This article was originally published by Arkansas Money & Politics and written by Erica Sweeney
For an entrepreneur to be successful, he or she needs a champion. In the Mississippi Delta region, those champions are needed more than ever.
Enter the Delta Entrepreneurship Network, a program under the federal Delta Regional Authority’s Small Business & Entrepreneurship Initiative.
DEN, headquartered in Clarksdale, Mississippi, with a Washington, D.C. office, launched in 2015 to provide a variety of resources and support to entrepreneurs located in Arkansas and seven surrounding Delta states, as well as to organizations that provide free or low-cost help to entrepreneurs.
“One of the best ways to revitalize rural America is through entrepreneurship,” said Chris Masingill, DRA federal co-chair.
The Entrepreneurship Network also provides a competitive fellowship competition for entrepreneurs, said Katie Milligan, the agency’s director of small business and entrepreneurship.
“As we get together, we’re starting to see where the service gaps are in Arkansas and around the region,” she said. “I can’t brag enough on our support organizations that have stepped up to the plate. It’s that sense of wanting to help and continue to push Arkansas to be a very competitive state in this space.”
Masingill said DEN is about creating jobs, building communities improving lives in the Delta, and helping female and minority entrepreneurs overcome barriers.
“We know we’re making a difference in people’s lives and communities,” he said. “We have the ability. This is about lifting up people and communities. It’s also about changing the dynamic. I will always be an advocate for rural America.”
Masingill and Milligan, both Arkansas natives and based in Little Rock, say they travel throughout the Delta about 75 percent of the time and enjoy meeting entrepreneurs passionate about their work.
AMP spoke to Masingill and Milligan about the Delta Entrepreneurship Network and how it is serving Arkansas and other parts of the Delta.
AMP: What is the Delta Entrepreneurship Network?
Masingill: It is our key program that touches small businesses and it’s under the Small Business and Entrepreneurship [Initiative]. For the Delta Entrepreneurship Network, it was our way of lifting up and highlighting the focus for the region for helping to build, to grow, to harness this entrepreneurship ecosystem in the region. In rural America, in the Delta region particularly, we need to double down on helping existing small businesses grow. We also need to do more about building this support system, this ecosystem. When I say “ecosystem,” I’m talking about everything that it takes to take someone from A to Z in the course of this process.
Under [SB&E], we wanted to increase the number of skilled and educated entrepreneurs. Secondly, we wanted to leverage technology and innovation. How do we connect small businesses and entrepreneurs to that? We recognize that you have to get access to capital. We know that there are issues with accessing capital in rural America. We wanted to make sure we increase the awareness of market opportunities. How do we bring in more of the information for entrepreneurs to really understand the markets that they’re trying to tap into? Lastly, we know that there are regulatory barriers for [certain] small businesses.
Milligan: In a practical sense, we have the overall SB&E initiative. Within that, our entire branch of it is the Delta Entrepreneurship Network. Within that, we do have multiple things going on. One of which is a competitive fellowship program for entrepreneurs and ESOs [entrepreneurship support organizations]. Those support organizations are any nonprofit or individual that’s providing free or low-cost services for entrepreneurs. The fellowship runs from fall to spring and [we gave] these entrepreneurs an opportunity to pitch their companies as well as talk about the ecosystem at New Orleans Entrepreneur Week [March 11-18]. We have a three-year partnership with the Idea Village, which is an accelerator/incubator based in New Orleans.
It’s a way to build the ecosystem, but it’s also a celebration that innovation and entrepreneurship is happening here in the Delta. We want to talk about it and want to make sure other people know about it.
New Orleans Entrepreneur Week is quickly becoming the premier place for entrepreneurs to talk about their ideas. Last year, they had more than 14,000 people at the event. What the DEN is really doing is providing an access point that these entrepreneurs wouldn’t get otherwise. Traditionally, New Orleans Entrepreneur Week has been closed to entrepreneurs outside Orleans Parish. So you have this incredible nationally recognized event, and there wasn’t a way to access it. That’s what the DEN aims to do. We have 22 entrepreneurs in this second cohort and 13 support organizations from around our eight states. We’ve served just over 50 entrepreneurs in the two years that we’ve been doing this.
AMP: Why is it so important for this program to exist in the Delta?
Masingill: The reason we’re doing this is to provide opportunities that people in our part of the world wouldn’t normally have access to. Let’s remember, the excitement that’s happening around entrepreneurship in Little Rock and central Arkansas is still very young. We’re still in the infancy stage of this. It is still extremely new. People say you can’t do that in rural America but you absolutely can. As an economic developer, we need to be integrating, building up entrepreneurship as a part of our economic development strategy. We need to be as aggressive with someone wanting to start a business as we are with recruiting a business.
It’s not about taking the same size pie and splitting it up into more slices. It’s about making the pie bigger. I believe, fundamentally, that innovation and entrepreneurship can be a key economic development strategy for our rural community, just like it can for Little Rock and central Arkansas.
Milligan: The Delta is inherently innovative. Entrepreneurs and small businesses have been overcoming struggles since people moved to the Mississippi River Valley. It’s a natural fit that entrepreneurs are coming out of the Delta because they’re looking at [how to solve a problem in the community]. They really want to solve problems that they’re facing, or overcome a challenge or provide a service or product that is going to do something. That’s important. What I’ve heard over and over with these entrepreneurs is “I would never have had this opportunity.” A lot of it is just about building confidence. One of the things that we can’t measure is the confidence that we instill in our entrepreneurs who then go on and do all of these other things because we have said, “You have a good idea and we’re going to help you get there,” wherever “there” is.
Masingill: This is a long game. We’re investing for the future. We’re investing for 10, 20, 30 years from now. We want to institutionalize the idea that entrepreneurship and innovation can be just as strong as traditional business retention and expansion projects right alongside traditional economic development. This is how you keep your innovation; this is how you keep your young people. This is how you attract more because it is a place-based strategy.
AMP: What are some specific programs of the network that help entrepreneurs?
Masingill: Our No. 1 focus is to support, through investing in the infrastructure — the ecosystem. What that means is building an environment where this idea about entrepreneurship and innovation can grow and be supported and be anchored, such as investing in physical infrastructure, as we did with the Innovation Hub. They are providing services, programming, and creating that onramp for the type of services that it takes to be successful. Everything from the initial vetting of your idea to technical assistance and mentorships and how do you get in front of investors. You’ve got to support those programs.
The Venture Center is another great partner. Supporting not only the physical infrastructure but also the programming that draws more entrepreneurs into the pipeline. That’s No. 1. No. 2 is actually creating opportunities for the ESOs because for us the ESOs are critical. We’ve got to support those; we’ve got to support the accelerators, the incubators, the shared workspaces. Then, it’s how can we link opportunities for entrepreneurs.
For us, it’s not investing in the actual business idea. We can’t necessarily do that. We create the environment for that. The fellowship is one specific example of how we do that. We’re looking to identify the entrepreneurs; we’re looking to connect the entrepreneurs; we’re looking to nurture the entrepreneurs and support organizations. We’re looking to grow the entrepreneurs.
Milligan: We’ve looked at branding and marketing, business development, investment — things like term sheet negotiations, investments, how much equity is too much to give up — getting pitches ready. Can you pitch in 60 sections? Can you pitch in three minutes? Can you pitch in seven minutes in a very formal setting?
What we saw is really good feedback. Even though we think these entrepreneurs are in a certain place, they’re all so willing to learn. That’s been one of the great things about both cohorts. None have typical founder syndrome where they’re too good to participate.
AMP: What are the criteria for taking part in the fellowship?
Milligan: We identify the entrepreneurs through a three-minute pitch competition. Applications open up in the fall. We’ll host the pitch competitions in the fall throughout [the region]. Entrepreneurs have to have under $1 million in revenue, have five or less employees, and be living or working within the 252 counties and parishes in the DRA footprint. It’s not industry-specific. For ESOs, it’s any individual or nonprofit that is providing free or low-cost services to entrepreneurs in the footprint.
AMP: How does Arkansas’ entrepreneurship ecosystem compare to the other states in the region?
Masingill: What’s happening in central Arkansas is extremely exciting. We’ve been building the foundation for that for the last decade and a half. This is not overnight. It takes a lot of resources up front. What we’re talking about is the ability for people to take risks without the fear of not being able to get back up and start again.
Arkansas is a great place to start a business. It’s a great place for business to thrive. The key to that is you have to continue to stoke the fire. We need more angel investors. We need more early-stage funding opportunities. Often, that requires public policymakers, elected officials, and community leaders to step forward to see that because the private sector doesn’t always do the best upfront.
AMP: What is still needed in this region to continue the growth and development of entrepreneurship?
Masingill: Access to capital, especially early-stage capital.
Milligan: Education for both entrepreneurs and investors. Pitching to investors is really scary for a lot of entrepreneurs. How do we debunk the myths, and how do we make sure our entrepreneurs are educated and well-prepared? Developing that pipeline of very skilled entrepreneurs so when it’s time to pitch for that early-stage capital, they’re really ready.
Masingill: There has to be a very intentional, elevated strategy to focus in on our women and minority entrepreneurs. The fact of it is, there are additional barriers that they have to overcome. Part of that is financial literacy, understanding business in general, having access to those types of resources, and recognizing that we have to do more to prepare them. This is also about revitalization. The [Delta region] is one of the most underserved and impoverished regions in the country.
One of the best ways to revitalize rural America is through entrepreneurship. In order to do that, you’ve got to make sure people have hope, by creating opportunities.
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