37m Rural & Small Town Startups
This number is derived from US Census data that shows rural and small-town communities have a combined population of 67+ million adults between the ages of 18-64 (19.3% of all Americans)—combined with data from the 2013 Global Entrepreneurship Monitor (GEM) that showed that 56% of adults believe that they have the capabilities to start a business.
But less than 100,000 of the 37,000,000 actually do take the step into business each year. There is no shortage of business ideas, but many of those who have them just do not know where to start.
Knowledge and Knowhow
So, where does one of these 37 million people go for help? Anywhere they can. What kind of help do people look for?
- Finance: Capital–there are not many business angels or venture capitalists in the countryside, but that hardly matters because only 16,000 (out of about 500,000) startups get seed money from angels every year–about 3%. Angel List, though lets you search for angels by location. Less than 1% of startups get VC money (about 500 a year), so that source is probably not for you. Most rural startups are small scale and relatively few will have huge growth prospects. Debt–the advantage for rural business is that community banks and other local financial institutions like credit unions and savings & loans are themselves small and more accessible for loans. In addition more and more sources of finance are realizing that small-town startups are often a good bet. If you write to me, I will send you a list of sources that go out of their way to fund rural business.
- Networking: Country and small-town people are less likely to find business incubators & accelerators than their urban counterparts. They many have access to a small business development center (SBDC), I don’t know of any that actually organize a community of would-be entrepreneurs. When I started way back when, I had to go looking for like minded people, and it was not easy. There are a few local online communities, often sponsored by universities. This is a gap that Google for Entrepreneursis trying to fill. OnStartups is another initiative that you might try, but these places lack the face-to-face opportunities to hang out casually and learn from others facing the same dilemmas as you.
- Ecosystem: There are a growing number of communities where there is a real attempt to develop and encourage an entrepreneurial mentality. Two nonprofit examples of this are StartupBozeman (Montana, pop 40K) that is dedicated to proving that building amazing companies and living in an amazing place are not mutually exclusive; hotDesks (Eastern Shore counties of Maryland) that offers a network of coworking spaces, entrepreneur and innovation training, and access to capital for high-growth, scalable startup and growth businesses.
- Resources: There is a pretty level playing field for out-of-town entrepreneurs. The internet now provides easy access to resources and apps (often free) are as accessible to them as to people in cities. Physical resources, like offices, shops and manufacturing space is often available at much lower cost to those outside cities, actually giving them an advantage. As an example, in Brattleboro, Vermont (pop 12K), the Development Corporation has a wonderful set of properties available: two former factories split into small business spaces and other commercial property to rent.
- Education: Here too, the internet is available everywhere and startup educational material is vast and growing. I am an MBA teacher (using a blended learning model–residencies and online), but the real growth is coming from the online learning model. A good example at the graduate level is the UNC MBA, but there are short high quality programs and many are free. take a look at The Lean Launch Pad, a free 1 month course with Steve Blank on Udacity. Another example is the University of Maryland’s Developing Innovative Ideas for New Companies: The First Step in Entrepreneurship, a six-week program on Coursera, although this one costs $455. There are many free sources, too. Curiosity.com is one example and there’s a Bussiness section. Kahn Academy has an Entrepreneurship section.
- Services: The two main services sought by entrepreneurs are legal and accounting. While there are plenty of attorneys and CPAs in small towns, they may not always be firms that have sensitivity to a startup with virtually no money. They are professional firms that earn their living from billing hours of work, rather than partnering with entrepreneurs. In almost all cases I tell people to use online options. Docracy is the web’s only open (free) collection of legal contracts and the best way to negotiate and sign documents online, for example.
- Mentoring: Finding a mentor is best done organically, from among the experienced entrepreneurs you know or can find. I naturally get to be asked by former students of my New Venture Creation course to mentor them. They have seen me at work and listened to many answers to the questions they pose. Others find me via the Startup Owl website. They make an initial contact and we get to know each other through early discussions of their issues. Sometimes one of my many contacts will recommend me. You can use a similar process.
Your Own Startup Mentor
If you want to try me out as a startup mentor, please first spend time on Startup Owl to see if what I say resonates with you. Then make an initial approach by email and we can test each other out to see if we are a good fit. I don’t charge anything for the initial interactions. When we are comfortable with each other and have mutual trust, then we will agree how we’ll work together and for how long. With an agreed schedule, most likely we will contract on the basis of a 1% royalty on sales for the first 24 months, from the day your startup opens for business.