Entrepreneurs and the Creative Rural Economy

By Mary Mathews, President & CEO, Entrepreneur Fund

Anna Anderson and Elizabeth Chapman are typical rural entrepreneurs: that is, they are completely unique. Sisters in their early 30s, they joined their father’s business five years ago in Angora, Minnesota (population: 277). Today, Art Unlimited is a dynamic and growing interactive media solutions, web design, marketing solutions, and graphic design company.

Well before joining the family business, Anna and Elizabeth demonstrated their entrepreneurial spirit. When they were 12 and 13, the sisters wanted animals. Their parents told them that they would need to raise the money to pay for animal feed. The girls wrote a business plan for a boarding kennel and a dog-food distribution business and won a national business plan competition. They then convinced a local bank to make them an $8,000 business loan--without their parents co-signing for the note. Elizabeth still runs the boarding kennel.

I met Anna and Elizabeth at one of the Entrepreneur Fund's “Be Strategic: Grow Your Business” series. During the eight-session, six-month “Be Strategic” series, the sisters clarified Art Unlimited’s company vision, developed a strategic plan for growth, and improved their skills in marketing, finance and operations. They are expanding their customer base into regional and national markets. They are clear about who their customer is and the value Art Unlimited provides. Now they are using the planning tools acquired in “Be Strategic” to help their clients clarify their own vision and strategy. They are adding three new high-quality jobs to their six-person company to facilitate their growth.



At the "Be Strategic" series graduation,
with Anna Anderson and Elizabeth Chapman (two at left)
and Mary Mathews (far right).

 After 30 years of working in rural development, I still regularly ask myself how we can accelerate the growth of our rural economies. How do we create more opportunities for our young people to stay in northeastern Minnesota and northwestern Wisconsin or move back to raise their families?

I believe that the answer lies with skilled rural entrepreneurs. Of course, investments in broadband, workforce education, infrastructure, and capital are critical components of rural development. But entrepreneurs are the ones who are capable of growing strong local companies, building regional wealth, and creating jobs. And they are tomorrow’s community leaders.

Helping Rural Entrepreneurs Succeed

Even for individuals with strong entrepreneurial instincts, skill development improves the opportunity for business success. Since 1989, the Entrepreneur Fund has worked in Minnesota and Wisconsin to identify, guide, and support local entrepreneurs that have drive and ideas. We work to accelerate their skills development and overcome barriers to their growth.

After four years of regional planning, in 2008 the Entrepreneur Fund launched the Greenstone Group initiative to build an organized, intentional system of entrepreneur support for northeastern Minnesota and northwestern Wisconsin. This initiative targets entrepreneurs who have been in business at least two years and have a vision and desire to grow their companies.

In 2003, the Entrepreneur Fund helped Don and Leanne Negley start Rural Living Environments (RLE), in Babbitt, Minnesota. The company specializes in creating supportive living environments for adults with developmental disabilities in a rural setting. We helped them with the initial business plan and start-up financing. Later, a Greenstone Group Business Performance Coach helped Don grow the company. RLE employs 40 people and Don has plans for additional growth.

We have developed and tested tools and activities to guide entrepreneurs toward growth and to measure the resulting changes in their entrepreneurial skills. All Greenstone activities, whether one-on-one or group, share common elements. We believe that entrepreneurs learn best from other entrepreneurs, so we:

• provide networking opportunities,
• build peer-learning groups among entrepreneurs at similar levels of development, and
• include skilled, experienced entrepreneurs in every activity, as coaches and guides to accelerate and enhance the learning that occurs.

In addition, we work collaboratively with other public and private service providers to ensure the entrepreneur has the resources and support s/he needs. 
 
The Entrepreneur Fund also works to support diverse business ownership in the region. For example, our Women’s Business Center hosted its first three-day Women’s Strategy Weekend (WSW) in March. Ten women with existing companies refined their vision and developed strategic plans to grow their companies. 
 

As a result of her participation in WSW,
Art in the Alley's owner plans to expand to several more locations.
Pictured: Tami LaPole Edmunds (owner at right) and her daughter Gwen LaPole

 
Our Vision and Track Record
 
The Entrepreneur Fund’s long-term vision is of a regional culture where being an entrepreneur is an equal choice to getting a job, where young people can chose to stay in rural communities because they see creative opportunities for starting companies or finding jobs, and where the process of entrepreneurial thinking and business cycles are understood. Success is celebrated and a failure is learned from…and the process of creation goes on. 
 
Formerly the Northeast Entrepreneur Fund, the Entrepreneur Fund's development services have helped entrepreneurs start or grow over 1,300 companies since its formation in 1989. It $8 million loan fund has provided $15 million in loans to 450 companies. The Entrepreneur Fund is the developer of the CORE FOUR Business Planning Course® and Be Strategic: Grow Your Business. 
 
The Greenstone Group has so far worked with 150 entrepreneurs running companies with annual revenues ranging from $20,000 to $10 million. Their companies have increased profitability, grown revenues, and found new markets.
 
 
More about the Entrepreneur Fund
 
The Entrepreneur Fund's mission is to develop skilled entrepreneurs who build strong locally-owned companies in northeastern Minnesota and northwestern Wisconsin. We envision a strong regional economy with an entrepreneurial culture that cultivates thriving companies and vibrant communities.
 
The Entrepreneur Fund launched the Greenstone Group in 2008 with visionary support and a 10-year grant from the John S & James L Knight Foundation.
 
 
About the Author
 
Mary Mathews is a social entrepreneur and the founding president of the Entrepreneur Fund. She is a past board chair of the Opportunity Finance Network and Association for Enterprise Opportunity and a current board member of the Duluth Art Institute and NorthStar Aerospace. Mary is a northeastern Minnesota native, former business owner, and an Iowa State University graduate.
 
 
Photos provided by the author.

A Way Home: Creating Pathways with Community Internships

By Darryl Birkenfeld, Director, Ogallala Commons

We are all on a journey that leads to destinations that we cannot foresee. Navigating the twists and turns of the roads that a person travels to arrive at a home requires mentoring and experience. Community Internships can be an effective tool to meet such requirements, enabling towns and neighborhoods to be proactive in connecting their assets and challenges with new generations of seekers.

In 2002, after 30 years away, I moved back to the Texas village where I grew up. While I was fulfilling my dream of living “back where I came from,” I returned to my hometown without a job in hand.

Thanks to contacts and mentors that I met in my former career, I found my way into nonprofit work, as Director of Ogallala Commons. I am amazed at how my current occupation fits my skills and passions, even though I could not see it on the horizon in earlier years.

At Ogallala Commons, our broad mission is to reinvigorate communities overlying the High Plains-Ogallala Aquifer as well as the vast Great Plains region. That work has led us to creating our Community Internship program. Our hope is that the connections the young interns create now may help them find a meaningful place in their home communities or region in the future.

The High Plains-Ogallala Aquifer reaches across parts of eight

Great Plains states and comprises the work area of Ogallala Commons.

 

Even the idea for our Community Internships started with the creativity and energy of a young person from our region. In 2007, a high school graduate from western Kansas community asked to do an internship with Ogallala Commons. We didn’t have an internship program at the time, but the experience of creating one opened a new door for our organization.

As we worked with those first interns, we recognized that most students seek an internship in their college years. An epiphany occurred. Instead of sending youth away to do internships, why not build a program where students and adults could intern in their hometowns or neighborhoods, applying their passion and skills to projects that could benefit communities?

As of 2012, Ogallala Commons has created more than 100 Community Internships in 38 communities and six states (Nebraska, Kansas, Colorado, Texas, New Mexico, and Oklahoma). We have partnered with towns, institutions, and businesses. Currently, we are working on launching 40 new Community Internships.

After six years, we can see that our internships have played a large role in helping people find pathways to their new home. Let’s refer back to the young intern from western Kansas. She went on to complete two more Community Internships, plus an internship with her Congressman during her senior year in college. In 2011, she took a job as Economic Development Director for Wichita County, Kansas. While not exactly back in her hometown, she is just two counties away, already making a huge contribution to western Kansas.

Ogallala Commons counts 13 other Community Interns who are either back in their hometowns, or a community that they choose to live in. An internship wasn’t the only reason for their choices, but it did create a vital pathway that might not have otherwise existed.

With the age and education levels of interns ranging from sophomores in high school to college and all the way to graduate students or adults looking to build skills, a flexible program is essential. Community Internships range from 200 to 240 hours, and can be structured over a period lasting four to 10 weeks. Some of our internships are also carried out over a semester, or during a six-month period.

Though all our interns follow a common structure, each internship is uniquely tailored to what the partners, interns, and their communities need. As a result, candidates with diverse socio-economic and educational backgrounds have gained experiences in:

• community development and leadership,
• entrepreneurship,
• historical preservation,
• nonprofit outreach,
• agricultural careers,
• health care,
• renewable energy,
• social networking, and
• rebuilding local food systems.

Not every Community Internship has been a success. Some falter or are not fully completed due to limitations that arise with regard to three essential components of a Community Internship: a capable supervisor, an adequate set of projects, and a qualified intern.

Ogallala Commons Community Interns at their 2011 Orientation

Ultimately, the success of our program depends on how our partners answer these questions:

• What does my community or neighborhood need that an intern could readily address with their skills and desire to learn?
• Would I or an organization I represent be willing to invest financially and/or provide supervision for an internship?
• Is there a young person or adult that I can identify and that I would personally invite to consider applying for a community internship?

About the program

Visit our Community Interns page to learn more about our Community Internship Program, or to read blogs and see photos of what interns have accomplished in past years. Building such a large program takes significant financial resources. Ogallala Commons has been fortunate to receive annual funding from CHS Foundation, the major giving entity of CHS, an energy, grains and foods company with a stewardship focus of building vibrant communities. In addition to program support, CHS Foundation also provides match funding to leverage investments made by partners.

About the author

Darryl Birkenfeld completed a Ph.D. in social ethics from The Graduate Theological Union and the University of California in Berkeley. As Director of Ogallala Commons, he has worked extensively in youth engagement and entrepreneurship, rebuilding local and regional food systems, public education conferences, water education, and creating a Community Internship program. Darryl resides in Nazareth, TX, and has been married to Joann Starr since 2003. Together they built a home, Casa La Entereza, using many green construction techniques, such as solar electricity generation, energy efficient construction materials, rainwater collection, and xeric landscaping. You can contact him at: darrylb@amaonline.com.

 

Photos and images provided by the author.

 

 

Visit the Rural Futures Lab homepage here.

Making Rural Matter

By Shanna Ratner, Principal, Yellow Wood Associates

When I started Yellow Wood Associates in 1985, it was with the idea of that the world would be a better place if rural people were able to act as effective stewards of the natural resources that surround them and be rewarded for it.  That led us to specialize in natural resource-based community economic development.

Over 26 years, we've discovered lots of barriers to effective local stewardship, especially for poor rural communities. Resources are often owned and controlled by external forces. Local people lack information about the quantity, quality and potential of the resources surrounding them. Policies and regulations don't support local engagement. Training in stewardship approaches is not readily available. Management expertise is lacking. Market forces encourage exploitation of people and resources.

Today, as we struggle to cope with climate change, population growth, increased effective global demand for goods and services, and instability caused by over reliance on fossil fuels, the need for new approaches to stewardship of natural resources has become even more evident.

Flickr.com: CarbonNYC

Increasingly, here in the United States, we are beginning to imagine regional solutions; however "regional” is too often taken to mean “metro and adjacent counties” when really it should mean metro, suburban and rural areas. Why? Because cities depend (and could increasingly depend) for clean air, clean water, food, fiber, recreation, labor, renewable energy, and markets for urban goods and services on rural areas. New York City understood this when it chose to invest in improved resource stewardship in the (rural) Catskills, its source of clean water, rather than in a water filtration plant within the city limits. New York City recognized that it is much less costly to protect water quality at the source, by investing in the infrastructure, training, public education, and innovation required to support rural people in changing their behaviors to benefit an entire region, than it is to restore water quality once it has degraded. New York City's investment in the Catskills isn't charity; it's an investment made with the clear expectation of a tangible return in the form of clean water.

We now know that the process of industrialization has resulted in significant exploitation and degradation of the natural (and human) resource base. Bringing these resources (soil, water, air, wetlands, croplands, forestlands, lakes, streams, pollinators, etc.) back to a productive state in which they can help meet the needs of entire regions, will require intentional investment in rural areas that increases the capacity of rural people to restore, manage, and sustain these resources for the benefit of entire regions. We also need to invest in new resource management approaches to available renewable resources.  Ultimately, rural resources cannot be “protected” for the benefit of metro and suburban areas without engaging rural people in their protection and development in ways that are mutually beneficial. If we continue to separate rural development from regional development, we are likely to continue unsustainable patterns of rural resource exploitation.

How can we join hands with consumers and decision-makers in urban and suburban areas to identify new opportunities to funnel investment that sticks in rural areas for the benefit of entire regions? If we can answer this question, we can begin to overcome the rural/urban divide and create allies among our urban friends. As they recognize the value to their own communities of investing in the productive and innovative capacity of rural places, together we can speak truth to power with a force beyond what rural America can hope to achieve by organizing within its own ranks.

Shanna Ratner is the Principal of Yellow Wood Associates, which is the managing grantee for the Wealth Creation in Rural Communities initiative of the Ford Foundation. 

How are Rural and Urban Linked?

By Brian Dabson, Director, Rural Futures Lab

Much of what passes for policy discussion around place-based strategies tends to emphasize the differences between urban and rural, often to the detriment of rural people and places.  To a great extent this is the result of the unsatisfactory way urban and rural places are defined, as described in Kathy Miller’s blog, The Quandary of Defining Rural (September 12, 2011).  It is also an outcome of a general lack of awareness of the contribution that rural America makes to the overall prosperity and well-being of the nation as a whole. 

A potentially fruitful way of reframing the discussion is to focus on the linkages between urban and rural people and places to better understand the nature and strength of their interdependence.  This was one of the important topics for discussion at the recent Rural Wealth Creation and Livelihoods conference in Washington DC sponsored by the Economic Research Service and the Ford Foundation.  The particular mechanisms favored by Ford for exploring these linkages are value chains. These, as defined by USAID, refer to the full range of activities and services that are required to bring a product or service from its inception to sale in its final markets, whether local, national or global.  They include input suppliers, producers, processors and buyers and are supported by a range of technical, business and financial providers. 

US Secretary of Agriculture, Tom Vilsack

at the Rural Wealth Creation and Livelihoods Conference

Analyzing value chains helps to focus on the linkages and relationships among firms, on where power is exercised, and on where different links are located – urban, rural, or suburban.  When at the depth of the Great Recession the auto industry began to retrench, the impacts were not just felt in the Detroit region but also along complex chains of suppliers and retailers that extended into small towns across the rural Midwest and beyond.  There, small manufacturers and service operations experienced first-hand the strength of urban-rural linkages and who controlled the value chain. 

There is much scholarly work underway across the world dedicated to better understanding rural-urban linkages, particularly in the context of rapid urbanization.  In the US the focus has been on industrial and employment clusters and on the economic benefits of agglomeration in growing city regions. 

The Rural Futures Lab is currently working with the Ford Foundation-supported Wealth Creation in Rural Communities initiative on a series of case studies of rural-urban linkages and their impact on rural wealth creation.  We are studying linkages in wind energy in Texas, food systems on the Gulf Coast, bio-manufacturing in Nebraska, and forestry and forest products in Oregon, to better understand the spatial dimensions of linkages within these value chains.  Of particular interest to the initiative will be the extent to which it is possible to measure the impacts of these value chains on the accumulation or depletion of capital – whether individual, social, intellectual, natural, built, political or financial – in rural regions and communities.

If you have insights, studies, and initiatives that you think would enrich our study, please share them with us.  We would very much like to hear from you.

To visit Rural Futures, Lab click here

Photo Credit

The Quandary of Defining Rural

By Kathy Miller, RUPRI Program Director

What is rural? It sounds like a simple question, but ask 10 people and you’ll get 10 answers. Worse, ask 10 policymakers and you’re likely to get 20 answers. What makes this such a contentious and difficult dilemma? Largely, it falls to where the funds are – everyone wants a piece of an ever diminishing source of public funds for rural development.

Common rural definitions & their challenges

There are lots of ways that rural is defined for data-related purposes. The Census Bureau makes the official definitions of the words “urban” and “rural.” These are based on the population density of census blocks and block groups. Under these guidelines, urban areas have populations of 2,500 and higher, and anything not defined as urban is rural.

While the Census definitions are the official designations of rural and urban places, these pose significant problems for the purposes of targeting resources to rural areas. Many people argue that some “urban” places – such as small towns with as few as 2,500 people – are really more rural in character. But how do we agree on the appropriate threshold? Also, these areas are drawn for the purposes of statistical tabulations – there is no governmental jurisdiction that operates these census-defined areas. Furthermore, these are boundaries that are delineated only once per decade.

The Office of Management and Budget (OMB), recognizing these challenges, created the Core Based Statistical Area classification, designed to represent “functional regions” around urban areas. Counties are used as the basis of these areas. Counties are classified as:

·         Metropolitan, a county with a core urban area of population 50,000 or more plus surrounding counties linked through commuting ties;

·         Micropolitan, a county with a core urban area of population 10,000 to 49,999 plus surrounding counties linked through commuting ties; and

·         Noncore counties, the residual set of counties that don’t meet the criteria for metropolitan or micropolitan.

These OMB definitions are popular designations, and do indeed have strong merit. However, counties create a difficult geography to classify, particularly in the west where counties can be expansive. It is very difficult to classify a county as one thing – counties are not urban or rural, they are urban and rural. In fact, over half of all rural people actually reside in counties that are classified as metropolitan. And an image of the Grand Canyon, located in a metropolitan county, is often used to illustrate this challenge.

Thinking regionally

While it is absurd to call the Grand Canyon an urban area, this classification does have significant merit when considering more regional approaches to economic development. OMB does not intend for these designations to be utilized as strict delineations, but rather as functional regions. By definition, these areas contain a broad spectrum of territory, from the most urban to remote rural places.

Micropolitan areas in particular represent small cities and towns that act as important regional growth hubs for broad rural territory that surround them. We should not dismiss these designations because they are county based, but we should embrace these designations for their purpose, representing how regions interact and functions.

Most would agree that we rarely cross an invisible line where urban territory becomes rural territory – a drive outward from a central city will present a gradual change. Thus represents the problem. Rural and urban are a continuum – not discrete concepts. We are forcing a line in the sand when we create a firm definition of rural. The truth is, there will always be some place left just beyond the arbitrary line we draw.

The answer, then? Ultimately, there isn’t one – nor will there ever be. But in an area of declining public resources and monumental challenges, we need to worry less about who is rural and who isn’t – for these places are no more isolated in reality than the definitions try to make them. Communities need to recognize, and welcome, the interrelationships with surrounding areas and learn to function as regions.

How do you define “rural”? What is your community's experience with various qualifying criteria for rural programs? How do you define the region where you live? 

Kathy Miller is the Program Director for RUPRI. When she’s not wrestling with rural data issues, she raises chickens, turkeys, and cows with the help of her two girls and husband in Blackwater, Missouri. Contact her at miller@rupri.org.

Visit the Rural Futures Lab at our website.