Several cities across the U.S. are seeing success with entrepreneurial ecosystem development efforts thanks to trailblazing mayors like Mayor Lovely A. Warren of Rochester, NY.
Supporting entrepreneurs and early-stage businesses is key to economic mobility, opportunity and growth. But it’s one thing for city leaders to “talk the talk” and quite another to implement a strategy that will spark and sustain entrepreneurship. A report called “Dynamism in Retreat” (Economic Innovation Group, February 2017) stated that, “From 2010 to 2014, just five metro areas—New York, Miami, Los Angeles, Houston and Dallas—produced as big of an increase in businesses as the rest of the nation combined.” In fact, across the rest of the United States the report said many cities were seeing major declines in new business starts. Since then, however, more and more city officials, especially mayors, are embracing the role of “entrepreneurial ecosystem builder,” and are actively working to create—through policies and programs—an environment within their communities that supports entrepreneurship.
Alejandro Manzanares is a program manager with City Innovation Ecosystems (CIE), a program the National League of Cities (NLC) launched in 2018 to aid cities’ entrepreneurial ecosystem-building efforts. More than 100 cities have participated in the first two cohorts. Manzanares said that there is no one-size-fits all approach cities should take when it comes to entrepreneurial development efforts. He encouraged mayors and city officials to get creative about their ecosystem initiatives and to embrace programs and policies that consider the current assets, challenges and opportunities, as well as the dynamics of their specific communities. One thing is clear, though, he said, “Entrepreneurs should be at the center of any entrepreneurial development efforts.” Here’s how the City of Rochester, New York and Baltimore City, Maryland developed an infrastructure to support entrepreneurship—with the mayors of both cities taking the lead.
Rochester, New York: A Lovely Idea
According to census data compiled by ACT Rochester, Rochester ranks third within the 10 poorest cities among the top 75 metropolitan areas in the United States. More specifically, it ranks first among 17 benchmark cities for overall, child and extreme poverty rates. Mayor Lovely A. Warren recognized the need to reverse these trends. In January 2018, at the beginning of her second term in office, Warren launched the Office of Community Wealth Building (OCWB), the second of its kind in the nation. Community wealth building is a “bottom-up” economic development strategy theoretically advanced by the Democracy Collaborative at the University of Maryland in partnership with the Aspen Institute. The OCWB’s original mandate was to develop policies and initiatives that combined existing government programs, the business community, the nonprofit sector and educational institutions to help citizens build personal and community wealth. One of the sectors the plan targeted was small business and entrepreneurship. A goal was to build an ecosystem that supports prospective entrepreneurs and existing small business owners.
Dr. Lomax Campbell, director of the OCWB, said entrepreneurship was targeted because eradicating poverty requires being able to build wealth, especially in a capitalistic society. According to Dr. Campbell, true wealth-building occurs when people can own property, invest in the stock market, or start a business. “There’s not really a lot of other ways to build wealth,” he said. “As a city, it all begins with asking ourselves, do we want more people trying to go take jobs when there aren’t a ton of jobs in the city? Or,do we have to create the businesses in the city that would allow those jobs to exist for people to take. So,the reason entrepreneurship is so important is because as our economy experienced the vacancy through the decline of Kodak, Xerox and Bausch and Lomb,Rochester has had to transition from being a ‘company town’to a ‘town of companies,’as the mayor sometimes says. We want to be mini employers. And we know that the biggest employer of America’s citizens are small businesses.”Dr. Campbell said it made sense for Mayor Warren to lead the initiative because she is “a child of Rochester” who has deep relationships andsocial and cultural capitalwith Rochester’s residents. “When the mayor says this is what’s important to us and this is what we are doing, there’s a significant proportion of our population that believeher,” Dr. Campbell said. “So that credibility and those relationships are important.That network is important.”Previously, he said, Rochester’s entrepreneurial and business support services were fragmented and had operated in silos.Dr. Campbellpointed out that the mayor could reach across all the organizations where there traditionally had been little sharing of goals or data and say:“You all are jockeying to be a part of it. So,sincewe all have a relationship anyway, why don’t we do this together?That’s where the voice of the mayor is so important and why we’re the center of this,”he said.He stressed adopting a collaborative approach is critical when cities consider entrepreneurial ecosystem building.Campbell began a yearlongundertaking of engagingwith Rochester residents, business leaders, and regional stakeholdersabout entrepreneurship and asset building.In April 2019, OCWB obtained approval to reallocate $40,500 in City Acceleratorgrant funds toconduct three “undoing racism” workshops for city staff, community members, andlocal trainers.This decision was essential to addressing the systemic barriersthat had to be addressed if ecosystem efforts were to be viable, Dr. Campbell said. The accelerator initiative helped city officials and other stakeholders gain the insights of minority and women business owners through both surveys and focus groups. “Since the needs of our primary markets are varied, our principal strategy for ensuring their satisfaction is meeting them where they are. This compels us to get to know them in authentic ways,” he said.