Insight Into the Strategies and Other Economic Development Professionals are Using to Build Better Economies and Communities.
Most people that know me well understand that I expect to gain something actionable from meetings, retreats, and/or conferences. Meeting simply to meet/network/”get on the same page”/etc. isn’t something that I have a lot of time for. When a colleague of mine invited me to attend the Kauffman EShip Summit, I had some things that I wanted to obtain from two days of participation. Those included:
- An idea of how COVID was impacting like communities, and strategies that work in rural America to combat the negative business impacts.
- Examples of programs that were more inclusive of different types of entrepreneurs from a variety of backgrounds that we could emulate here.
- Economic Development trends from a focus and incentive standpoint to drive community growth, wealth, and modernization.
- Revenue sources to assist with economic transformation projects.
- Sources of energy (we’ve all been a little beaten up over the past few months).
- Data points to reinforce definitive actions.
Virtual conferences aren’t easy, and the folks at the Kauffman Foundation had their hands full hosting people from all over the world. Short burst sessions in a real world environment typically encourage the audience to track down speakers for more in depth conversations. Everything in a twenty minute presentation may look like rainbows and unicorns, but some targeted questions can allow audience members to quickly determine if the subject material is applicable to their communities.
The Kauffman Center handled the difficult transition from “real world” to “virtual simulation” very well. It wasn’t the same as “in real life”, but they did a good job executing a rapid pace with some interactive tools. But, back to my six items that I wanted to obtain; were they made available?
- Covid is having an impact everywhere, and the impacts will persist for the immediate foreseeable future. Different industries are responding with various degrees of “success” (or mitigating damage). Businesses that are embracing technology, adaptively reusing interior/exterior space for different uses, and working cooperatively are seeing some successes, but it’s tough in a lot of places. Some larger communities confirmed movement to smaller communities from the “work from home” crowd.
- Inclusive entrepreneurship was a more difficult conversation. Everyone wanted it. Some communities were doing a better job of diversifying than others, but no one had a “here are the steps to make it happen” guide. Some (more) successful communities talked about the years of service to a variety of populations that didn’t fit the mold of yesterday’s business person. Service over time created trust, and trust created mutual opportunities. Emporia is ahead of some of our peers in certain areas of inclusivity, but we are behind in others. A diverse populace will require the involvement of everyone to make a community function, and there is room for improvement.
- One of my favorite speakers at the virtual conference was Steve Case (former CEO of AOL, tech pioneer, and entrepreneurial investor). Mr. Case works with entrepreneurs all over the nation (and beyond) and he stated that successful economic development efforts were focusing primarily on three areas: 1. An emphasis on starting new businesses (under five people) to drive net job growth and wealth. 2. Building a culture that values entrepreneurs, supports them, and invests in them. 3. Emphasizing collaborative teams that can provide assets and rapid assistance to start and grow ventures.
- As far as revenue sources were concerned, there were a couple of grant opportunities, but monetary resources for capacity building are hard to come by right now (and VERY competitive).
- People were pretty pumped up (sometimes overly so), but I think most of the excitement related to the concept of finally looking forward instead of feeling like you were playing an organizational game of musical chairs while waiting for the music to stop. Regardless of the reason, it was nice to feel a little excitement for the future. That isn’t to say that chat rooms were void of apprehension. Many people talked about “restarting” entrepreneurs after COVID, and how to maintain entrepreneurial support in the interim.
- Inside of the office, I am often accused of lacking emotion in decision making. There is some truth to that. When a lack of clear metrics are a part of any project, people can simply redefine success and move on. If your project was supposed to help entrepreneurs start, how many businesses started? How many jobs were created? What was the economic impact? If your movement was supposed to create housing, how many housing units were created? What was the impact on the population? How did real estate values change? There were some initiatives described in the conference that were VERY averse to any sort of measurable statistic, but most could point to specific data points that allowed a community to show the high points and low points of any strategy. There were a couple of measurement ideas that we will probably roll into future initiatives.
In general terms, there were some unifying strategies that successful regions used to create sustainable growth while modernizing their economies.
- Stay for the long term (strategy investment). Too many community or regional investors look for “quick flip” strategies that are mildly profitable in the short term, but can damage regions in the long term. Strategic investment requires a stair step approach that builds entrepreneurial capacity over time. Younger voices with staying power must generate longer term planning and investment strategies for regional good.
- Get adequate investment. It takes a lot of money to build a solid economy, and those dollars must come from locals with a vested interest in the growth of their region. Undercapitalization leads to underperformance of internal structures, and entrepreneurs that cannot find cash locally will leave in search of dollars elsewhere.
- Hire people that can learn quickly and be hard nosed. You don’t have to be an expert in everything to push economic development, but you must be willing to learn, make tough decisions, and push forward. People in economic development must self motivate to generate success and momentum beyond cheerleading the success of others.
- Create the deal flow to keep economic development structures viable. This point was the toughest for many of the rural communities in the conversation. If you have mechanisms that can fund entrepreneurial startups and expansions, you have to use them consistently. Not every entrepreneurial venture will succeed, so risk mitigation is achieved by spreading risk among a lot of deals. Without the appropriate mechanisms to push a culture of entrepreneurship, rural areas struggle with creating the appropriate volume of deals to keep investment pipelines open.
- Your board, volunteers, and staff have to “get it”. If your leadership doesn’t understand taking calculated risks, pushing entrepreneurial culture to the forefront of economic and community development strategy, and the long term work that it takes to generate positive change, you won’t succeed in improving the regional economy. Achieving economic growth isn’t easy, and you can never be satisfied with the status quo. Constant evolution is needed not only to maintain relevance, but to give your region the opportunity to grow.
- Create directed investment companies. Local investment groups that are targeted in different sectors are critical to community growth. Folks outside the community are happy to swoop in for profit opportunities, but they take those profits with them. It takes longer, and it can be a messier process, but local investment groups should drive targeted investment opportunities.
- Arguments should be about goals, not who is in charge. This one is pretty self explanatory, but it is generally the most difficult part of community growth when people exist in silos. When discussions revolve around the flow chart of “who is in charge” and not “what do we want to get (measurably) accomplished”, a region is in trouble. Set expectations for achievement, and get things done.
- Economic Development should have a neutral ear. Not everyone that wanders into an economic development office has a viable business plan, and you have to be clear with expectations of business assistance, but “weird” ideas that generate income can create scalable growth opportunities. If a revenue generating opportunity presents itself with entrepreneurs willing to put in the work, we owe it to the region to find ways to help.
- Developmental curves take YEARS, but you must create immediate successes to generate progress. Economic development groups aren’t given the luxury to wait until a full realization of a strategic plan to show results. Just because something looks nice on paper doesn’t mean that the public will be patient enough to continue their support over several years. Find smaller tests for your strategic concept, and if the test results come back positive, move so something larger. Small steps lead to big impacts if you continue walking forward.
- Invest in areas where the community is already going forward to start, but then look for new economic spaces for sustainable growth. Rural communities in chat rooms talked about starting investments in areas that were familiar (like value added agriculture, or offshoots of existing businesses). Once the concept of community investing was solidified, investors were more likely to look at concepts outside of the norm for the regional economy.
There were some economic areas where Emporia is moving in the right direction, and some categories we are back sliding. It is important to understand the foundation of success for growing economies instead of simply trying to emulate a singular business within a region or hiring a firm from a neighboring community to homogenize the area. Read through the EShip information above. Where do you think our region is succeeding, and where do you think we are failing? How do you want to get involve to improve our community?