The latest ecosystem research is replete with disheartening data on how the pandemic is hurting small businesses. According to a survey of over 8,000 small business owners conducted between March and April 2020, 60% of respondents indicated that they laid off at least one employee, and 31% of respondents thought they had a 50% chance of going bankrupt in the next 6 months. A study from May 2020 found that while an estimated 17% of white-owned businesses closed due to the pandemic, a staggering 41% of Black-owned businesses closed. These long-standing but suddenly erupting, unequal impacts fueled swift ecosystem building efforts in response. We have witnessed this firsthand as a grantee of the Kauffman Foundation for the ESHIP Communities initiative.
Local ecosystem builders, entrepreneurs, and organizations championing them co-create small business support networks in their community. Whether through individual or collective efforts, these networks provide essential support to local business owners amidst the pandemic. The communities we work with, Baltimore, Kansas City, Long Beach, and the North-Central region of New Mexico, demonstrate the dedication and energy required to advance more equitable entrepreneurial ecosystems. It is important that we as partners recognize their hard work.
Our own research can contextualize and support their efforts by capturing a localized understanding of their unique community through tools such as the Entrepreneur Support Organization questionnaire and Survey of Entrepreneurs. In addition to our surveys, we leverage publicly available data to help tell a full story about entrepreneurship in a city. This story underscores the vitality and value of the deep contextual knowledge of those who comprise and support the local ecosystem. Looking at three of our ESHIP Communities, it’s evident how community engagement can drive business survival in ways highlighted by the various data sources we’ve created or examined. Below we connect the data available to us to the stories of some of our partners in three ESHIP Communities.
Kenny Vo (left), owner of Galaxy Pharmacy and Monorom Neth (right) of
Midtown Business Improvement District in Long Beach | Photo credit Midtown Business Improvement District
ESHIP Long beach
SHIP Long Beach engages small business leaders from the grassroots in an effort to grow connectivity, collective impact, and community alignment in support of the City of Long Beach Economic Development Blueprint, including its goals for economic inclusion and entrepreneurship. The pandemic hit business owners hard in Long Beach, where a survey of small businesses from early April 2020 found that 94% of Long Beach businesses experienced a decline in revenue. About 54% of respondents applied for the first round of the Paycheck Protection Program (PPP) but didn’t receive funds, and another 30% didn’t even know about the program. One of our partners addressed these awareness and application challenges in their local business area by partnering with another local organization.
The United Cambodian Community (UCC), in partnership with Midtown Business Improvement District, acted quickly amidst the crisis to serve small business owners. To combat the above challenges they conducted individualized outreach regarding the latest business regulations and guided small business owners through funding applications, including the PPP. This work demonstrates a honed ability across two hyper-local ESOs to anticipate and combat potential barriers to a subset of the ecosystem’s entrepreneurs.
Our research on ESO collaborations in Long Beach tells us that diverse leadership is linked to partnership success. Our ESO questionnaire from February 2020 found that ESOs whose leadership was predominantly composed of people of color were more likely to report successful collaboration between organizations. While 0% of white-led organizations indicated that collaborations were “very” or “completely” successful, 50% of organizations led by people of color indicated that level of success. The UCC-Midtown Business Improvement District partnership highlights the need for and value of collaborations such as those examined through our local ESO questionnaire.
ESHIP Rio Grande
(Bernalillo, Los Alamos, Rio Arriba, Santa Fe, and Sandoval Counties, NM)
Leaders across five counties as a part of the ESHIP Rio Grande initiative strive to increase food and agricultural entrepreneurial capacity and equitable access to local food for New Mexicans. The work is initially focused across a geographic area that includes Bernalillo, Los Alamos, Rio Arriba, Santa Fe, and Sandoval counties, NM. Amongst the ESHIP Rio Grande council are policy advocates working to create broad systems change to localize the food system.
The New Mexico Food & Agriculture Policy Council is a longstanding network of stakeholders advocating for local food entrepreneurs prior to and throughout the pandemic. Their work is much needed. According to Forward Cities’ calculations using the Census Bureau’s County Business Patterns dataset, between 2012 and 2017 food industry businesses across the ESHIP Rio Grande region grew more slowly than in the broader United States. While the nation’s food industries grew by 8%, the region grew by about 6 percent.
Zuni Public School District honored for winning the "Seeding the Future Award". Representatives of Zuni Public Schools and New Mexico Public Education Department at Food and Farms Day 2020 at the New Mexico State Legislature. | Photo by Seth Rothman of Green Fire Times
The Policy Council excels at prioritizing local producers and distributors by passing legislation to grow local food business. Their advocacy work helped pass $150,000 for the Department of Agriculture to create market opportunities for food and agricultural entrepreneurs. Publicly available data can serve as a guidepost for ecosystem building and underscore the much needed policy work conducted by entities such as the Policy Council.
Rowdy Orb.it leading the future Internet Connectivity worker-cooperative in Cherry Hill and Sandtown-Winchester in Baltimore | Photo by JJ McQueen
ESHIP BALTIMORE
ESHIP Baltimore engages entrepreneurs and community leaders in a collective effort to cultivate the creativity, innovation, and leadership of Black Baltimore as a model for thriving equitable entrepreneurial ecosystems of the future. The work of the local council is focused on the development of a culturally grounded ecosystem model that prioritizes the assets and leadership within the Black community, with the support of allied partners.
In Baltimore, one ESHIP council member increases access to online information to promote community development in under-connected neighborhoods. Our research indicates that there is a need for improved access points to information for entrepreneurs. A survey of entrepreneurs jointly launched by Forward Cities and NORC at the University of Chicago from February 2020 indicates discrimination hinders successful information sharing at ESOs.
Among aspiring entrepreneurs and existing small business owners in Baltimore, Forward Cities found that 56% of Black respondents experienced discrimination at ESOs compared to just 26% of white respondents. This gap in experience may reduce the amount of information and support that Black entrepreneurs receive; a problem that ESHIP Baltimore council member Jonathan Moore’s work can address.
Understanding these long-standing challenges, leaders on the ESHIP Baltimore council have created information access points where there previously were few. Jonathan Moore of Rowdy Orb.it installed community-based, free internet in Sandtown Winchester and Cherry Hill, two of Baltimore’s most digitally disconnected communities. While internet access cannot override institutionalized racial bias, it can offer communities a different access point to information.
While data can paint a bleak picture, these and many other contributors to local ecosystems provide a more hopeful future. Supporters and innovators, such as those highlighted above, exemplify how to reach all entrepreneurs in an ecosystem. The entrepreneurs in these and other communities have brilliant ideas, and yet institutional and resource barriers often create barriers on their path, as demonstrated by Forward Cities’ research. The stories of the ecosystem supporters above show how deep community knowledge is the cornerstone to these initiatives and leads to their success.