Entrepreneurship in States: Fostering a Startup-Friendly Economy
Bottom Line: One overlooked way that state policymakers can revitalize regional economies is by pursuing strategies that prioritize entrepreneurship such as making it easier to bring products and services to market. Such a focus on entrepreneurship can help local economies overcome regional economic challenges such as growing global competition, vocational barriers, and lagging rural areas.
There is latent entrepreneurialism in young adults disconnected from the workforce, mid-career adults, retirees, and parents. Governors can develop these entrepreneurial resources by setting an entrepreneurship vision and touting their states' entrepreneurial attributes. Real leadership comes from the state level. States are incubators of innovation. As one state prioritizes entrepreneurship and reaps the benefits, other states will follow suit.
Contrast this local entrepreneurship approach with the time, energy, and resources that were wasted on trying to attract one big business: Amazon. These efforts would have been far more rewarding if focused on developing entrepreneurship at the local level.
Governors serve as the connective tissue for entrepreneurial venturing in their states. As the state leader and CEO, the governor is uniquely positioned to coordinate with stakeholders both across and beyond the state to elevate entrepreneurial opportunities and bring together public resources with private investment. Other roles include providing the financial amenities that entrepreneurs need, such as government-supported small business loans and venture capital, making the state’s regulatory and tax environments competitive, and working to ensuring adequate broadband infrastructure.
Since entrepreneurship occurs in “ecosystems” — locations such as cities and regions with connected resources that help entrepreneurs navigate — it helps when governors coordinate and connect their state’s entrepreneurial ecosystems into a statewide “mega ecosystem” so that the networks can learn from each other. Exemplary strategies addressed in this report include:
- Capitalizing on current national initiatives such as the Rise of the Rest tour and Kauffman Foundation’s Zero Barriers movement.
- Taking the pulse of a state’s ecosystem.
- Establishing a long-term vision based on state assets.
- Providing financial amenities.
- Making a state’s regulatory environment competitive.
- Understanding the importance of broadband.
- Finding entrepreneurs in underserved communities.
- Supporting comprehensive rural programming.
- Using the governor’s bully pulpit to praise the state’s ecosystem and entrepreneurs.
- Aligning diverse interests such as corporate, philanthropic, nonprofit and educational resources.
- Catalyzing networking events in state and beyond the state, regionally and internationally.
A variety of states are putting entrepreneurship at the top of their economic agendas. State examples explored in the report include:
- Colorado’s multi-year data gathering that surveys entrepreneurs' priorities.
- Montana’s leveraging its natural and outdoors assets.
- Tennessee’s long-term approach fostering collaborations that benefit both rural and urban Tennesseans.
- West Virginia’s Jobs Investment Trust program that operated three credit support programs and a venture capital program.
- Pennsylvania’s Business One-Stop Shop to simplify the regulatory process for entrepreneurs.
- New York’s state broadband initiative to expand broadband access.
- Maryland’s Opportunity Zone strategy to incentivize entrepreneurship in underserved areas.
- North Carolina’s approach to serving rural areas such as the North Carolina Rural Center that helps startups in rural parts of the state.
Whether an entrepreneur has the idea and team to found a fast-growing globally-traded “unicorn” company or be a main-street business, governors can work to create environments for both of these opportunities to unfold
Read the full study HERE.
- Colorado has learned how to quantify several important aspects of the state’s regional entrepreneurial ecosystems.
- The data enables the state to determine how entrepreneurs decide whether it is “worth it” to start a business in their community.
- The survey findings empower decision-makers to maximize the community’s value by focusing scarce resources on the greatest opportunities for entrepreneurs.
- This is just one example of how governors can help revitalize regional economies by prioritizing entrepreneurship.
Read the full study HERE.