Starting businesses should be a community priority amid COVID-19

Starting businesses should be a community priority amid COVID-19
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America’s economic debate has been too narrow, focused primarily on reopening businesses, as if they’re just waiting to turn the lights back on. It’s urgent that we focus more broadly on helping people to start businesses and making that a community priority nationwide. 

The brave act of starting a business is often viewed as a solitary entrepreneurial endeavor. Think of the myth of the lone starter in a basement or garage. But the reality is different. Starting a business takes the help of many, and communities can facilitate the process. Every community can make starting businesses a civic and policy priority and thereby lift its economic prospects.

The timing never has been more important. The damage to businesses is deep. The COVID-19 pandemic has shut down an estimated 3.3 million U.S. businesses — more than one in five. Stunningly, 41 percent of Black-owned businesses have closed. Some of those businesses will reopen, but many will not. Yet our nation needs new businesses to provide missing goods and services and to diversify supply chains. Even in a pandemic, entrepreneurial activity happens in many forms — whether running a delivery service, preparing food to go, or making new products or services to sell online. We must make it easy for people to adjust and adapt to the new reality.

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The need for communities to prioritize entrepreneurship predates the pandemic. At the start of 2020, the United States already was struggling with growing inequality, stagnant wages, and deep pessimism and division. In subsequent months, racial injustices nationwide have been laid bare, and those injustices are integrally linked to economic opportunity. 

To overcome the challenge, helping people start businesses should become a civic and policy priority. It literally can enhance every community in America. You don’t need to have a major university or an incubator nearby. You don’t need to be college-educated. You don’t need to be in a large metropolis. You just need a fair chance to pursue your dream — with access to opportunity, capital, know-how and support. You can start with what you have, where you are.

Unfortunately, many barriers exist for people starting businesses. But we can identify those obstacles and clear a path for everyone to access equitable entrepreneurial opportunity.

To create a level playing field and less red tape, for example, we should eliminate startup costs, cut tax hassles, and dedicate government contracts to young businesses. To expand know-how to start businesses, we should expand access to entrepreneurial learning through local providers and libraries. To democratize the ability to take risks, we should make health care more portable and defer student loan payments. To equalize access to needed capital everywhere, we should expand capital for young businesses, spur local financial innovation, and make fundraising easier. 

Some of these changes require federal policy action; others, state or local action. But citizens can influence all those levels of government and can act locally to engage their civic communities.

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There are many ways to get involved. One can identify barriers to local entrepreneurs and alert elected officials to change policies. One can support programs and services where aspiring entrepreneurs can gather, seek advice, and make needed connections. For example, 1 Million Cups, founded by the Kauffman Foundation, is in over 160 communities — including many running virtual events now — and new communities can apply to join.

Every community starts with local assets. Everywhere there are talented people waiting to be asked to help. America has more than 300 community colleges that promote entrepreneurial learning, and there certainly are more willing out of 1,462 nationwide. Citizens can engage, connect and activate entrepreneurial resources to impact local economies.

At the simplest level, every citizen can help in two easy ways. First, tell elected officials that starting businesses should be a policy priority in their communities. Second, give every budding entrepreneur a chance. When a new business opens, try it. If you don’t like the product, you don’t have to buy it again, but at least you gave the business a chance.

Because of the importance of starting businesses to every community, I have engaged leaders across America to launch a national movement called Right to Start. Our vision is to transform the nation, so all communities provide entrepreneurial opportunity by embracing the right to start, clearing away obstacles, and creating a level playing field on which to compete and grow.

Entrepreneurial opportunity is not a simple light switch, but it provides the spark we need to rebuild. The pandemic has underscored the urgency. The unfolding election season will define our priorities as a nation for years to come. Candidates, elected officials and civic leaders need to hear that Americans prioritize starting businesses as a path forward. That message will resonate to the benefit of every community in the nation — and the aspiring starters within them. 

By lifting our starters, we will lift our communities. By lifting communities, we will lift our nation. 

Victor Hwang is founder and CEO of Right to Start, a campaign to rebuild the American economy by putting entrepreneurs first. He previously was vice president of the Kauffman Foundation.