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Technical.ly
5 hours ago
- Business
- Technical.ly
How local governments can back the entrepreneurs building their regions' futures
Entrepreneurship is increasingly viewed as the most dependable source of broad-based economic gains. Nearly all net new jobs come from new companies and a 1% rise in entrepreneurial activity correlates with a 2% decline in poverty. Post-pandemic growth — led by women, particularly women of color — shows investments in 'inclusive entrepreneurship' worked, but systemic barriers to capital, networks and opportunity still limit would-be founders. A policy 'field guide' recommends redirecting 5% of procurement to firms under five years old, eliminating early registration fees, reforming noncompetes, strengthening libraries as entrepreneurial hubs, designating a clear entrepreneurship leader and elevating existing ecosystem efforts rather than duplicating them. Entrepreneurship can sound like rich people's problems. In certain settings, talking about business starts and business growth all sounds like the cavorting of the well to do. A growing coalition says that's all wrong. 'Entrepreneurship is not just about starting companies,' said Victor Hwang. 'It's about enabling people to solve problems in their communities with innovation and drive.' Hwang refined his bookish charm and pro-entrepreneurship pitch while an executive at the Kansas City-based Kauffman Foundation, which is widely credited for advancing the research and the field of new-business support. This work now gets called ecosystem building, or place-based, entrepreneur-led economic development. Hwang's policy-focused Right to Start nonprofit has just kicked off a national campaign called America the Entrepreneurial, to put entrepreneurs at the center of next year's 250th anniversary of the founding of the United States. Hwang is also among my co-hosts of Builders Live, a monthly podcast on ecosystem building. Ahead of the Global Entrepreneurship Congress, in our most recent episode, alongside investor Brian Brackeen, we checked in on the most surefire policies Right to Start recommends for state and local officials. Entrepreneurship is not a distraction from well-rounded and inclusive economic policy. It's increasingly recognized as the most dependable source of gains, including the following: Nearly all net new jobs come from new companies Every 1% increase in entrepreneurial activity in a county correlates with a 2% decline in poverty — and average household income increased by $500 41% of Americans say they'd launch a business if they could, but just 2% actually do One key input of economic mobility is access to information about the programs and resources (a role we at Technically play) Investments into what has been called 'inclusive entrepreneurship' in the 2000s and 2010s worked. Entrepreneurship has popped post-pandemic, led by women, especially women of color, but barriers remain. 'The reason I founded Right to Start was to change the narrative and the policies that limit entrepreneurship in this country,' Hwang said. A checklist for policymakers to support entrepreneurship Though more is to come, his Right to Start launched ' field guides ' for policymakers, at the local, state and federal levels. A few of their most common recommendations, mixed with a couple from own reporting: 5% to start: 'Dedicate a small percentage of current funding to new entrepreneurs and young businesses, and track the impact…Redirect 5% of government procurement dollars to businesses under 5 years old.' Identify an entrepreneurship leader: This could be an existing lead (like a commerce director), provided they truly prioritize entrepreneurship. Zero barriers to launch: ' Reduce or eliminate registration costs and fees for new businesses in their critical early years,' relying financially on more established firms. Separate new business from small, medium and large businesses: They need different things, and it is the 'new' that create the most positive economic outcomes. Easy access: 'Strengthen local libraries as hubs of knowledge and digital tools for entrepreneurs.' Noncompete reform: 'Unleash entrepreneurs who want to create new jobs by freeing them from unfair bans and noncompete restrictions.' Support existing efforts: Most states and regions have existing 'ecosystem building' efforts. Rather than recreate them, elevate and redirect residents there. This mirrors advice we've given mayors in the past. To support entrepreneurship: Remove barriers, invest in workforce, celebrate homegrown solutions and amplify the priority. (We've made more general tech policy recommendations too) Entrepreneurs start alone, but don't grow without help Many of these steps are intentionally modest. Hwang, though, has a far more ambitious plan: for entrepreneurship to be at the very center of all economic policy. Brackeen, managing partner of Lightship Capital, echoed that idea. 'The barriers that exist for entrepreneurs, especially those from underrepresented communities, are systemic, and we need systemic change,' Brackeen said. 'It's not about handouts. It's about access — access to capital, access to networks and access to opportunity.' The best economic policy doesn't pick industries, it supports entrepreneurs. Entrepreneurs don't pick places to start businesses, they pick places to live and then start businesses there. The ' Ecosystem Stack ' prioritizes both lifestyle issues (like housing) and amplifying these successes. This works. According to new analysis, regions with a dedicated news outlet covering startups earn 60% more media coverage and, over a decade, grow their ecosystems twice as fast as similar peers. The takeaway? Entrepreneurs may start alone, but their companies don't grow that way. Policy, platforms and narrative all shape what happens next. 'If we want more startups,' Hwang said, 'we need to fix the system so it doesn't favor big businesses at the expense of new ones.'
Technical.ly
02-03-2025
- Business
- Technical.ly
Ecosystem building is coalition building
Current federal policy shifts, which are forcing significant funding cuts and other changes to innovation programs, are creating challenges for local ecosystem builders. But ecosystem building is about bringing together diverse groups to support entrepreneurship, technology and economic development. So despite national political turmoil, many local organizers remain focused on practical solutions and community-driven economic growth. Shared goals like job creation can bridge political divides. One definition of justice is ensuring everyone has a fair shot at thriving. That's what lights me up about entrepreneurship, technology and career training. It's also why I care about information resources (read: journalism) and the rule of law. I'll talk to practically anyone who is serious about this work, even if I disagree with them on plenty else. This is the heart of ecosystem building, which I think of as the art of encouraging the big and the small, the weird and the square, the fast and the slow to inhabit the same environment. Not all species need to interact, and when they do some may even be at odds. My pursuit: Find the most important work that stitches together the most good-faith actors. Ecosystem building is coalition building, then — and boy could we use coalition building right now. This week, I recorded the next in Technically's ecosystem-building podcast with investor Brian Brackeen, the founding partner of Lightship Capital, and small business advocate Victor Hwang, the founder/CEO of Right to Start. What unites us is a passion for how local organizing and entrepreneurship define the American project. Our intention is to focus on that local work, which we've all found is better at uniting than dividing. 'When you start talking about entrepreneurship and the power to create jobs, to lift communities, to create wealth, to raise incomes, to fight poverty, fight inequality, it's pretty universal how [popular] that is,' Hwang said. 'But it's also one of those issues that doesn't get talked about much, which means it's still pretty fresh.' Trouble is, I feel unable to ignore how a bombastic start to the Trump administration has impacted local organizing around the country. In addition to firing an estimated 200,000 federal workers and cutting federal funding less out of budgetary consequence than political motivation, the bipartisan Tech Hubs program has been under fire, as has reported, alongside data gathering and AI research. And so, with a pledge to work to focus more on local, Hwang, Brackeen and I took some time to gather our advice for each other, and peers, that are in ecosystem building work around the country. Local bright spots in entrepreneurship Plenty of local organizing continues. Brackeen praised Endeavor, a global network that supports entrepreneurs outside traditional venture capital strongholds like Silicon Valley and New York. '[Endeavor is] doubling down on ecosystems and investing in positive entrepreneurs who create a multiplier effect in their communities,' Brackeen said. Hwang, reflecting on a road trip he took last fall, emphasized the unlikely places where entrepreneurial energy is thriving. 'In Portland, Oregon, there's an effort to build a shoe innovation district in Old Town,' Hwang said. 'In Akron, Ohio, they turned an old Goodyear tire plant into Bounce Innovation Hub, a massive coworking and innovation space.' The federal policy landscape: A challenge for local builders Entrepreneurship-led economic development may be on the rise. But strategies developed under the climate and racial justice–focused industrial policy of the Biden administration are being scrutinized, if not abandoned altogether. A report released last fall by Senate Republicans as an analysis of National Science Foundation grants titled ' DEI: Division. Extremism. Ideology. ' was recirculated this month by organizations attempting to redact politicized terms from their websites and applications. Of the major innovation role research universities play in many regions, Brackeen said: 'If you're Columbus and your ecosystem is driven by Ohio State spin-offs, you could be affected more than, say, Tulsa, which relies on philanthropic private capital.' 'The news makes it seem like we're at war with each other, but when you actually visit communities, people are just focused on doing the work.' Victor Hwang, Right to Start national Map of Innovation Ecosystems includes an index that relies heavily on the influence of major R&D investments. How much those investments change over time will shake up where technology is commercialized. Federally-funded Tech Hubs organizers are nervous. Yet Hwang says on the ground, local organizers and entrepreneur supporters can only focus on what they can control — and many are doing just that. 'It's almost like we live in two different universes,' he said. 'The news makes it seem like we're at war with each other, but when you actually visit communities, people are just focused on doing the work.' Coalition building as a path forward As ecosystem builders look for ways to sustain momentum, the conversation turned to coalition building as a strategy for navigating political uncertainty. Hwang's Right to Start organization is actively working across political divides, launching in-state coalitions in places like Arkansas and Indiana, with plans for expansion into California, Michigan, Missouri, New York and North Carolina. 'We had over a dozen Right to Start Act bills introduced across states with vastly different political leadership,' he said. 'Creating an office of entrepreneurship, tracking entrepreneurs, shifting economic development priorities — all of these are ideas with broad appeal.' Brackeen added that economic development strategies differ by region but ultimately share the same goal. 'Ohio's model is very different from New York's, but at the end of the day, they both want the same thing — thriving businesses,' he said. 'If you strip away the political middleman, it's clear that entrepreneurship is a common ground.' Can local ecosystem builders continue to thrive in an era of political division? Hwang and Brackeen remain optimistic but realistic. 'This is still a bottom-up democracy,' Hwang said. 'Both parties haven't quite figured out how to tap into the energy of entrepreneurship, but the leader who does will have a major political advantage in the coming years.' Policing language is easier than forging connections My favorite social video of the week is from TikTok user @nopebrigade0 who identifies as a sociology PhD candidate and argues two of my favorite points: If you call everything fascism, the word loses meaning, and policing language is often classist virtue signaling. After I published an op-ed critiquing Elon Musk for arrogantly overriding democratic ideals, plenty of readers criticized me for not being critical enough. Following my last column in which I argued that a Trump-championed witch hunt for DEI programs was no less an attack on free speech than mandating DEI language, one friend belittled my writing as daring to equate his political views with those of his political opponent. I find this unproductive. As the social activist Bernice Johnson Reagon, who sadly died last year, put it: 'If you're in a coalition and you're comfortable, you know it's not a broad enough coalition.' It is so much easier to police the language of someone you mostly agree with, than it is to build bridges to someone you mostly disagree with. Better to build a coalition around important issues we can agree on. 'What we need is a narrative of who we are together, who we are as a nation,' as that TikTok user eloquently puts it. 'It can be a big, expansive, wonderful one.' National politics and federal priorities do shape state and local strategies. They did under the Biden administration, and they will under Trump. Activism is necessary, so do call your elected officials and attend town halls. For most of us though,the best path forward remains at the community level. 'People ascribe evilness to the 'other side' without actually knowing them,' Brackeen said. 'But when you focus on real entrepreneurs, real businesses, and real job creation, you can find common ground in any political environment.'
