Creating Systems for Entrepreneur Support

by Erik R. Pages, President, EntreWorks Consulting

Consider the following hypothetical phone conversation:

Aspiring Entrepreneur: “I’m interested in getting information and support for starting a new business.”

Economic Developer: “Our program doesn’t provide such support, but if you call this other office, they should be able to help you out.”

This conversation occurs frequently in economic development offices. After concluding this call, most economic developers would be pleased that they were able to network the entrepreneur with a needed resource. But what really happens to the entrepreneur after this referral? In some cases, the referral works, but in most instances, the network breaks down. The entrepreneur fails to follow up, the suggested contact information is wrong, or, most commonly, the suggested organization also doesn’t offer what the entrepreneur needs and she receives yet another referral. In most cases, the entrepreneur gives up and reports that “I tried to get help, but they just gave me the run-around.”

This vignette captures one of the primary challenges facing entrepreneur support programs: how can service providers effectively target and serve the specific needs of a diverse group of local entrepreneurs? A whole range of small business and entrepreneur support programs are in place across the United States, yet entrepreneurs complain that such services are difficult to access and don’t effectively meet their needs. What’s the problem? It is not that specific programs (e.g. financing) aren’t correctly designed; it is that such programs exist within a crazy quilt of programs, initiatives and support efforts. Entrepreneurs don’t know how to access these programs, and the programs themselves are not user-friendly.

Existing support services could be significantly improved if their user-friendliness could be enhanced. One of the best means for doing so is to create local or regional systems of entrepreneur support. This essay offers suggestions on how to create such systems. It begins by reviewing shortcomings of the current system, and then suggests how regions can build a truly effective entrepreneur support system.

Current challenges: What do entrepreneurs want?

Most American communities do not suffer from a shortage of small business support providers. Indeed, most regions have dozens of such organizations, ranging from small business development centers to microloan programs to revolving loan funds to numerous private sector sources. When confronted with such a wide array of supports, entrepreneurs are often bewildered and uncertain where to begin. As a result, they often fail to access the type and depth of assistance they need. A recent study for the North Carolina Rural Economic Development Center summarizes the challenge:

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