Building Your Community Resources for Local Entrepreneurs
Entrepreneurs and small businesses are the backbone of our local communities and economies. They start new businesses, create jobs, provide essential goods and services, and build vibrant and diverse communities and economies. When entrepreneurs start and grow their businesses, communities’ benefit. They don’t just create jobs within their own companies, they support other local businesses as well. When an entrepreneur grows their business, they increase their spending on local goods and services. To grow their economies, communities need to invest in building their entrepreneurs ecosystem and develop resources and systems that support local entrepreneurs.
An entrepreneurial ecosystem is the environment, culture, community, resources, infrastructure, and people that support entrepreneurs. Community members, leaders, and entrepreneurs make choices that determine the success, impact, and vibrancy of their entrepreneurial ecosystem. They develop resources and education, build a welcoming and supportive environment, foster connections, and promote a culture of innovation. Below, we highlight a few of the key components that make up a vibrant entrepreneurial ecosystem and provide examples of what other communities and organizations have done to support entrepreneurs. If you want to learn more, register for our upcoming free webinar on Building Your Community’s Entrepreneurial Ecosystem.
Communities need to strive to build connected and networked entrepreneurial ecosystems that connect entrepreneurs to each other and the resources that they need. Social networks are one of the most valuable resources a new business can have. Entrepreneurs use their networks to access capital and other resources; find mentors, customers, and partners; and receive critical feedback and guidance on their endeavors. Building a connected ecosystem is even more important in rural communities where social networks are smaller and entrepreneurs face unique challenges developing the same number and type of connections as their urban peers (Freire-Gibb, 2004).
Communities can help foster connections and build networks by hosting workshops and happy hours, developing events like guest speakers and pitch competitions, and establishing mentor programs to connect new and experienced entrepreneurs. Here in NH, Extension worked with Making Matters NH and HRKNSS Cowork to bring the Kauffman Foundation’s 1 Million Cups event to central NH. The monthly event brings together entrepreneurs and community members to present their business or ideas, discuss their challenges, and receive feedback and guidance to help them grow. Importantly, the event builds connections between entrepreneurs and to the community and introduce new business ideas to residents.
Develop Technical and Financial Resources
Entrepreneurs need access to technical and financial resources in order to grow. Access to capital is sited by entrepreneurs as one of the biggest barriers they face in starting and growing their business. Communities have developed resources for their local entrepreneurs like grants, prize and award funds, and revolving loan funds that provide important early investments to support growth. Communities can also educate and convene local banks, credit unions, and other investors so they understand the importance of entrepreneurs and can tailor their lending practices to their higher risk endeavors. Lastly, many communities have taken more innovative approaches to get capital into the hands of early-stage entrepreneurs. They’ve started crowdfunding platforms, launched pitch competitions, and provided critical knowledge to entrepreneurs that can make a world of difference when they’re trying to understand the array of resources that are available to them.
Both the Monadnock Region and Upper Valley brought the national platform The Local Crowd to their regions to help early stage and socially minded ideas get off the ground and grow. The platform allows community members and outside entities to donate to different causes or businesses that they support. Other organizations have partnered with companies like Main Vest to get needed capital into the hands of private sector businesses looking to get started. Crowd funding platforms are a good fit for small communities where residents are often invested in their local businesses and small amounts of capital can make a big difference to an emerging entrepreneur.
Build A Culture of Innovation
Communities need to foster a culture of innovation that promotes entrepreneurship as a viable career path, builds trust, encourages risk taking, and supports innovation and not just incumbent businesses. Entrepreneurs take risks with their money, time, and social standing to start a business and pursue a new idea. Entrepreneurial risk can be especially challenging in rural and small communities where many individuals have strong community ties and deep histories (Foster, 2001). Communities have built their entrepreneurial culture by encouraging young people to pursue entrepreneurship as a viable career path, support business failure as an important step in the entrepreneurial process, and building organizations to provide programs, resources and mentorship for entrepreneurs.
In Lyndonville, Vermont, Do North Coworking started a program to accelerate new and innovative businesses in the forest industry. This program recognizes the historic importance the forest industry had in the region. It leverages that history to focus on developing innovative and high growth businesses that grow the local economy. The program aims to attract and accelerate technology and other growth-oriented businesses to the region and offer them the resources, mentorships, and assistance they need to grow.
Welcome and Include All Entrepreneurs
Communities need to be welcoming and inclusive of entrepreneurs and individuals from different backgrounds and experiences that bring new ideas and approaches. Inclusive ecosystems benefit individuals, businesses, and communities (Lee, Florida, & Acs, 2004). When entrepreneurship is accessible, individuals see new opportunity, communities are more vibrant, and businesses benefits from diverse insights and approaches. Communities should be proactive in welcoming and including all entrepreneurs and individuals. They should reach out to underserved communities, host events and programs to attract and welcome new individuals to the entrepreneurial ecosystem, and develop programs and resources to serve a diverse range of entrepreneurs.
In Waterville, Maine the Chamber of Commerce and the public library have come together to start a small business week. They host events focused on supporting entrepreneurs and celebrating their local small businesses. The types of events help to create a welcoming ecosystem for entrepreneurs by letting them know they are valued and appreciated with the local community, while also increasing exposure for them and their businesses.
Olivia Shock is the Community Entrepreneurship Intern on Extension’s Community and Economic Development team this summer. Olivia is working on developing guidance, programs, and resources for communities and entrepreneurs so they can build and improve their entrepreneurial ecosystems.
Foster, N. (2001). Entrepreneurship in rural communities: An emerging strategy presents opportunities and challenges. Federal Reserve Bank of Minneapolis.
Freire-Gibb, C.(2014). Entrepreneurship Within Urban and Rural Areas: Creative People and Social Networks. Journal Regional Studies.
Lee, S. Y., Florida, R., & Acs, Z. (2004). Creativity and entrepreneurship: A regional analysis of new firm formation. Regional studies, 38(8), 879-891