Seizing the opportunity to strengthen rural small businesses and entrepreneursNovember 01, 2014
The most difficult opportunity to pinpoint is sometimes the one that’s right in front of you. And in every rural town across the Mississippi River Delta and Alabama Black Belt regions there is an opportunity, namely an economic opportunity, that all of us need to do a better job at seeing: helping small business owners and entrepreneurs access affordable capital.
During the depths of the Great Recession, when large banks were receiving bailouts and multi-national companies were closing stores, small business owners in our region did the opposite – they stayed and kept fighting. During the darkest days, they tightened their belts and continued to work hard to provide goods and services to their neighbors and drive the local economy.
Today, as the national economy begins to turn around and more workers across our region finally obtain the jobs they so desperately want and need, it is an important time for us to continue to help those very same small business owners reap the fruits of the economy they helped save.
The easiest way to accomplish that goal is by helping entrepreneurs access affordable capital to start or expand businesses, especially in the chronically underserved and undercapitalized rural areas of the Delta region.
Let’s be clear: our rural small business owners need greater access to affordable capital. Of the $1.24 billion invested through the U.S. Department of Treasury’s Community Development Financial Institutions in the Delta region from 2003-2012, a mere 20 percent--$251 million—was directed to small businesses through micro-loans. And only 40 percent of those loans was invested in enterprises in rural counties and parishes. Lending institutions rooted in our rural communities do a great job to support some of these businesses, but they need more resources.
We must transform this reality to help our small businesses and rural economies.
The Delta Regional Authority is helping to drive investment into our region. Together with our federal partners, we helped to develop the Delta Community Capital Initiative, which aggregates diverse sources of capital and channels it to community lending organizations in rural Delta counties and parishes. I am encouraged to see the U.S. Department of Housing and Urban Development lead the effort in funding this important program with support from the U.S. Department of Agriculture-Rural Development and CDFI.
But let’s not stop there. We also need to work with our local entrepreneurs to make sure they have the technical assistance and obtain the necessary affordable capital to expand their operations and create good-paying jobs. Small business owners know their industry. They know how to sell their products – even in tough economic times. But they do not always have the tools and knowledge on how to leverage all of the public and private resources available to entrepreneurs.
The Delta Regional Authority is working hard to change that. Together with the U.S. Small Business Administration and their locally-based Small Business Development Centers, we have hosted and will continue to host Meet the Lenders workshops in each of DRA’s eight states. Our goal is clear: connect small business owners and entrepreneurs with U.S. Treasury-supported micro-enterprise lenders in their region – and encourage investments in the process.
We will continue to support community organizations like Operation Jumpstart, based at Southeast Missouri State University, the Mid-South Minority Business Council Continuum in Memphis, Arkansas Regional Innovation Hub in North Little Rock, Idea Village in New Orleans, and small business incubators throughout the region that work hand-in-hand with current small business owners and budding entrepreneurs. These proven support and mentorship efforts work, especially with entrepreneurs in rural parts of our region.
As our nation and communities turn the corner to finally overcome this recession, we must ensure continued growth, especially when it comes to providing access to affordable capital and support services to our small business owners and entrepreneurs. We can see the opportunity before us. Now is the time to double-down on resources and tools and finish the work we have started.