Educational Materials for Rural Entrepreneurship
Jason HendersonCenter for the Study of Rural AmericaFederal Reserve Bank of Kansas Citywww.kansascityfed.org/ruralcenter
Presented to the National Public Policy Education Conference
September 20, 2004St. Louis, Missouri
What is the Center for the Study of Rural America?
• Part of the Federal Reserve System– Monetary policy– Bank regulator– Check and cash clearinghouse
• The Center provides economic analysis and insight into the rural economy.
What makes rural economies grow?What makes rural economies grow?
What Do We Tell Entrepreneurs?
• Entrepreneurship matters.
What Do We Tell Entrepreneurs?
• Entrepreneurship matters.
• Lots of information is available.
Do not reinvent the wheel !!!!!Do not reinvent the wheel !!!!!
What Do We Tell Entrepreneurs?
• Entrepreneurship matters.
• Lots of information is available.
Do not reinvent the wheel !!!!!Do not reinvent the wheel !!!!!
• We do not finance businesses.We do not finance businesses.
Entrepreneurship Matters at the State Level
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
0 1 2 3 4 5 6 7
Proprietors Growth
Wa
ge
an
d S
ala
ry W
ork
er
Gro
wth
Source: Dept. of Commerce, REIS
Annualized percent change
State Proprietor and Employment Growth, (1970 to 2000)
Correlation = 0.74
Entrepreneurship Matters at the Local Level
U.S. Personal Income(by Class of Worker, 2000)
25.229.6
34.938.7
50.6
33.7
0
10
20
30
40
50
60
Private Government Self-Employed
Th
ousa
nd
Dol
lars
Rural Metro
Source: March 2000 Current Population Survey, Dept.of Commerce
Information is Available
The Center’s 2003 Conference
Main Streets of Tomorrow: Growing and Financing Rural Entrepreneurs
1. Entrepreneurs are Made not Born
2. Entrepreneurial Skills Can be Developed– Technical Skills – ability to perform key operations of business
– Managerial Skills – ability to organize and manage the operations
– Entrepreneurial Skills –ability to identify market opportunities
– Personal Maturity Skills – self-awareness, accountability,
emotional and creative development
A Major League System for Entrepreneurial Development
Technical Managerial Entrepre. Personal
Maturity
Major
League:
Outstand./
Exceptional
Outstanding Outstanding Outstanding
AAA: High High High High
AA: High Medium Medium Medium
A: High/
Medium
Low Low Low
Rookie
League
Low/No Low/No Low/No Low/No
Source: Thomas S. Lyons, “Policies for Creating an Entrepreneurial Region”, Main Streets of Tomorrow:Growing and Financing Rural Entrepreneurs, 2003.
A Major League Farm SystemThe A LevelThe A Level
• Skill Levels– Technical Skills: High/Medium– Other Skills: Low/No
• Enterprise Development Assistance Providers– Microenterprise programs– Small business development centers– Business incubation programs
• Weblinks– Association for Enterprise Opportunity:
http://www.microenterpriseworks.org/– Small Business Development Centers
http://www.sba.gov/sbdc/– National Business Incubator Association
http://www.nbia.org/
A Major League Farm SystemThe AA LevelThe AA Level
• Skill Levels– Technical Skills: High– Other Skills: Medium
• Enterprise Development Assistance Providers– Manufacturing extension programs– Small business development centers– High-technology incubation programs– Small specialized venture funds
• Weblinks– Manufacturing Extension Partnerships
http://www.mep.nist.gov/– National Institute of Science and Technology
http://www.nist.gov/– National Association of Seed and Venture Funds
http://www.nasvf.org/– Community Development Venture Capital Alliance
http://www.cdvca.org/
A Major League Farm SystemThe AAA LevelThe AAA Level
• Skill Levels– Technical Skills: High– Other Skills: High
• Enterprise Development Assistance Providers– Angel investors– Emerging Business Consulting practices– University tech transfer offices
• Weblinks– Association of University Technology Managers
http://www.autm.net/index_ie.html– Lists of Angel investors
http://www.entrepreneur.com/http://www.inc.com/guides/finance/24011.htmlhttp://www.minnesotaruralpartners.org/
A Major League Farm System The Major League The Major League
• Skill Levels
– Technical Skills: Outstanding
– Other Skills: Outstanding
• Enterprise Development Assistance Providers
– Venture capitalists
– Professional consulting practices
– Investment bankers
• Beyond my resource level
If they come to you for assistance, If they come to you for assistance, are they really in the majors?are they really in the majors?
Do Not Forget …
• The Scout who looks for prospective entrepreneurs.
• The Diagnostician who assesses the needs of entrepreneurs entering the system.
• The Performance Coach who helps entrepreneurs with mental and emotional needs.
• A Team Manager who brokers networks of firms at the league level.
• Alliance Brokers that facilitate partnerships across league levels.
• A General Manager who oversees the whole farm system.
Conclusions
• Entrepreneurship matters.
• Lots of information is available –Do Not Reinvent The WheelDo Not Reinvent The Wheel.
• Create a farm system that matches information with the skill levels of entrepreneurs.
• Good Luck in Spurring Entrepreneurs – The Pioneers of the 21st Century