Transcript The Case for Economic Gardening [email protected] High Entrepreneurship Rates Mean  Better growth for existing firms!  73% better employment growth  14% higher.

The Case for Economic Gardening
[email protected]
High Entrepreneurship Rates Mean
 Better growth for existing firms!
 73% better employment growth
 14% higher wage growth
 45% higher productivity
Source: Center for Rural Entrepreneurship
www.ruraleship.org - Based on a study of the 90’s by
Edwin Lowe Foundation &SBA
Do small businesses matter?
 Fortune 500 jobs declining, but large
 Small and medium create jobs, but larger
businesses employ a lot – including high tech.
 See http://smallbiztrends.com/2010/08/do-smallbusinesses-matter-in-high-tech.html
 This scholar criticizes helping small business?
 Kauffman Foundation on jobs creation
 http://www.kauffman.org/uploadedFiles/firm_formation_importance_
of_startups.pdf
Kauffman on Job Creation
Small Business vs Entrepreneurship
See Scott Shane. The Illusions of Entrepreneurship, YYP, 2008
 Most small businesses fail
 Most are started in unpromising industries with
which the founders are familiar
 Most have little (i.e. insufficent) financial capital
from family and friend sources
 Most founders want “to be their own boss”, but
reality is they get more “bosses”
 BUT- most small businesses are not entrepreneurial!
What is an entrepreneurial
venture?
 K. Allen (in Launching New Ventures) says they are



Innovative
Value-creating
Growth -oriented
 AND they can occur as new organizations or within
existing ones.
Sustainable Ventures
The Timmons Model
 Opportunity driven
 By a lead entrepreneur and entrepreneurial team.
 Resource parsimonious and creative
 Depends upon fit and balance
 Are integrated and holistic

See http://blacksgonegeek.org/Documents/Timmons%20Modelv3.pdf
Requirements for Entrepreneurial Action
 Evidence of current customer value
 A sound business model
 An effective team with the right skills
 Resources – at least one of which can produce
sustainable competitive advantage (SCA)
 i.e. rare, valuable, hard to copy or find substitutes
Lessons of Littleton, CO
Christian Gibbons-Director, Business/Industry Affairs
www.littletongov.org/bia/economicgardening/
To stimulate development of high growth business
(gazelles), communities should provide:
 Information- Knowledge is the basis of 21st century wealth.
 Infrastructure -Physical, Quality of Life & Intellectual
 Connections -Academic institutions, trade groups, etc.
 Littleton doubled jobs & spent no money on incentives or tax breaks.
They grew their own new business.
So what should we do?
 START on the things you need!
 Information like access to school, agricultural
extension and library sources!!!
 Infrastructure – EDUCATION, broad band & wireless,
bike paths, nature areas, youth centers
 Connections - universities, government, investors,
SBDC, former residents and most importantly – other
entrepreneurs!!!
Some other thoughts
 Technology is important, but it is about GROWTH,
not technology
 Manufacturing is different, not dying.
 Assess resources and opportunities – i.e., ENGAGE IN
ENTREPRENEURIAL ACTION!!!
 Cultivate diversity!
 FEAR the fear of failure!
 CHANGE can be good!