding equity and operating roles; and a default assumption that a promising result should be tested as a business, not only as a paper.
The honest caveat
Origination alone is insufficient, and Gap 1 is where most reform proposals stop. See Gap 5.
Gap 2 — The demanding first customer
The mechanism
Sophisticated products are bought before they are good. The early integrated circuit had no commercial market; it had Minuteman and Apollo, a buyer willing to pay high prices for unproven products from firms with no track record, and rigorous enough to reject work that did not meet the bar. The same pattern produced the early internet and much of modern biotechnology.
This is the demand side of the innovation economy, and it is systematically underweighted in European discussion, which treats innovation policy as a synonym for funding. Capital follows a demonstrated first sale far more reliably than a first sale follows available capital. Public procurement in Portugal is structured to minimize the risk of buying something that fails, which is a rational objective that makes it structurally incapable of performing this function.
The remedy
A small share of public and large-corporate procurement explicitly reserved for unproven suppliers solving highly specified problems, with failure treated as an expected and accounted-for outcome rather than as a procurement error. This is an administrative change, not a spending program, and it is among the cheapest interventions available. This is the First Client Initiative.
Gap 3 — Capital that can hold to scale
The mechanism
Seed capital exists in Portugal and has improved substantially over fifteen years. What is largely absent is the capital that takes a company from proven product to global scale. These are the rounds where a company either grows into an independent international business or accepts an acquisition offer. When that link is missing, acquisition is not a failure of nerve by the founder; it is the only available option, and it happens at valuations that transfer most of the future value abroad.
The two most instructive precedents are administrative rather than entrepreneurial. The 1979 clarification of the US “prudent man” rule permitted pension funds to allocate to venture capital and effectively created the modern asset class. Israel’s Yozma program in 1993 used matching public capital with an upside buyout option for private partners, then exited once the funds were established. Neither requires a single university reform, and both are boring enough to be politically achievable.
Portuguese and European pension and insurance capital is largely absent from venture, partly through prudential rules and partly through mandate design. This is the most concrete, most fixable, and least discussed item in this note.
The remedy
Treat institutional allocation to venture and growth capital as a regulatory and mandate-design question and make the case in those terms to the people who actually control it. Additionally: build the domestic conditions under which acquisition is a choice rather than a necessity by having later-stage capital, and the commercial management depth that lets a company sell globally from Lisbon.
Gap 4 — Capture: development, marketing, and selling
The mechanism
In most sophisticated products, the margin lives downstream of the technical work: in design, brand, channel, and customer relationships. A firm can be technically excellent and still capture thin margins, because it occupies the part of the chain where value is created but not captured. Portugal’s characteristic failure is not technical incapacity; the mold cluster, Hovione, Amorim and Bial demonstrate otherwise. It is that the technically excellent firm often sells through someone else’s brand and channel.
This gap requires a category of person the Portuguese ecosystem produces in the smallest numbers: the experienced international commercial operator- the VP of Product, the head of enterprise sales, the person who has taken a product into the US or German market before. Such people are largely produced by having previously worked in companies that scaled, which is circular, and the circularity is precisely why the outflow of senior operators matters so much.
The remedy
Deliberate import and repatriation of commercial and operating experience, treated with the same seriousness usually reserved for attracting researchers. The fastest documented route to acquiring tacit capability is not to grow it but to attract people who already carry it. This is the route taken by Ireland, Czechia and Israel. Portugal has attracted many foreign experts in this area in recent years. We must make a better use of them.
Gap 5 — Density and mobility
The mechanism
This is the link Portugal is best positioned to build quickly, and the one most often assumed to follow automatically from the others. It does not.
Route 128 and Silicon Valley began from near-identical conditions: elite universities, defence spending, engineering talent. MIT’s mission did not decline. Route 128 nonetheless lost decisively from the 1980s, and the standard account attributes the divergence to firm architecture and labor mobility: vertically integrated, secretive companies in Route 128, versus a dense network in which people and knowledge moved constantly between firms, including competitors, in Silicon Valley. Regional advantage turned out to be a cultural artefact before it was a policy artefact.
The relevant conclusion is uncomfortable for both sides of the usual Portuguese argument: excellent universities are not sufficient, and neither is capital. Within a single generation the binding constraint moved to something no ministry had a policy instrument for.
The remedy
Density is buildable without permission, capital, or legislation, which makes it the natural starting point for anything that is not a government program. It requires repeated, low-overhead occasions where people who are building things meet people who are building other things, with a strong norm of openness about what is being worked on.
What this implies for a movement
Four of the five gaps require institutions, capital, or regulation. These are things a movement such as CONSTRUIR cannot supply directly. One does not. Gap 5 is fully addressable by a group of people who decide to build it, and Gaps 1, 2 and 4 are partly addressable through influence, convening, and the deliberate manufacture of first relationships.
This suggests three things about how CONSTRUIR should describe itself.
• It should claim the gap it can actually close. Overclaiming, i.e., presenting a movement as the solution to capital markets or university reform, invites the obvious objection and wastes the credibility needed for the parts it can genuinely affect.
• Its central proposition is capture, not creation. A movement premised on “Portugal must innovate more” competes with everything else that says so. A movement premised on “Portugal already originates world-class capability and systematically loses ownership of it” is a specific, evidenced, and much less comfortable claim. It also explains, without recrimination, why so many capable people left.
• Its founding evidence is testimony. The most persuasive material available is not analysis but first-hand accounts from people who built companies here that became American, German, Swedish, or Canadian: where the funding came from, what was missing at the moment it was needed, and what the specific alternative would have been. Collected systematically, that is a body of evidence no policy discussion currently has, and it is the one thing a movement is better placed to produce than any institution.
Summary
Gap
Question it answers
Who can close it
Origination
Where do new activities start?
Universities and research institutions
First customer
Who buys before there is a market?
Public procurement, large corporates
Capital to scale
Who funds from proven to global?
Institutional investors, regulators
Capture
Who owns the margin?
Firms, and imported commercial experience
Density
Where does knowledge move?
Anyone who decides to build it
The chain is only as strong as its weakest link, and there is no sequence in which one link can be safely completed first and the others left for later. But there is a difference between links that require permission and the one that does not.
PART TWO — WHY CONSTRUIR IS THE RIGHT VEHICLE
The diagnosis above explains where the chain breaks. This part explains why CONSTRUIR, specifically, in the form we’ve designed it, is the right instrument for the links a movement can actually move and not merely one plausible option among several.
1. Why an Ecosystem, not a Fund or a Reform
Ricardo Hausmann and César Hidalgo’s work on economic complexity gives the diagnosis above its theoretical backbone: countries grow rich by accumulating the capability to make an increasing variety of sophisticated goods, and that capability lives in networks of people and firms, not in any single institution or subsidy. A sovereign fund, a tax reform, or a new agency can supply capital or remove friction, which are real improvements, as the diagnosis concedes. But none of them can manufacture the dense, tacit, person-to-person knowledge transfer described in Gap 5 above.
AnnaLee Saxenian’s comparison of Route 128 and Silicon Valley, the source behind Gap 5’s account, is the sharper instrument here precisely because it removes the excuse that Portugal simply lacks talent or capital: both regions started from nearly identical conditions and diverged on culture, not endowment. That is exactly the gap CONSTRUIR exists to close. Not another accelerator or another fund, but the open, cross-pollinating culture itself.
2. Why a Movement, not an Institution
Every instinct in Portugal’s institutional culture pushes toward incorporation found an association, write statutes, elect a board, seek a mandate. We have deliberately refused that instinct, and Kropotkin is the reason we can defend the refusal rather than merely assert it.
Kropotkin’s Mutual Aid is not a manifesto against competition; it is an argument, built from biology and history, that cooperation within a group is often what allows that group to compete successfully against others: guilds, villages, and scientific societies outcompeted isolated individuals not despite their mutualism but because of it. That is the intellectual basis for Mutual Building: builders don’t just help each other, they build together, and the institutions that last are the ones designed to keep producing builders rather than to protect any single founder’s position.
A fund can be captured. A board can ossify. A movement organized around Mutual Building has no center to capture. Its product is the next hundred builders, not the first ten.
This is also why the Founding Circle is explicitly not a governing body and why the Guilds are challenges to own rather than committees to join. An institution optimizes for its own survival. A movement, correctly designed, optimizes for what it produces and hands itself off. Which is precisely the discipline the “what this implies for a movement” section above asks of us: claim the gap you can close, and no more. Gap 5’s remedy, density that is buildable without permission, is, not incidentally, the one a movement rather than an institution is built to supply.
3. Why we Insist on the First Client, not the First Investor
The instinct, including my own at times, is to solve the Portuguese ecosystem problem by attracting more investors. William Janeway’s account of the innovation economy explains why that instinct is backwards, and it is the same pattern behind Gap 2 above: the state’s most productive historical role was never as a subsidizer of last resort but as a demanding first customer. DARPA, the early internet, the Human Genome Project willing to pay for something before a market existed for it, and rigorous enough to reject work that didn’t meet the bar.
Josh Lerner’s survey of public venture-capital programs, Boulevard of Broken Dreams, supplies the cautionary half of the same argument: governments that try to manufacture investors directly, rather than manufacturing demand and tolerance for failure, overwhelmingly produce capital that behaves like everything else in the surrounding economy- safe, late, and imitative. That is precisely the outcome described in Gap 3 and Gap 4 above: investors who back optimizers like themselves rather than the creators of sophisticated products, because nothing upstream has built the discipline of a first, demanding customer.
This is why CONSTRUIR’s engagement model runs through the Builders’ Evenings and the Guilds before it runs through the Capital track. Our job is to manufacture the first client relationship and cultural tolerance for a qualified failure, in that order- the First Client Initiative called for in Gap 2. The capital, on this reading, arrives once that groundwork exists.
4. Why we Build Outside the University, not Against It
Jon Gertner’s history of Bell Labs is useful precisely because Bell Labs was not a university and did not try to be one. It assembled extraordinary talent and gave it space, resourcing, and patience that neither the academic economy of publication nor the corporate economy of quarterly return could offer. The Guilds and the Ideas Network are our version of that space: a place where the currency is a working prototype or a demonstrated result, not a minimum publishing unit.
This is not a rejection of the university. Most of the people we most want with CONSTRUIR are inside one, and plenty of them already agree with the diagnosis above. It is a recognition, consistent with Saxenian’s findings, that the culture capable of producing sophisticated exports has historically had to exist alongside the academic system rather than wait for it to reform itself. Which is also why Gap 1’s remedy asks for career recognition and equity tolerance inside the university, while CONSTRUIR builds the complementary space outside it. MIT’s Mens et Manus took a century to become the exception rather than the rule even within MIT. We are not proposing to out-wait that timeline.
5. Why Portugal, and Why this Is a Return, not an Import
None of the above is a foreign transplant. The Conferências do Casino Lisbonense of 1871 led by Antero de Quental and a small circle of scientists, poets, and thinkers asked exactly this question about a Portugal falling behind, using the same instrument: an informal, self-organized group willing to name what was wrong before any institution would. GASA, the informal research group we created at Universidade Nova through the 1990s, is the closer and more recent precedent: proof that this kind of structure can work inside a Portuguese institution when given room to.
And earlier still, the Age of Discoveries, the historical high-water mark this whole invitation gestures toward, was never a purely Portuguese achievement. It was cartographers, bankers, astronomers, and merchants from everywhere, organized around a shared ambitious project. CONSTRUIR’s openness to anyone who wants to build, regardless of nationality or credential, is not a modern liberal add-on to that history. It is a restatement of the original condition that made it possible.
The Point of this Note
You don’t need convincing that Portugal has a problem, or that the problem is structural rather than a matter of individual talent or effort. What this note is for is sharper than that: when you’re recruiting the next builder, the next Guild lead, the next Founding Circle member, you will be asked why CONSTRUIR, and not one more accelerator, one more association, one more government program.
The answer is the diagnosis and the design together. The five gaps say precisely where the chain breaks and which of those breaks a movement can actually reach. Every piece of CONSTRUIR’s design -movement instead of institution, first client instead of first investor, Guilds instead of committees, openness instead of credentialism - is a considered response to a specific, documented failure mode of the alternatives, aimed squarely at the gaps we can close: Density, and pieces of Origination, First Customer, and Capture. That is the argument to make. It is also, not incidentally, the argument that keeps us honest about what we are actually building.
Key sources referenced
AnnaLee Saxenian, Regional Advantage: Culture and Competition in Silicon Valley and Route 128, 1994.
Antero de Quental, Conferências do Casino Lisbonense, 1871.
César Hidalgo, Why Information Grows: The Evolution of Order, from Atoms to Economies, 2015.
Jon Gertner. The Idea Factory: Bell Labs and the Great Age of American Innovation, 2012 .
Josh Lerner, Boulevard of Broken Dreams: Why Public Efforts to Boost Entrepreneurship and Venture Capital Have Failed—and What to Do About It, 2009.
Peter Kropotkin, Mutual Aid: A Factor of Evolution, 1902.
Ricardo Hausmann & César Hidalgo et al., The Atlas of Economic Complexity: Mapping Paths to Prosperity, 2011.
William H. Janeway, Doing Capitalism in the Innovation Economy: Markets, Speculation and the State, 2012.