A national study shows how trust, local partnerships and support for homegrown entrepreneurs can build lasting economic resilience.
What helps a rural community build new businesses, new jobs, and strengthen their local economy?
A new national study suggests that the answer is close to home.
Commissioned by The Ford Family Foundation, Growing from Within explores how rural communities across the country are strengthening their economies by supporting local entrepreneurs.
Based on interviews with people from rural communities of all sizes, researchers found that the most resilient and successful efforts weren’t built around a single program or funding source. They were built around trust, local partnerships and a shared belief that local people already hold the solutions their communities need.
That lesson is made clear through a story from Klamath Falls, Oregon. More than a decade ago, a group of community leaders came together to address a rising question: How could they create opportunities for local entrepreneurs to succeed?
Efforts originally started as an agreement between leaders to read a single book on growing entrepreneurial communities. This gave parties a shared understanding to build from, and it eventually became Klamath IDEA (Inspire Development – Energize Acceleration), an organization dedicated to helping connect business owners and aspiring entrepreneurs with the resources they need to succeed. Today, Klamath IDEA coordinates a network of 35 partner organizations and serves as a hub for entrepreneurship in the region.
Klamath IDEA executive director, Darin Rutledge, helps present the Entrepreneurship-in-Action Award at the Oregon Institute of Technology.
Community success stories like these display the power of entrepreneurial ecosystems, the support networks that help people start and grow their businesses, particularly ones formed in rural communities. These ecosystems are a proven driver of economic resilience, but studies of their impact have focused on large cities where resources are more easily accessible.
Themes for success
Because of their different contexts, rural communities approach this work in ways that respond to their opportunities, resources, and constraints with creativity and persistence. Even with very diverse approaches to building their ecosystems, five major themes appeared throughout the study.
1. Trust is foundational.
Trust serves as the basis for effective partnerships. It is built over years and can be lost quickly. When trust fails in rural communities, the impact is significant. With more overlapping professional and personal relationships in small communities, there are more chances to build this foundation but also to lose it.
2. Partnerships often form around a catalyst.
In the face of a crisis or a new opportunity, communities naturally pull together. These events drive organizations out of silos and into collaboration to support their communities.
3. Required metrics miss what matters most.
Traditional measurements of success do not account for the most important ecosystem impacts. For rural ecosystem builders, tracking quality of engagement with clients interested in starting or growing a business, community progress, and leadership growth were all identified as impacts of this work that mattered as much or more than traditional economic development metrics.
4. Funding fragility is widespread.
No matter the level of funding an organization had, communities continued to hold concerns about the sustainability of their resources. Those that developed more stable funding approaches had diversified revenue streams over time.
5. Internal growth orientation matters.
Every community has people with ideas, skills, and entrepreneurial potential. When communities placed more effort into supporting these local businesses rather than recruiting outside employers, they found an increase in long-term success followed.
Along with these findings, the report provides a number of strategies and recommendations for communities, policymakers, and funders looking to consider as they work to improve rural entrepreneurial ecosystems. When communities are given the support and connections they need, they can become the foundation for long-term economic resilience.
Through the stories of these 18 community practitioners, pathways emerge for rural communities to develop their ecosystem. These pathways are interconnected parts of a system, not simply individual choices to make. These may not be easy or quick, and as the report states; “there are no silver bullets.” But communities who are willing to nurture the potential of their own people will find that each person holds the potential to become a trailblazer—to lead others in their community to new places.