The Hunt for an 'Entrepreneurial Ecosystem'

September 26, 2017

Entrepreneurship in America has plummeted by nearly a quarter over the past 40 years, with only a slight increase in new business starts as the economy has recovered from recession. And much of that activity is increasingly concentrated in a handful of cities. The dominance of online retailers, chain stores and mega-corporations is partly to blame for snuffing out all those aspiring coffee-shop proprietors, drug-store owners, and mom-and-pop retailers, as well as the smaller, U.S.-based producers who struggle to satisfy the output and price demands of retail giants. This is true across many industries and every community—from farms to the urban core.

In communities suffering from persistent crime and poverty, new business creation even less dynamic. The number of minority- and woman-owned businesses is always lower than overall entrepreneurship; the country’s free falling rates of new businesses have hit those communities hardest. The Census Bureau examined entrepreneurship for the first time last year and found that less than 20 percent of small businesses were minority-owned, and African-American-owned businesses made up just 11 percent of that total—a sliver of a sliver of all startups in the country. While minority and women-owned businesses saw gains in 2015, they were marginal compared to entrepreneurship overall. The neighborhoods suffering most from disinvestment and stagnant business growth are likely half female, and primarily black or Latino. “Those are the demographics that are least in the funnel right now,” Gaskin says.

That’s the trick, he says: convincing sources of capital to invest in troubled areas, without the government mandating it. His neighborhood has everything it needs, Dixon says—history, vacant land, the support of the city and developers. Entrepreneurship can take off here—if someone can just put the pieces together.

Read more here:The Hunt for an 'Entrepreneurial Ecosystem'