Americans love entrepreneurs.
Politicians of both parties routinely call small businesses “the backbone of our economy.” Plenty of well-known books and movies profile owners of both real-life and fictional companies; on popular TV shows like "Shark Tank," aspiring entrepreneurs compete for money from successful investors. Countless podcasts, master classes and inspirational online talks have been devoted to small businesses and the self-starters who run them.
Indeed, businesses and business owners deserve their spot in the popular consciousness. Most jobs in this country are created by new and young companies. But the reality is that America is in the midst of a 30-year decline in entrepreneurial activity. People may romanticize local businesses and their owners, but according to the Kauffman Foundation, Americans are starting businesses at about half the rate they were a generation ago. And many of the small businesses that do get started remain small.
The economic, political and social forces inhibiting local business launches and job growth are especially acute for entrepreneurs of color. Structural and institutional racism have left a legacy of disconnection from existing business networks and ecosystems. African-American and Hispanic entrepreneurs are less likely to have access to the startup capital needed to launch a business. And access to credit from financial institutions remains elusive.
These disparities mean America today has more than a million fewer businesses -- an estimated 9 million fewer jobs -- and loses out on over $300 billion in income.
Cities understand that creating opportunities for employment and wealth-building is an economic imperative. Fifty-eight percent of mayors highlighted economic development in their 2018 State of the City address, according to the National League of Cities. But relatively few cities have begun the hard work of building a small business and job-creation ecosystem with racial equity at the center.
That's why the newest initiative of the City Accelerator is built around proactively ensuring that growing numbers of entrepreneurs of color are equipped and supported to build tomorrow’s high-growth businesses. After we put out the call for cities to submit their proposals a couple months ago, we received a record number of applications from localities in every corner of the United States.
The unique challenges they highlighted in those applications vary. But they include rapid growth and gentrification that displaces existing businesses and residents; “program rich but results poor” landscapes where services are available but fragmented, siloed and uncoordinated; a lack of trust in organizations—including cities—that have a history of predatory services and discriminatory policies aimed primarily at people of color; lacking access to capital; and inadequate data and tools to measure progress toward goals.
In the coming weeks, we'll select up to five of these cities to participate in the City Accelerator program. Then, over the next year, they'll work to improve their local business support systems and enable more firms to start, grow and create jobs in the communities where they are most needed. The cohort cities will work together to promote the spread of promising practices, to tap into their full potential to create jobs and income for their residents.
Here are the 10 finalists. We invite you to review each of their pitches, and share your thoughts on their potential to expand city innovation and increase economic opportunity:
Atlanta Cleveland El Paso Kansas City Long Beach, Calif. Newark, N.J. New Orleans Rochester, N.Y. Stockton, Calif. Tulsa, Okla. Through their participation in the initiative, selected cities will implement strategies to strengthen existing partnerships and create new ones; map the elements of an inclusive entrepreneurial ecosystem; identify strategies to provide access to credit and capital and develop disaggregated performance measures and data sources to track their outcomes. Teams will also develop their racial equity competencies and work to apply an equity and inclusion lens to all aspects of city-led supports for local business.
Selected cities will receive a combination of coaching, technical assistance and implementation resources over one year. Coaching and technical assistance will be provided by Ascendant Global, a boutique economic development firm focused on providing bold growth solutions to help economies sustain themselves and gain jobs and private investment. Rodrick Miller, a seasoned economic developer who has led major business support and growth efforts in New Orleans and Detroit, will be the lead coach for the cohort.
We want your help in building a network that amplifies and accelerates innovation.
Follow these cities throughout their City Accelerator journey on Governing.com, and join this conversation on social media with the hashtag #CityAccelerator. Ask questions! Share ideas you find important.
Together we can build the practices that create robust and inclusive economies around the country and re-ignite the entrepreneurial spirit in America.