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Inner City Exchange
ICIC's daily blog featuring opinions and commentary from leaders and practitioners in the field on all things related to cities and urban businesses.
Looking for Global Entrepreneurs Who Want to Build a Smarter Planet
ICIC’s stated mission is to “drive economic prosperity in America's inner cities through private sector investment to create jobs, income and wealth for local residents.” In achieving our mission, we partner with some of the country’s most innovative companies to help businesses grow and revitalize their communities in the process. Today, we’d like to highlight IBM’s SmartCamp program, a high-powered attempt to identify and mentor young companies aligned with IBM’s larger Smarter Planet vision.
What is IBM Smarter Planet?
IBM’s Smarter Planet initiative is an ambitious attempt by one of the world’s foremost technology companies to infuse global data intelligence into the systems and processes that make the world work – things no one would recognize as computers like cars, appliances, roadways, power grids, clothes, even natural systems such as agriculture and waterways. The program is built off the idea that the world is becoming more instrumented, more interconnected, and more intelligent and that IBM’s expertise should be brought to bear for the benefit of humanity in pursuit of those tenets. SmartCamp, conducted in 15 countries so far, is a key part of the initiative.
BY Sathya Vijayakumar on May 16th, 2012
TAGS: small business | business | cities | jobs | community development | entrepreneur | shared value | capital | ibm | smartplanet
Fast-Growth CEOs: Bullish on the Economy
shutterstock images
by Kimberly Weisul is Editor-at-Large for Inc.
At a recent gathering of fast-growing inner-city companies, the consensus was clear: We’re back. Manufacturing is back. Things are getting better.
Granted, these are all companies being recognized for their fast growth. But many of them are in industries that also give them a bead on how the larger economy is doing.
The one CEO who said he wasn’t sure which way the economy was headed was Jeff Silver, CEO of Coyote Logistics. Shrugging, Jeff says he doesn’t know what’s going on with the economy “any more than the guys on Squawk Box.” But ask how many employees his company has, and he replies, “1,025 today; 1,040 by Monday.” Revenues were $750 million last year, up from $328 million the year before.
Read the full article at Inc.com
BY Guest Blogger on May 15th, 2012
TAGS: small business | business | economic development | jobs | economy | detroit | manufacturing | entrepreneur
Introducing the 2012 100 Fastest-Growing Urban Businesses In America
BY Sathya Vijayakumar on May 10th, 2012
TAGS: business | entrepreneur | ic100 | #ic100 | workforce | growth | inner city | small business | community impact
Tick, Tock. Tick, Tock. Less than 24 Hours Until the Inner City 100 Symposium!
(avg: 1.00 of 5)
One hundred entrepreneurs are descending upon Boston today in preparation for the Inner City 100 Symposium which is now less than 24 hours away! In preparation for the event, below is a crash course on the Inner City 100 program. In its 14th year, the Inner City 100 list has highlighted the 100 fastest-growing inner city companies in America. Built on the premise that the inner city provides unique competitive advantages such as access to skilled labor, transportation systems, and urban clusters, the Inner City 100 list recognizes firms for the critical role they play in urban communities as both employers and community builders. The 720 companies that have earned a place on the list since the program’s inception have consistently exploded stereotypes of the inner city – this year’s list is no different!
2012 Inner City 100
The 100 companies on the list collectively created over 4,600 jobs over the last 5 years and employ nearly 8,000 workers even as the broader economy has faltered.
How crucial were they to inner city employment and local government coffers? We found that 40% of their workers reside in inner city communities and that they logged a combined $1.5 BILLION in revenues in 2010. Despite chronic undercapitalization relative to their non-urban peers, the Inner City 100 winners actually grew their revenues, on average, 577% between 2006 and 2010—a truly stunning feat.
BY Sathya Vijayakumar on May 8th, 2012
TAGS: small business | cities | business | entrepreneur | ic100 | capital | food | job training | social enterprise
5 Tips for Revitalizing Inner City Commercial Corridors
(avg: 4.00 of 5)
Back in March, we joined hundreds of community development practitioners in Chicago for the “Getting it Done II” conference hosted by the Institute for Comprehensive Community Development. Several roundtables and workshops allowed participants to dig deeper in to their particular community development interests.
For me, that landed me in the commercial corridor workshop. I learned how San Diego is using “Tastes of” neighborhoods to bring together diverse populations and celebrate cultures. I heard how, despite significant housing improvements in West Baltimore, attracting retails remains a challenge. And I listened as Matthew Thrall detailed the plans for the Fairmont / Indigo transit line in Boston that will hopefully revitalize portions of Boston’s low-income communities.
Building off the learnings from the workshop, the Institute for Comprehensive Community Development recently put together a brief “how-to” guide for upgrading you local commercial corridor.
BY Amanda Maher on May 7th, 2012
TAGS: institute ccd | commercial corridors | economic development | community development | businesses | small business | urban revitalization
Skills Gap or Wage Gap?
(avg: 5.00 of 5)
Just yesterday, the stock market surged with news that U.S. manufacturing sector expanded yet again in April and is now at its highest level in 10 months. The day before, ABC News ran a story about the numbner of global manufacturing companies reshoring their operations in American cities and towns. There's no doubt manufacturing will be at the forefront of America's economic recovery.
But repeatedly, we're hearing that there's a skills gap between workers and the employees these manufacturing companies need. In this guest blog from Stacey Wagner of the Manufacturing Extension Partnership (MEP), she explores whether it's really a skills gap that's hindering manufacturing's growth--or a wage gap.
By Stacey Wagner, originally posted on the Manufacturing Innovation Blog
Reading my way through my IndustryWeek online magazines last week, I noticed two articles that, taken together, sounded funny to me, although I was not amused. The first was a piece entitled “Job Shops Need Marketing, Skilled Workers to Grow” and the second was called “How Much Do U.S. Production Workers Make?”. Thinking both of these articles would describe how the continued resurgence of American manufacturing was creating and filling plenty of good jobs, I read through the first article to find that 78 percent of small manufacturers surveyed by MFG.com said they are optimistic about sales and profits for 2012 even though “one of their greatest challenges is finding skilled employees”. The second article, then, didn’t make sense. It said the median weekly income for U.S. production workers dropped 2.5 percent this year from the same period in 2011.
Could it be that people who would be good candidates for manufacturing training and jobs are not seeing wages commensurate with the jobs (and thus, choose a different type of job)? That small manufacturers are having trouble finding workers because they aren’t willing to pay market wages?
BY Guest Blogger on May 2nd, 2012
TAGS: manufacturing | industrial | wages | workforce | workforce training | economic recovery | mep | jobs | skills gap | stem
Building Bridges to Jobs and Safer Inner City Neighborhoods
(avg: 5.00 of 5)
Late last month, the American Journal of Public Health found that low-income neighborhoods have the most dangerous roads. The impact? Low-income residents are more apt to suffer from traffic-related injuries than their wealthier counterparts.
Pedestrians in low-income neighborhoods are six times more likely to be injured than pedestrians in higher-income neighborhoods. Motorists and cyclists are at risk in these areas, too: these drivers were 4.3 and 3.9 times more likely to be injured, respectively.
Researchers explained the reason for the discrepancy is because low-income residents are exposed to more traffic, and with increased traffic comes more accidents. The authors wrote, “Traffic volume at intersections increased significantly with poverty.” Specifically, low-income neighborhoods have 2.4 times the traffic volume than higher-income neighborhoods. Low-income neighborhoods are also more likely to contain complex intersections, such as congested four-way stops and major arterials.
In addition to having worse traffic and poor road design, ICIC’s research shows that low-income neighborhoods also suffer from a disinvestment in infrastructure.
BY Amanda Maher on May 1st, 2012
TAGS: cities | economic development | jobs | safety | infrastructure | bridge quality | research | community health
Growing the Economy Through Food: Inner City 100 food companies
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Maybe you’ve noticed. If there’s one thing we love here at ICIC it’s food. Pizza, cupcakes and sweet potato fries are among our favorites. Sure, we have a passion for urban economic development and supporting small businesses. But we really love food. As luck would have it, our love and passions aren’t mutually exclusive.
In last week’s What Works webinar, experts outlined the complexity of the food cluster, the opportunities for job growth and business development within the cluster, and the challenges that hinder the growth of the food cluster. Over 100 practitioners joined us to learn which tools and policy levers can be used to make food a component their urban economic development strategies.
Through the webinar, we learned that the food cluster – from packaging to machinery, through distribution, processing, and retail – is comprised mostly of small businesses. Over 40% of all companies in the food cluster have between 1 and 4 employees; another 50% of companies employ between 5 and 49 people. In total, the food cluster employs nearly 14 million people, or 12% of the entire U.S. population.
The 2012 Inner City 100 list confirms that food cluster businesses are also among the fastest growing inner city firms. Interestingly, these small food companies represent a range of functions within the food cluster, including a distributor, manufacturer, and restaurant. Quite different than the urban agriculture firms or food trucks that most people associate with the emerging food cluster!
Here’s a preview of food companies that made this year’s cut:
BY Alex Rodriguez on April 26th, 2012
TAGS: ic100 | food | cluster | small business | entrepreneur | business | bronx | new haven | salt lake city
Peace, Love & Happiness in Your City
(avg: 3.50 of 5)
New England states like Maine, Vermont and New Hampshire might get poked fun at now and then for being too hipster, outdoorsy or NRA-loving – but maybe these states are on to something.
The annual United States Peace Index was just released and it has these three states listed as the top three most peaceful states in which to live. The three least peaceful states? Nevada (48), Tennessee (49) and Louisiana (50).
Rankings are determined based upon five factors: the number of homicides per 100,000 people, number of violent crimes, incarceration rate, number of police employees and availability of small arms.
The good news: the survey shows that nationwide, there has been a 3.2% drop in homicides and 5.5% dip in violent crimes over the past two decades. This is important because the economic impact of crime is huge—it cost the nation’s economy approximately $460 billion last year alone. Costs include loss of productivity and state compensation for medical care for victims. A reduction in crime would funnel these resources to most productive uses.
BY Amanda Maher on April 25th, 2012
TAGS: cities | crime | police | peaceful | index | cambridge | seattle | twin cities | detroit | new orleans | nashville | baltimore
Beyond Urban Farming and Rooftop Gardens: The Complexity of the Food Cluster
(avg: 3.67 of 5)
Above: Eastern Market in Detroit
It seems as though everywhere we turn, we hear stories about new urban farms or rooftop gardens atop city buildings. Food-related business incubators are churning out more than just jellies and jams: they’re spinning off new small businesses that then go on to hire local residents.
And yet, as much as we hear about the growth of the “food cluster” – few of us really understand the complexity of it.
Last week, ICIC hosted its second What Works Webinar on “How to Cultivate Your City’s Food Cluster.” To preface the conversation, Karen Karp, President of Karp Resources, began with an overview of the food cluster taxonomy—showing how both federal and local policies have implications for the food cluster.
Some fast facts about the food cluster:
- It’s a major segment of the U.S. economy: more than 700,000 U.S. food establishments (9%) employ nearly 14 million people (12%)
- There’s a high concentration of small businesses: Over 40% of all companies in the food cluster have between 1-4 employees; another 50% of companies have between 5-49.
- Low-educational requirements make it an attractive sector in inner cities: 60% of cluster workers have high school diplomas or less versus 44% for the rest of the economy.
Using a Detroit versus Boston case study, Adina Astor of Next Street and Teresa Lynch of ICIC then highlighted the challenges and opportunities faced by cities seeking to develop an inner city food cluster strategy.
BY Amanda Maher on April 24th, 2012
TAGS: food | what works | webinar | economic development | cities | small business | boston | detroit | clusters | industrial | production | distribution | nextstreet | karp resources
On Earth Day, a Look at Cities Across the World Going Green
(avg: 4.00 of 5)
The 1970s: a decade that saw the Vietnam War, growing disillusion of government, The Kent State Massacre, advances in civil rights, The Rolling Stones, mood rings, and the introduction of affirmative action.
Amidst political upheaval and turmoil, though advocacy and protests, the environmental movement was born. At the forefront of this movement was the celebration of “Earth Day” – April 22, 1970.
In honor of Earth Day’s 42nd birthday today, we’re taking a look at some of the efforts cities are taking to promote sustainability.
- Reykjavik, Iceland: Heat and electricity come entirely from renewable geothermal and hydropower sources. The city is committed to become entirely fossil-fuel-free by 2050. Recently, the city began using hydrogen buses to meet this goal.
- Curitiba, Brazil: Nearly 75% of residents use public transportation daily in this city—using a bus system that is regarded as one of the world’s best
- Austin, Texas: Perhaps the solar manufacturing capital of the U.S., Austin is on its way to achieving its ambitious goal of being carbon neutral by 2020.
BY Amanda Maher on April 22nd, 2012
TAGS: cities | earth day | sustainability | chicago | seattle | vancouver | portland
Caine's Arcade
This short film was created by Nirvan, a filmmaker interested in new-media, collaboration, and social change. By chance he came across an amazing 9 year old boy in a used autobody parts store. Nirvan was able to use his film background to help tell this boy's story. It's an inspiring story about youth entrepreneurship and community development.
Backstory
Written by Nirvan and found on cainesarcade.com
Caine Monroy is a 9-year old boy who spent his summer vacation building an elaborate DIY cardboard arcade in his dad’s used auto parts store.
Caine dreamed of the day he would have lots of customers visit his arcade, and he spent months preparing everything, perfecting the game design, making displays for the prizes, designing elaborate security systems, and hand labeling paper-lunch-gift-bags. However, his dad’s autoparts store (located in an industrial part of East LA) gets almost zero foot traffic, so Caine’s chances of getting a customer were very small, and the few walk in customers that came through were always in too much of a hurry to get their auto part to play Caine’s Arcade. But Caine never gave up.
One day, by chance, I walked into Smart Parts Auto looking for a used door handle for my ’96 Corolla. What I found was an elaborate handmade cardboard arcade manned by a young boy who asked if I would like to play. I asked Caine how it worked and he told me that for $1 I could get two turns, or for $2 I could get a Fun Pass with 500 turns. I got the Fun Pass.
Talk about an inspiring story.
BY Mary Duggan on April 20th, 2012
TAGS: small business | business | entrepreneur | innovation | inspiration | community development
When Innovation Outpaces Policy: Amazon, Sales and Taxes
Photo: Amazon sales tax map last updated Sept. 8, 2011, The Street
Earlier this year, ICIC supported AMEX’s Small Business Saturday event in solidarity with small, local businesses across the country. One of the oft-mentioned facts from that event was that purchases at big-box retailers return drastically less money to local communities than purchases at small businesses. The elephant in the room, however, is that online purchases currently return no money to local communities because of Quill Corp vs. North Dakota, an obscure 1992 Supreme Court decision. In the ruling, the courts essentially determined that out-of-state companies had to have a strong physical presence in a state to necessitate collecting sales taxes. 1992 was 2 years before the founding of Netscape, the first Internet browser – purchases made over the internet were thereby protected from state sales taxes. Should local small businesses be at a competitive disadvantage because the law hasn’t evolved with the times? Further, should states be deprived of sales taxes in a time of ballooning deficits?
Amazon’s Case – Burdens and Bottom Lines
Enter Amazon. Founded by Jeff Bezos in 1994, the company is a bellwether for the fates of online retail in this fight. Comprising 1/3 of all purchases on the Internet in 2011, they are to ecommerce what Walmart is to brick and mortars – the undisputed king of their commercial jungle with an inexhaustible appetite for continuing success. As the picture above shows, Amazon has faced resistance as states have cottoned on to the law’s distorting features and dealt with it in a patchwork manner. It should be noted that the 5 states where it pays sales taxes (Kansas, North Dakota, New York, Kentucky, and Washington) are the only markets in which the company has stores or offices.
BY Sathya Vijayakumar on April 17th, 2012
TAGS: small business | entrepreneur | business | retail | innovation | policy
Entrepreneurs and Bureaucrats, Dogs and Cats
Want to hear from an Inner City 100 winner whose company has grown exponentially in spite of the difficult economy? This CEO appeared on the Inner City 100 list for the first time last year and has continued to scale his operation and guide his organization to maturity. Orbit Media Studios is a digital marketing agency in Chicago. The company is led by Principal and Strategic Director Andy Crestodina. Andy started the company with a high school friend, a combination of their 401Ks and some credit cards. Orbit is located in a very diverse neighborhood with populations hailing from Romania, Germany and Latin America. Crestodina and the rest of the “Orbiteers” are also involved in doing online overhauls pro-bono for local non-profit organizations.
Guest Blogger: Andy Crestodina, Orbit Media Studios
Businesses are started with an exhilarating rush. Everything is new. Don’t know how to do something? Improvise! It’s a great feeling.
As things get off the ground, you start making those first big improvements, setting the foundation, and establishing the main processes. You feel like you’re building, and it feels good.
Gradually, the main pieces are in place, but there are still wrinkles to iron out. You start to “optimize” those processes. You feel like you’re getting smarter, and it feels good.
Eventually, you become the best-in-class in your category. Your business is now the best at what it does, but you do it by using tools and rules, best-practices and quality controls. Because of this, you might feel stuck and that isn’t good.
It’s the natural evolution of business. It’s called “maturing,” and its a good thing. However, it’s also the transition from entrepreneurial to bureaucratic. And if you’re the type of entrepreneur who thrives on chaos and the thrill of starting new things, you might get bored.
So how do you keep that initial exhilaration alive even after your enterprise is so optimized it feels bureaucratic? Be creative.
Here’s an example someone shared with me the other day:
BY Guest Blogger on April 13th, 2012
TAGS: small business | business | entrepreneur | creativity | bureaucratic
Creative Placemaking in Massachusetts’ Gateway Cities
(avg: 5.00 of 5)
A few months back, we posted a blog entry discussing how cities nationwide are turning to “placemaking” as a way to revitalize their economies. We profiled placemaking efforts—strategically creating places that people gravitate to because they are appealing and enjoyable—in Grand Rapids, which include Zombie Walks, Chalk Floods and an Annual Downtown Santa Invasion. While these efforts have certainly grabbed folks’ attention, more traditional placemaking is happening right here in our own backyard.
Today, research and policy organization MassInc hosted “The Gateway Cities Creative Placemaking Summit” to highlight the growth of cultural and art projects in Massachusetts’ older industrial cities. These “Gateway Cities” tend to be low-income, distressed, and very culturally diverse. Politicians and community leaders from the various Gateway Cities convened to discuss what placemaking efforts are working best to revitalize their downtowns, and where cities continue to struggle.
An early observation worth noting: Anita Walker, the Executive Director of the Massachusetts Cultural Council, pointed out that there are two sets of lenses with which to look at placemaking:
- Those with deep, personal knowledge of the community; or
- Those who have never been to your community before, but who you would like to attract to your city.
She references a town called Battle Mountain: upon entering the town, there’s a massive Shell Company sign that, for a long time, had the “S” burned out—not a good first impression for visitors. Creative placemaking begins with a remedy for these simple problems to make your community more attractive.
So what placemaking efforts are happening in Massachusetts’ cities?
BY Amanda Maher on April 11th, 2012
TAGS: cities | economic development | placemaking | gateway cities | pittsfield | lynn | lowell | cultural institution | art | industrial | massinc | community development | downtown
Crossing the Digital Divide: Deploying Technology to Leverage Growth
Guest Blogger: Beth Goldstein, Boston University School of Management
A recent study by the Pew Research Center showed that almost 9 out of 10 American adults own a cell phone and 46% own a smartphone. That’s an impressive climb from 35% just under a year ago. Even more interesting is a recent AT&T Business Technology Poll that showed 70% of small businesses use mobile apps for business operations. So, how are these small business owners using applications to grow their companies? According to the study, almost half (49%) used it for navigation and mapping (GPS), 26% for social media marketing, 26% for document management, 23% time tracking/management, 22% for travel and expense tracking and 20% for credit card payments in the field. These tools have moved from playing Angry Birds or Words with Friends to being critical applications that empower growth and help companies succeed and outpace their competitors.
BY Guest Blogger on April 10th, 2012
TAGS: small business | business | entrepreneur | ic100 | technology | inequality | digital divide | social media | smart phones
Gearing up for the Inner City 100: A Preview of Winners
(avg: 2.50 of 5)
Photo: Specialized Therapy Services of Amarillo
When entrepreneurs decide where to locate their companies, many overlook inner cities. This is somewhat surprising, given the assets located in inner cities: access to infrastructure, untapped markets, a diverse workforce and business-to-business clusters are only a few of the reasons Inner City 100 winners have found success. There's also the myriad governmental programs offering incentives to locate within the inner city.
These facts were not lost on CSI, an 8(a) certified, American Indian owned, HUBZone certified Small Disadvanted Business. CSI topped the Inner CIty 100 - a compilation of the 100 fastest-growing inner city businesses - last year for it's year-over-year booming sales. It's no wonder the company finds itself on the 2012 Inner City 100 list this year, too.
Located within the Brick District of inner city Oklahoma City, CSI is an IT and engineering contractor for the U.S. Department of Defense. CSI employs an estimated 60 to 80 inner city Native Americans and boasts a 98% retention rate. Over the last five years, CSI has created 210 jobs, which ranks fifth among 2012 Inner City 100 winners in this category. The company was also ranked as the top firm on the 2011 Inner City 100. To foster entrepreneurship, CEO Ken Novotny mentors a lot of small, up-and-coming firms and offers one key piece of advice to business owners: Always be a strong leader and have confidence in yourself and your team.
BY Mary Duggan on April 6th, 2012
TAGS: small business | cities | ic100 | business | entrepreneurs | csi | sunset healthcare | specialized therapy services | gourmet guru | oklahoma city | amarillo | bronx | chicago
Identifying Ways Cities Can Help Small Businesses Thrive
(avg: 4.50 of 5)
Small businesses and entrepreneurs are fueling America’s economic recovery. Already, 95% of new jobs are created by small businesses. Yet businesses cannot go at it alone; mayors and economic development practitioners must support startups, entrepreneurs and existing small businesses in order to help them succeed.
Sounds great. We’re all on board. But how do local governments do that?
The National League of Cities (NLC) has spent the last several years researching how local governments can strengthen their small business climate. Today, NLC introduced “Supporting Entrepreneurs and Small Business: A Tool Kit for Local Leaders.” It includes an analysis of the various roles that support small businesses within city hall, partners for growth, and introductory case studies to analyze how cities are already supporting small businesses to create local jobs. Below is NCL’s blog entry about the launch of the Tool Kit.
By J. Katie McConnell, originally posted on CitiesSpeak.org
There’s been no shortage of interest and commentary about the importance of entrepreneurs and small business to the nation’s recovery. Almost daily, economists and policy wonks engage in a seemingly never-ending discussion on what the “right” businesses are to create jobs. And while these conversations have utility and value, they have not produced many actionable strategies for cities where entrepreneurs and small businesses actually exist. In response, NLC released Supporting Entrepreneurs and Small Businesses: A Tool Kit for Local Leaders.
Almost universally, city leaders understand the value of all shapes and sizes of entrepreneurs and small businesses. These businesses create jobs, employ local residents, and help define a community’s sense of place. What is often unclear, however, is how city leaders can foster an environment that encourages entrepreneurs and small businesses.
BY Amanda Maher on April 4th, 2012
TAGS: small business | economic development | community development | boston | innovation district | jobs | placemaking | seattle | national league of cities | tool kit | entrepreneur | start-up
The Cleveland Model: Leveraging Anchor Purchasing for Community Benefit
(avg: 4.50 of 5)
By: Steve Dubb, Research Director, The Democracy Collaborative
Anchor institutions, often known as “eds and meds,” can leverage their power as local investors, developers, and consumers of goods and services in order to create jobs in nearby disadvantaged communities. This strategy has the potential to start a virtuous economic cycle that can foster new job growth locally and regionally.
The Evergreen Cooperatives in Cleveland, where our organization, The Democracy Collaborative, has been a partner since 2007, provides an example of this approach.
The Evergreen Cooperative Initiative is centered in Cleveland’s University Circle area, home to many of the city’s leading anchor institutions that are a legacy of the city’s industrial past. Local anchors include the Cleveland Clinic, Case Western Reserve University, and University Hospitals. Together, these institutions employ more than 50,000 people and are among the leading economic engines of Northeast Ohio.
Yet the surrounding neighborhoods (Glenville, Hough, Fairfax, Buckeye/Shaker, Little Italy, and the eastern portion of East Cleveland) are among the most disadvantaged (43,000 residents with a median household income below $18,500).
In 2005, the Cleveland Foundation brought together major anchors, community groups, and others to form the Greater University Circle Initiative. The goal is to stabilize and revitalize these “Greater University Circle” neighborhoods. As part of this initiative, in 2007 the Initiative launched Evergreen.
BY Guest Blogger on April 3rd, 2012
TAGS: small business | economic development | jobs | anchors | shared value | cleveland | ask the expert | evergreen cooperative | university circle
Being Business-Friendly Doesn’t Always Mean Job Growth
With the presidential election around the corner, the issue of the day remains the state of the economy. Americans continually voice their concern over looming unemployment, stagnant wages and the rising cost of inflation. The federal government, many argue, should be doing more to strengthen the economy.
But there is only so much the feds can do: the American Recovery and Reinvestment Act was passed in 2009 to boost job growth, but its cost infuriated those concerned about adding to an already large national debt. The feds can keep interest rates low, but unless Americans are willing to take risks, borrow money, or invest, the lower interest rates won’t make much of a difference. The feds could outright hire more governmental employees—but budget cuts have caused a significant decrease in public servants; not vice versa.
Absent of federal leadership, to whom should we turn for job growth? The private sector.
It’s no secret that robust consumer and business demand hold the key to further economic recovery. In February 2012, total U.S. payroll rose by 227,000: private sector employment grew by 233,000, signifying a net loss of 6,000 public sector jobs.
At first glance, this tells us that cities should be implementing policies and taking action to make themselves more business-friendly. The more conducive the climate is for the private sector, the more likely a business will be able to expand and create new jobs.
Which regions are doing best at creating a business friendly climate?
BY Amanda Maher on March 29th, 2012
TAGS:
How to Keep Your Employees Happy, Engaged and Contributing to Your Bottom Line
Why This Book from Teresa Amabile on Vimeo.
During a time when many companies are trying to accomplish more work with less staffing power and limited resources, employee engagement has never been more critical. Unfortunately, job satisfaction is at a low in the U.S. Disengaged employees are not producing their best work, resulting in slower revenue growth for businesses.
Harvard Business School Professor Teresa Amabile, and independent researcher Dr. Steve Kramer have dedicated years of research to bear insight into the emotional aspects of work. The pair was able to tap into the minds and hearts of American workers by collecting and analyzing 12,000 diary entries from 7 different companies. Recently, Amabile and Kramer published their findings in a book titled, The Progress Principle: Using Small Wins to Ignite Joy, Engagement, and Creativity at Work.
What did they find?
It matters how people feel at work. Employee engagement drives the bottom line and managers have the power to re-energize their workforce.
Here are a few key themes from Amabile and Kramer’s research:
BY Sathya Vijayakumar on March 28th, 2012
TAGS: small business | business | workforce | ic100 | ask the expert | progress principle | workplace
Taking Roommate Applications: The Rising Cost of US Apartments
(avg: 4.33 of 5)
Each week we are seeing new signs of economic recovery here in the United States. Investor confidence is up as Greece’s debt restructuring came through. Financial markets continue to climb. Reduced unemployment is fueling higher incomes and greater spending.
Lost in this positive economic news is the struggle plaguing our poorest residents.
A new report by the National Low Income Housing Coalition (NLIHC) highlights the impact that the recession has had on low-income families. The recession may have reduced the cost of homeownership, but the number of foreclosures had the unintended impact of forcing up prices within the rental market. Why does this matter? Low-income families are those most likely to be in the rental market.
Specifically, the authors analyzed the gap between the estimated hourly wage (the “Housing Wage”) necessary to afford a two-bedroom apartment and the wage the average renter in America actually earns (“Renters’ Wage”). The Housing Wage is determined based upon the full-time hourly wage a household must earn in order to afford a decent apartment at the HUD estimated Fair Market Rent while spending no more than 30% of income on housing.
The report finds that in 2012:
- The average Housing Wage: $18.25 per hour
- The average Renters’ Wage: $14.15 per hour
- Gap between Housing and Renters’ Wage $4.10 per hour
What this means is that in no state is an average 40-hour workweek enough to accommodate the rising cost of renting an apartment.
BY Amanda Maher on March 26th, 2012
TAGS: housing | poverty | rent | cities | affordability | wages | workforce | economic recovery | affordable housing
Growing a Family-Owned Business
Photo of Red Iguana CEO Luzmaria Cardenas
Family-run businesses experience both advantages and challenges that are unique from their competitors. However, this week our CEO Series revealed that over 85% of the issues faced by family-owned businesses are shared. Florence Tsai, Senior Advisor, Cambridge Advisors to Family Enterprise presented “Growing a Family-Owned Business” and noted that these issues are shared regardless of industry, size or culture.
This staggering stat offers good news for family-business owners in that many of the challenges they face have already been experienced and worked out by many other families. Identifying and preparing for these top family-business challenges is critical for achieving long-term growth. Below are the top three issues that Dr. John Davis, co-founder of Cambridge Advisors and Professor at Harvard Business School, found from his 20 years of research:
- Financial tension: One of the biggest sources of tension occurs when family members disagree on what should be done with dividends whether it’s taking money out of the business or putting money back into the business. This tension is especially prominent for older owners who want to build the company for future generations but also want to protect their retirement nest egg. Families in business together on average have little diversification in financial assets, with the business accounting for 80%of their assets. This means that owners are financially dependent on the dividends stemming from the operation. Hiring an outside financial consultant has proven helpful in reducing the financial tension.
BY Mary Duggan on March 23rd, 2012
TAGS: small business | business | entrepreneur | ceo series | family business | family
More than Understanding Your Market: Being a Part of It
(avg: 4.00 of 5)
Any entrepreneur will tell you: you must understand the market you’re serving. So who better to create a multicultural advertising firm than a Hispanic entrepreneur?
Jose Villa, a Cuban-American, jumped into cross-cultural marketing back in 1998 when he founded Focus Multimedia. Now known as Sensis Agency, the full-service advertising agency specializes in digital and online marketing for multicultural audiences.
How did Villa notice the market demand for such a business? Well, simply, Sensis was not his first venture. After college, Villa was developing website largely for small businesses in the Los Angeles area. He had such strong business from the Cuban-American community that he realized there was a real niche for multicultural marketing. For instance, Hispanics spend more time on the web than they do reading magazines or newspapers. Moreover, Latinos currently visit 13% more web pages and spend 10% more time online per day than their general market counterparts. There was huge opportunity given that studies show U.S. advertising companies find minority markets complex and difficult to reach.
No stranger to the Inner City 100 list, this two-time winner faced struggles when initially starting the company. First, Villa founded Sensis during the heart of the Dot-Com bust of the late 1990s. Despite the online business climate, Sensis found early success. But this lead the startup company to another challenge: meeting the demand of multiple clients with large-scale projects. Sensis was still in its infancy when large contracts began coming in, making it hard for the company to build out and meet demand. As Villa will be the first to admit, he started the company when he was young and inexperienced—but finding ways to overcome these challenges helped him grow Sensis in to the company it is today.
BY Alex Rodriguez on March 22nd, 2012
TAGS: small business | ic100 | los angeles | jobs | workforce | employee retention | employer | diversity
March Madness: Teaming up With Your University
(avg: 5.00 of 5)
Universities give you more than someone to cheer for. They can have a major impact on your bottom line.
It’s that rare time of year when we indulge in an long lunch or keep an extra browser open so we can watch the game. March Madness draws all eyes to colleges and universities across the country. But your local universities offer much more than a team to cheer for. They can have a major impact on your bottom line. Here are three ways to team up with local colleges and universities to help grow your business:
Scout out universities’ procurement policies to score an easy contract layup
U.S. colleges and universities collectively spend $200 billion annually on goods and services; better, they’re beginning to prioritize contracting with local and diverse small businesses. The University of Pennsylvania is perhaps the UK Wildcats of local procurement: Through its Buy West Philadelphia program, UPenn has increased spending with local suppliers from $2.1 million to over $90 million over the past two decades. Likewise, the University of Virginia has committed to increasing spending with small, woman-owned and minority-owned businesses by 5% each year.
Aztec Promotional Group, a promotional licensing company located near University of Texas-- Austin is one company that has reaped the benefits of university procurement. The company creates promotional materials for student organizations affiliated with the University. As Texas enters the NCAA tournament, Aztec is prepared to jump on related business opportunities. Your company should be prepared to service universities, too.
BY Steven Pedigo on March 20th, 2012
TAGS: small business | business | jobs | entrepreneur | workforce | anchors | universities | march madness
Ask the Expert: Answering the Lingering EBDI, Anchor Webinar Questions
(avg: 4.67 of 5)
Anchor institutions occupy a unique and influential place in America’s inner cities. In 66 of the 100 largest inner cities, an anchor is the largest employer. Some 925 colleges and universities, or roughly one in eight, are based in the inner city. About 350 hospitals, or roughly one in 15 of the nation’s largest hospitals, call an inner city home.
So what can your city do to extract the most benefit out of your universities and hospitals? What sorts of partnerships can be developed to create shared value for your inner city?
Earlier this month, Andy Frank, Special Advisor to the President on Economic Development at Johns Hopkins University and former Deputy Mayor of Baltimore, joined ICIC to answer these questions. Specifically, he discussed the well-known, and sometimes controversial, East Baltimore Development, Inc. (EBDI) project. He outlined the background of the EBDI project, financing of the project, the relationship between Johns Hopkins and the City of Baltimore, and the results that have stemmed from the redevelopment of the 88-acre Middle East neighborhood. To download the entire presentation, click here.
While webinar participants were able to ask questions throughout the presentation, a few important questions went unanswered. Below are the questions, followed by Andy Frank’s responses:
1) How much private real estate and business investment has been attracted to date - both equity and totals?
To date, there are eight completed projects, representing a total private investment of approximately $214 million. Three apartment projects were funded with low income housing tax credits. Forest City, the developer, reports having about $18 million of true equity in the project. The largest project is the $100 million Rangos building, a 278,000 square foot biotech building.
BY Guest Blogger on March 19th, 2012
TAGS: ebdi | ask the expert | johns hopkins | cities | economic development | community development | anchors | shared value | what works | baltimore | urban revitalization
The Hodgepodge of Partners in Frogtown Square
(avg: 4.00 of 5)
Public-private partnerships: Repeatedly we have heard they are the key to urban economic development projects. From Tallahassee, to Chicago to back here in Quincy, MA – municipalities are teaming up with private developers to finance the redevelopment of neighborhoods.
But what happens when a community decides there’s no role for private investment?
In St. Paul, Minnesota, activists pushed forward despite skepticism and, perhaps to the surprise of many, spent the past decade redeveloping the blighted University/Dale intersection of Frogtown Square.
Long known for its strip clubs, rampant prostitution and adult theaters, Frogtown Square had fallen in to a state of disarray. This mini-vice city served as a magnet for crime, drugs and gang activity. It was not long before the turf wars spilled in to the neighborhoods surrounding Frogtown Square. The disinvestment in the neighborhood was clear: boarded windows and shattered glass were everywhere. Homes in the area had plummeted to as low as $8,000 each by the mid-1990s.
Failing any major plans by the city or private sector to combat the dissolution of the neighborhood, community activists stepped in.
BY Amanda Maher on March 16th, 2012
TAGS: cities | economic development | community development | housing | retail | urban revitalization | st. paul | frogtown square | ndc | episcopal homes | model cities | tod | mixed-use development | transit
ExporTech: Helping Small Businesses Access Emerging Markets
(avg: 3.33 of 5)
We’ve said it before: Contrary to popular belief, manufacturing isn’t dead in America’s cities. In fact, a new study by the Brookings Institute shows that American exports area at their highest level in over a decade. From 2009 to 2010, American exports grew by a whopping 10%--the highest growth seen since back in 1997.
While these numbers are impressive, they could be even better, if small businesses only had a better understanding of how to access foreign markets.
In December 2011, Commerce Secretary John Bryson echoed this fact: “Many companies would like to export – they have great products to sell – but they aren’t sure how to get started. Small businesses in particular often face big challenges getting export financing, building relationships with foreign suppliers, or dealing with unfamiliar foreign rules and regulations.”
Small businesses already face challenges in capacity; the bandwidth needed to understand the complicated emerging market scene often prevents American companies from accessing the 95% of the world’s consumers who outside of the U.S.
To help small manufacturing businesses weave their way through the complicated international trade web, the U.S. Department of Commerce’s International Trade Administration has created the ExporTech program. The program assists participating companies in “developing an international growth plan, provides experts who will vet their plans and connects the companies with organizations…that will help them move quickly beyond planning to actual export sales.”
BY Amanda Maher on March 14th, 2012
TAGS: small business | jobs | business | entrepreneur | manufacturing | exports | exportech | emerging markets | commerce
Entrepreneurship: Solving "People Problems"
(avg: 5.00 of 5)
News flash: new ventures are risky propositions. For such a universally accepted truth, however, a consensus on why startups fail has eluded the practitioners, researchers, and policymakers that have generally supplied conventional wisdom over the last few decades. New work by Harvard Business School professor Noam Wasserman has uncovered that around 60% of failures occur due to “People Problems,” or issues dealing with the management and growth of personnel. Part of what’s mystifying about managing a new company is that even answers to problems seem to create an ever-expanding frontier of new questions that need to be answered for the organization to move forward. Below are some of the most salient People Problems that you should be aware of before you start your next venture.
Cofounder Dilemmas
Perhaps the first question an aspiring CEO must gauge is whether to get a cofounder and, if so, who it should be. Paul Graham, founder of what became Yahoo Store and the paradigm-shifting seed accelerator YCombinator, lists having only a single founder as one of the 18 mistakes that kill startups. Graham writes, ‘The low points in a startup are so low that few could bear them alone. When you have multiple founders, esprit de corps binds them together in a way that seems to violate conservation laws. Each thinks "I can't let my friends down.’ This is one of the most powerful forces in human nature, and it's missing when there's just one founder.”
BY Sathya Vijayakumar on March 12th, 2012
TAGS: entrepreneur | small business | start-up | ic100 | workforce | business
Coming Down Just a Little Bit: #GIDII
(avg: 4.50 of 5)
On March 5-6th, ICIC was in Chicago for the “Getting it Done II” (followed on Twitter using the hashtag #GIDII) conference hosted by the Institute for Comprehensive Community Development, a LISC organization. The two-day event was to look at the strategies being used to “Build Strong Communities in a Changing World.” From education, to safety to adapting to a globalized world, over 800 economic development practitioners convened to discuss the strategies they’ve been employing to improve their home cities.
We learned how San Diego is using “Tastes of” neighborhoods to bring together diverse populations and celebrate cultures. We heard how despite significant housing improvements in West Baltimore, attracting retail remains a challenge. And we listened as Matthew Thrall detailed the plans for the new Fairmont / Indigo transit line in Boston that will hopefully revitalize the city’s low-income communities.
Each of the eight workshops and thirteen roundtables offered unique case studies like that above. However, there were more general themes that ran throughout the entire conference.
1) There needs to be a comprehensive approach to community development, with state and federal governments supporting the efforts. During Day 1’s luncheon keynote, Erika Poethig of the U.S. Department of Housing and Urban Development outlined the several programs being implemented at the federal level to support such efforts. Specifically, she pointed out that this year is the 10th anniversary of the New Communities Program; and that Obama’s “Strong Cities, Strong Communities” initiative continues these efforts by bringing together representatives from throughout the executive branch (such as the EPA and the Department of Justice) to streamline community development in six of the nation’s hardest hit cities. She explained that despite these efforts, however, congressional committees need to lend their support; not all work can be done within the executive branch.
BY Amanda Maher on March 9th, 2012
TAGS: economic development | community development | lisc | institute ccd | chicago | conference | safety | cities | regional economies
Drum Roll Please...OK We Can't Take It Any Longer
At ICIC we are counting down until the Inner City 100 Symposium on May 9th. In just 9 weeks we will showcase the 100 fastest-growing inner city businesses in the U.S. The 2012 Inner City 100 rankings will be revealed for the first time and CEOs will share their inspiring stories of how they have grown their businesses and created jobs in their communities.
The theme for this year’s Symposium is “Innergize your city,” which is exactly what these business leaders have accomplished across the U.S. Creating job opportunities, hiring locally, investing in workforce training and partnering with local suppliers are just a few ways in which these companies are bringing a contagious force into their communities.
Let’s face it: we are a little too eager to share these urban success stories. Below is a sneak-peak of three companies to be highlighted on this year’s list.
Detroit-based Edibles Rex was founded two decades ago when Tammy Tedesco purchased a 700 square foot yogurt shop and turned it into a deli. Using personal capital, she grew the deli into a catering business serving major corporations, social events and charter schools in and around Detroit. Schools now make up the majority of the company’s revenue as Edibles Rex provides nutritionally sound, high-quality meals to children on free and subsidized meal plans. With innovative offerings such as black been brownies and blood oranges, Tedesco continues to envision new ways to help kids eat healthy.
BY Mary Duggan on March 7th, 2012
TAGS: small business | business | entrepreneur | jobs | workforce | ic100 | detroit
Biotech Grows in Brooklyn
SUNY Downstate Medical Center in Brooklyn, New York is a medical anchor institution that has led the growth of the biotech cluster in Brooklyn through its Biotech Initiative. Downstate leverages private and public dollars to build biotech incubator facilities in distressed areas of Brooklyn, providing much-needed lab space for growing biotech companies, offering entrepreneurial opportunities for students and faculty, and transforming neighborhoods for the better. The school also builds a critical pipeline of local talent through a workforce development program that offers training to local students with a basic science education by providing paid internships and job placement opportunities at the incubators.
The visionary director of the Biotech Initiative, Dr. Eva Cramer, tells us more about Downstate's exciting Cluster Anchor activities. Dr. Cramer, a "one-woman biotech powerhouse" as described by One Thing New, has done amazing things for the biotech cluster in Brooklyn. Click here to learn more about Dr. Cramer's story.
Guest Blogger: Dr. Eva Cramer, SUNY Downstate Medical Center
While New York City has top academic medical research institutions and is rich in scientific and biomedical talent it has lagged behind other areas of the country in retaining and attracting small and midsized biotechnology companies. A primary reason has been the lack of affordable wet lab space.
In October 2000, Downstate developed Downstate Technology Center Inc. (DTCI), a not-for-profit corporation, to establish and operate a biotechnology park adjacent to its campus. The Biotech Park would not only provide much needed commercial biotechnology space but would enable a symbiotic relationship to develop between the companies and Downstate’s faculty and students.
The cornerstone of the park was a Biotechnology Incubator for early-stage companies. DTCI financed the design and construction of the Incubator with city, state, and federal grants. The first of these, $500,000 from the New York City Council and an equivalent grant from the New York State Foundation for Science, Technology and Research (NYSTAR), funded the architectural design. Construction, it was decided, would proceed in phases as the building filled and grant funding became available.
BY Guest Blogger on March 6th, 2012
TAGS: cities | economic development | anchors | business | community development | shared value | brooklyn | biotech | workforce | jobs | workforce training
Workforce1: Putting NYC Back to Work
(avg: 3.75 of 5)
Despite the recent uptick in the economy, many Americans are still searching for work. Employment opportunities are particularly crucial for inner cities, as the poverty rate is a whopping 19% in cities compared to just 9% in the rest of the United States.
So how do we get these residents back to work and on a path to prosperity?
While there is no one single answer, New York City has found success with its Workforce1 Career Centers.
The Centers, located throughout the five boroughs, prepare and connect residents to entry- and mid-level jobs with local employers. Any resident aged 18 and above is eligible for these free services, from those without a GED to those with advanced degrees. The Workforce1 Centers screen candidates for job opportunities, host recruiting events, offer skill-building workshops and house a resource library for job advice and networking tips. The goal: getting New York City residents back to work.
A workforce development center—don’t all cities have these?
BY Amanda Maher on March 1st, 2012
TAGS: jobs | workforce development | nyc | cities
Seven Questions to Ask a Potential Investor
Last month the 2012 CEO Series premiered with Peggy Wallace, Managing Director of Golden Seeds presenting What are Angels Looking For? Peggy walked entrepreneurs through the angel investment process and offered tips for preparing a pitch and closing a deal.
Last week the CEO Series continued by offering a guide through another source of funding – venture capital. Cody Nystrom, Principal at SJF Ventures, along with Ed Powers, Managing Director of BAML Capital Access Funds, presented Negotiating with a Potential Investor.
As background, SJF Ventures provides equity financing through its investment funds, between $1M and $10M, to companies seeking expansion capital. The firm focuses on the clean tech, web-enhanced services and consumer products sectors. In particular, SJF looks to partner with entrepreneurs in the field of social enterprise—using their businesses to positively impact the world. BAML Capital Access Funds is a private equity funds-of-funds manager and advisor focused on meeting the targeted mandates of institutional investors.
During the webinar Ed Powers and Cody Nystrom shared their unique perspectives with the participating CEOs to help prepare them for the venture capital investment process. Both presenters emphasized the importance of choosing the right financial partner. A good test for determining the right financier is asking yourself if you would feel comfortable sitting next to him or her during a four-hour flight. If the answer is “no,” then you probably shouldn’t be entering into a long-term financial partnership with this person. In addition to asking yourself this question, CEOs should feel comfortable turning the tables on potential investors during the negotiation and posing their own due diligence questions.
Below are seven key questions that small-business owners should not shy away from asking potential investors.
What are your expectations for the term sheet? Investors don’t offer a term sheet to a CEO until they have done their due diligence by researching the company, checking references and reviewing financials. This due diligence process could take up to several months. A CEO does not want to go through this time-intensive process and then find that they do not agree with the investor on a presented term sheet. In the early stages of due diligence, a small-business owner should bring up expectations for the term sheet so both parties are on the same page as they move forward in the process.
BY Mary Duggan on March 1st, 2012
TAGS: small business | business | entrepreneur | capital | ceo series | executive education | negotiation | venture capital
Special Delivery from an Inner City Pizzeria to Air Force One
Michael Cisneros (clockwise from left), Dan Piecora Jr., Brian Gojdics, Joe Fugere and Emily Resling stand on the steps of Air Force One. By Tom Schabarum
Inner City 100 firms literally serve every type of customer imaginable – businesses of all sizes, local residents, every level of government, non-profits, universities and hospitals and even the President of the United States. That’s right, the Seattle-based team at Tutta Bella Neapolitan Pizzeria and CEO Joe Fugere recently had the opportunity to serve their authentic, Neapolitan-style pizza to the Customer-in-Chief and his flight crew as they traveled out of the Seattle-area on Air Force One. What an incredibly well-deserved opportunity for a highly successful firm that is creating jobs and wealth within an inner city community.
BY Alex Rodriguez on February 29th, 2012
TAGS: small business | business | entrepreneur | ic100 | food
How Google+ Can Add To Your Business
(avg: 4.00 of 5)
Guest Blogger: Brad Farris, Principal Advisor, Anchor Advisors
Brad Farris has spent the last 10 years as a Small Business Advisor at Anchor Advisors in Chicago. He also shares Small Business Tools and Templates at EnMast.com, a small business owner’s community.
Just when you’ve mastered Tweeting and posting, Google has thrown another social networking site into the mix – Google+.
When I first learned about Google+, I signed up for it, but didn’t give it too much attention initially. At first I thought, “It’s a slightly better version of Facebook, but there’s no one there.” But as I thought more deeply about what Google’s all about, and how Google+ fits into their product line as a whole, I realized that if you’re doing any social media for your business, it should be Google+.
Google+ works in a way that the other social media don’t. You see, Twitter and Facebook discourage (or prohibit) Google from including their content in Google search results. But Google understands the power of a personal recommendation, so they have started including the things that you recommend on Google+ so that your friends can see your recommendations when they conduct a Google search. It’s called “Search plus your world” and it’s a huge change in how Google will be driving traffic to your site. Whenever you are logged into any Google product and you search for something in Google, it will change the results to reflect the things that your friends have +1’ed (Google’s version of “liking” something).
BY Guest Blogger on February 27th, 2012
TAGS: small business | business | entrepreneur | marketing | social media | google plus | seo | content marketing
Thinking big, thinking bold - Introducing What Works: Solutions for Cities
(avg: 5.00 of 5)
What do baby boomers, families, young professionals and new U.S. immigrants all have in common? They’re driving the reurbanization of America. After decades of flight, cities are becoming the go-to choice of living. Access to amenities—including parks, transportation, restaurants, cultural facilities and sporting events—are making cities the preferred alternative to suburban living.
But as the demographic shift continues, cities must find ways to accommodate growth. Economic development initiatives are at the forefront of cities’ agendas: how can we promote equitable urban revitalization and foster job growth and economic opportunity for all residents—new and old alike?
There is no one answer. Indeed, solutions will flow from the public, private and nonprofit sectors—and will often need the collaboration of all three. In some cases, cities will lead the way. In others, the private sector or anchor institutions such as hospitals and universities might be the vanguard of action. What’s clear is that we need to identify what’s working in cities across the nation in order to learn from others and implement variations in our own cities.
This is why today, after many discussions with our national partners and with attendees of the Inner City Economic Summit, ICIC is launching its What Works: Solutions for Cities campaign.
At the heart of What Works is the compilation of best practices being employed to address some of the nation’s greatest economic and businesses development challenges in cities....
BY Amanda Maher on February 23rd, 2012
TAGS: economic development | jobs | cities | small business | community development | business
Finding Demand, Rapid Growth and then: Selling
(be the first to rate this article)
There’s no denying it: rapid business growth is great for companies that can accommodate increased sales. It leads to new job creation and an influx of dollars in to the local economy.
At the same time, it raises eyebrows of competitors who may seek to acquire the fast growing business before it hinders the growth of their own company.
This is exactly what happened to 2011 Inner City 100 winner Salar, Inc.
Salar, based out of Baltimore, provides electronic filing services for the health care industry. They integrate information and documentation systems for doctors and hospitals, enabling health care providers to move from paper-driven processes to electronic data tracking and storage.
CEO Todd Johnson and his co-founder, Meir Gottlieb started Salar right after graduating from Cornell. The two opted to start their own company rather than trying to work for someone else. They graduated at the height of the dot-com boom, making an internet start-up a wise decision. Initially, they offered a software development service that attracted a few health care service clients. As a result, they began to develop a keen understanding of the digital serviced in high demand by health care customers.
BY Alex Rodriguez on February 21st, 2012
TAGS: small business | business | entrepreneur | ic100 | acquisition | baltimore | health care
Food Trucks: Another weapon in the food cluster arsenal
(avg: 4.67 of 5)
Move over urban gardens. It’s food truck time.
The latest rage sweeping our cities is the food truck movement. In formerly barren neighborhoods, food trucks are popping up left and right. In downtowns and in neighborhood squares, these trucks serve quick, convenient food for passersby.
So what’s behind the movement?
In some cities, the cost of doing business has grown so high that it prevents new companies from entering the market. By some estimates, it costs an average of $275,000 to open a new restaurant; a food truck can cost as little as $10,000 to get up and running. Given the tight credit market over the past few years, it takes more up-front capital to start new businesses. This makes the food truck market easier to enter than the traditional restaurant business.
Once in operation, the food trucks are a way to introduce consumers to new foods. From vegetarian-only vendors to Thai-food vendors, the trucks draw people from the traditional fast food joints they might otherwise frequent during lunch. As food truck licenses increase, new options abound. Food trucks serve (pun intended) as vehicles for cultural dissemination.
BY Amanda Maher on February 20th, 2012
TAGS: food | cluster | economic development | jobs | small business | cities | retail
Key Terms to Help Get You Through Your Next Negotiation
To help you avoid having to breathe fire as in the cartoon above, I’ve compiled a list below of a few key terms that will give you a leg up when you engage your next negotiation. Whether you’re trying to buy a new car, find middle ground on wages with a labor union, or settle on a cost structure for procurement contracts, being a good negotiator is an invaluable skill to have in your professional repertoire. As President Obama recently found during the debt ceiling debate, negotiating skill can be the difference between success and default.
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Anchor: Anchors are reference points around which negotiations evolve. As this working paper by Professor Adam Galinsky of Northwestern University recommends, negotiators should anchor aggressively and make the first offer in most circumstances. Why do anchors work so well even among educated negotiators?
“The answer lies in the fact that every item under negotiation (whether it's a company or a car) has both positive and negative qualities—qualities that suggest a higher price and qualities that suggest a lower price. High anchorsselectively direct our attention toward an item's positive attributes; low anchors direct our attention to its flaws.”
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Frame: Make sure you “frame” the context of the debate in a positive perspective. The excerpt below from “Negotiation Strategy: 6 Common Pitfalls to Avoid” profiles research by prominent Stanford Business School professors and provides a telling comparison of how framing makes a difference in an argument.
“For example, you are a purchasing manager renegotiating an hourly wage contract with a subcontractor. The subcontractor currently makes $10 an hour. You are willing to elevate the subcontracting firm to $11 an hour. Another organization recently boosted its rate with your subcontractor to $12 an hour. You know that when the negotiators for your subcontractor hear your $11 offer, they may think they are going to have to give up a dollar an hour.
You must get them to focus on the point you are starting from — $10, not $12. You frame the issue positively by talking about all the ways your contract is different from the others. Your contract has some advantages outside of the hourly pay. The other side will be more willing to risk lower wages for the purported other benefits. A common mistake is negotiating from a negative frame: "The other firm's deal offers more, but we can afford only $11.”
BY Sathya Vijayakumar on February 17th, 2012
TAGS: small business | negotiation | executive education | business | entrepreneur | ic100
The Future of Community Banking, and What it Means for Small Businesses
(avg: 3.75 of 5)
Above: Chairman of the Federal Reserve Ben Bernanke Addresses FDIC Conference this morning
Year in and year out, we honor the 100 fastest growing inner city companies. Part of the year-long process in finding and awarding these firms includes both quantitative and qualitative surveys and interviews of the CEOs. Through this process, we learn about how inner city companies come to fruition, what some of their business challenges are, and how CEOs finance their companies.
This year, like each year in the past, we are coming across a trend: overwhelmingly, most inner city companies view access to capital as one of their most prohibitive obstacles to growth. Yet, these companies are still growing and finding success.
How?
One thing the CEOs have attributed their growth to is their strong relationships with their bankers. In one of my most recent interviews, the CEO explained that he and his banker go out to lunch once a month just to chat, to address the needs of the CEOs business. Another CEO said he is a customer at a large bank that doesn’t understand his needs, and therefore, is shopping around to smaller competitors.
BY Amanda Maher on February 16th, 2012
TAGS: small business | jobs | business | entrepreneur | capital | federal policy | banking | fdic
How Cities and Businesses Can Grow Together
(avg: 4.00 of 5)
Article by ICIC's Steven Pedigo, originally published on Inc.com
Location, location, location! We’ve all heard that, for many small businesses, one of the keys to success lies in landing the right real estate. But the reverse is also true: Small businesses are essential drivers of America’s cities, and your company and others like it have the capacity to make your city a prime location, location, location!
As businesses invest in their community, the community grows and becomes healthier. Businesses then reap the benefits of being part of a thriving community. This principle of shared value – creating economic value while also creating value for society – lies at the very heart of economic success.
Here are five ways your business can increase its competitiveness by helping to re-energize your city.
BY Steven Pedigo on February 14th, 2012
TAGS: cities | small business | entrepreneur | jobs | business | clusters | workforce | real estate
IC100 Companies: Innergizing Their Cities
(avg: 4.00 of 5)
We know that small businesses drive inner city economic growth. From mom and pop shops, to manufacturing firms, inner city companies employ local residents, invest in community programs, and add value to their neighborhoods. This is why ICIC has been honoring the fastest growing inner city firms for the past 13 years.
And we’re at it again!
After months of outreach and applicant review, we have identified the 100 fastest growing inner city companies. The 14th Annual Inner City 100 list will be published in Fortune magazine this spring. The list is comprised of 59 new firms in an array of industries: ranging from organic food manufacturing and distribution, online pet moving services to a NYC-based microbrewery. The diversity of companies is matched by diversity in location—this year’s list includes businesses from every corner of the United States. Through sound business practices, every member of the 2012 Inner City 100 grew at rates that defied national trends.
The award allows Inner City 100 winners to take part in a full day of management education at Harvard Business School, with presentations by Boston University and Babson College, among others. The final unveiling of the list will occur on May 9, 2012 at the Inner City 100 Symposium and Awards dinner. For the first year in the program’s history, you will be able to join this dynamic group at a discounted rate: To find out more about the event, access our agenda and register today.
In the meantime, we wanted to provide a glimpse of some of our Inner City 100 winners...
BY Alex Rodriguez on February 13th, 2012
TAGS: ic100 | jobs | cities | small business | business
Hiring a Non-Traditional Workforce
(avg: 4.75 of 5)
We’ve all heard the stories: one mistake can ruin your life if you wind up with a criminal record. From misdemeanors like possession of marijuana, to more serious crimes like assault and battery, those who err may not just end up in prison, but they will forever have to check off the “offender” box on job applications, all but guaranteeing their application is bypassed.
In Baltimore, the incarceration rate has become profound. When released, failure to become gainfully employed often leads these ex-offenders back to a life of crime.
Johns Hopkins Medical (JHM) took note of this phenomenon: each year, there are as many ex-offenders released from Maryland’s prisons as are the number of people employed at the entire Johns Hopkins medical complex in East Baltimore. If JHM could find a way to reintegrate these people back in to society though meaningful employment at the anchor institution, it would certainly help reduce the rates of recidivism.
BY Amanda Maher on February 10th, 2012
TAGS: johns hopkins | baltimore | workforce | shared value | anchors | community development
Addressing Small Business Needs in Targeted Cities
Over the past two days, Living Cities’ Integration Initiative has been in Washington, D.C. presenting the findings of its Small Business Framing paper. By way of background, The Integration Initiative (TII) is working in five distressed cities to help them “harness existing momentum and leadership for change, overhauling long obsolete systems and fundamentally reshaping their communities and policies to meet the needs of low income residents.”
To do so, they have a keen eye on small business development. In a recent blog entry, John Moon, Assistant Director of Capital Formation in Living Cities, identifies the key findings of the small business framing paper. Specifically, they find that small businesses are so diverse that a "one size fits all" approach to addressing their needs is not sufficient.
Small Business: One Size Does Not Fit All
By: John Moon
As the country and policy makers focus on job creation and economic revitalization, they eventually look to small businesses. There are strong reasons to do so. Almost 99% of all US firms are small businesses (defined by the Small Business Administration as firms with fewer than 500 employees); they contribute 50% of the US GDP and are the source of most new job creation. Besides creating jobs, small businesses also help build the local tax-base, create and contribute to a sense of place, and provide an important source of wealth creation. Hence, if you want to address unemployment and improve economic vitality, strategies that support small businesses must be considered.
BY Guest Blogger on February 8th, 2012
TAGS: cities | business | jobs | entrepreneur | detroit | baltimore | newark | twin cities | cleveland | living cities | the integration initiative | capital
How Columbia University Partners with NYC to Support Local and Diverse Small Business
(avg: 3.80 of 5)
Columbia University provides a leading example of how an anchor institution can make its purchasing dollars more accessible to local small businesses. Working with local construction enterprises strengthens the university's ties with the local West Harlem community. It also expands and diversifies the pool of qualified vendors, which provide speedy, nimble, and reliable service. La-Verna Fountain, Associate Vice President, Construction Business Services and Communications of Columbia University explains how the institution's local purchasing efforts took shape and articulates several key lessons for aspiring anchor institutions.
Public-Private Partnerships: Making Things Work
By: La-Verna Fountain
Sometime in early 2008, the Executive Vice President for Columbia University’s Facilities Department, Joe Ienuso and the Commissioner for New York City’s Small Business Services, Rob Walsh met to discuss the possibility of Columbia University and Small Business Services joining together to address a common challenge. Joe wanted to increase the amount of construction dollars spent with minority, women and locally-owned (MWL) businesses. Commissioner Walsh wanted to increase the amount of city contracts awarded to minority- and women-owned businesses operating in the City.
The challenge facing both the City and Columbia was the fact that they were large, bureaucratic institutions. In the nation’s largest city, too few minority and women owned businesses are equipped to handle the administrative and financial complexities of large institutions to compete with majority-owned construction trade firms.
BY Guest Blogger on February 7th, 2012
TAGS: anchors | shared value | nyc | public-private partnerships | columbia university | chre | workforce | industrial | ask the expert | mwbes
Economic & Social Inclusion: Day 3 at New Partners for Smart Growth
(avg: 5.00 of 5)
Seattle sees its music scene as part of its city’s economic development and appeal. Pictured here: Slimpickins, busking at Pike Place Market.
By: Alex Abboud
The third and final day of the conference featured two plenary sessions (the first and last ones during the day) and two breakouts. The themes of the sessions I attended focused on diversity, social, and economic inclusion.
The Great Reset: Reshaping Our Economic and Physical Landscape to Meet New Needs
This session, featuring senior civic leaders, discussed the changing landscape, and the urgency to develop communities that meet the demands of consumers.
Kim Walesh, Director of Economic Development for San Jose, spoke to the demographic changes, and how this affects the market. She noted that development has targeted the 35-54 age group, but demographics are shifting to seniors, as Baby Boomers enter that demographic in large numbers, and young professionals, as Millennials come of age. They both want a more urban environment. Baby boomers want to be able to walk to restaurants/shops and medical appointments. Millennials have what she described as a “live first/work second” outlook, meaning they’ll choose a community/city where they’ll want to live first, then look for work second. She also noted that this group is 33% more likely than other demographics to want to live within 3 miles of a Central Business District.
Speaking anecdotally as a Millennial (and child of baby boomers), Walesh’s argument resonates with everything I see and hear amongst both my and my parents’ respective cohorts.
On the inclusion theme, Walesh made a powerful argument for the value of immigration, pointing out that 50% of CEOs of Silicon Valley tech companies are foreign-born, and 40% of Fortune 500 companies were founded by immigrants or second-generation Americans.
BY Guest Blogger on February 6th, 2012
TAGS: economic development | community development | housing | retail | san jose | seattle | twin cities | cincinnati | cities | equity | new urbanism | npsg | conference
Sustainability, Walkability & New Urbanism: Recap of New Partners for Smart Growth Conference, Day 2
(avg: 4.00 of 5)
By: Alex Abboud
Following on my post from the first day of New Partners for Smart Growth, here is a quick recap of Friday’s sessions:
Building a Powerful Regional Equity Coalition to Deliver on Sustainable Communities
Building on what I noted in the East Baltimore project, three organizations spoke about how they’re ensuring smart growth and redevelopment is inclusive of all residents, particularly marginalized communities. Urban Habitat, out of San Francisco, has developed a Board and Commission Leadership Institute, where they prepare and encourage members of marginalized communities to participate in civic boards and commissions. They’ve gone, in the words of CEO Allen Fernandez-Smith, from “the goal of influencing decision-makers to the goal of being the decision-makers”. San Francisco is also leading the way with a Local Hire Policy for public works, including a provision for employing residents from disadvantaged communities.
Farmers’ Market
For lunch we went to the Farmers’ Market at Cancer Survivors’ Park, adjacent to the conference hotel. California is leading the way with more than 700 farmers’ markets across the state, and this ties in well with San Diego’s thriving local food culture I noted in the Thursday recap.
BY Guest Blogger on February 5th, 2012
TAGS: cities | economic development | food | transit | workforce | smart growth | new urbanism | npsg | conference
New Partners for Smart Growth - Takeaways from Day One
(avg: 4.50 of 5)
By: Alex Abboud
I’m at the New Partners for Smart Growth conference in San Diego, which started Thursday and ends today. When I have more time following the conference, I plan to write more in-depth on what I learned, but my writing on the conference will begin with a quick recap of each day. Here is a brief overview of what I attended on Thursday. You can read full descriptions of the sessions here:
Restoring Prosperity in America’s Legacy Cities
Feeding my current Rust Belt obsession, I attended this session to learn what former industrial centers are doing to ‘right-size’ and adapt.
In East Baltimore, the Annie E. Casey Foundation has been involved in facilitating redevelopment that is sensitive to the existing residents. With Johns Hopkins University expanding, the Foundation played a key role in ensuring residents were included, and benefited (such as having priority to send their kids to the new school, and economic inclusion agreements for redevelopment work). Where relocation happened, due to eliminating unsuitable housing, support was providing for tenants to relocate. One of the dangers of revitalization/gentrification, a theme that has come up a lot this conference, is that it will exclude and displace residents in an area. Revitalization that is inclusive of all community members will deliver more value to both residents and the city/region as a whole.
BY Guest Blogger on February 4th, 2012
TAGS: housing | economic development | community development | ebdi | baltimore | food | cities | npsg | conference
How two vastly different cities can leverage food cluster
(avg: 4.20 of 5)
There’s an undeniable trend towards Americans seeking healthy, locally grown food. Oftentimes, this is what people understand to be the growing “food movement.” But what people may not realize is that the food cluster encompasses so much more than that: retail and consumption is only the very last end of the supply chain.
At last night’s Open Classroom Series at Northeastern University’s Policy School, ICIC’s Director of Research Teresa Lynch and NextStreet’s Adina Astor gave a presentation that compares Boston and Detroit: how each city has opportunities to leverage its food cluster to create urban jobs.
The researchers broke down some key characteristics of each city as they matter to the food cluster:
BY Amanda Maher on February 2nd, 2012
TAGS: detroit | boston | jobs | businesses | economic development | manufacturing | retail | industrial | food | clusters
Angel Funding Helped this Small-Business Owner Improve the World through Chocolate
(avg: 4.00 of 5)
Sarah Endline grew up in a small farming township of 500. Somewhere along the way dreamed of building her own mission-based business. After years of contemplation, she founded Sweetriot, a small company based in New York City who’s aiming to improve the world through chocolate.
Sweetriot produces tiny nibs of cacao bean covered in dark chocolate and packaged in tins decorated with images from emerging artists. The eco-friendly treats, which satisfy a demand for purer free-trade foods, have been stocked in retail chains including Whole Foods, Wegmans and Zingerman’s. The company has experienced rapid growth in both revenues and product locations since its 2005 founding.
To help the company expand, Sarah sought angel funding as a compatible source of capital. As we learned from last week’s CEO Series Webinar, individual angels or angel groups can serve as valuable financial partners for high-growth businesses seeking below to $2 million in investment. To date, Sarah has successfully secured over $300,000 in angel funding. Below she provides tips to other small-business owners seeking or considering angel financing.
Angels come in all sorts of shapes and sizes. There are four tips I can pass on to fellow entrepreneurs:
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Angels are individuals
Although they appear as groups, angels often they make individual decisions. It is important to get to know them on an individual basis. Even if a group says no, there are entrepreneurs that sometimes raise from individuals alone.
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Angels are regional
Most angel groups say they will look at deals from any region, but if you study their track record they focused on companies they can visit and interact with on a local basis. There are a few exceptions to this but not often.
BY Guest Blogger on January 31st, 2012
TAGS: ceo series | ask the expert | small business | entrepreneur | capital | nyc | angel investment
The Immigrant Artist Who Helped Build Urban Business Success
(avg: 3.00 of 5)
We’ve all heard stories of immigrants moving to the U.S. to find better lives: America is a land of promise, a land of opportunity. These immigrants are a vital force for inner city economies. Businesses on the Inner City 100 list have created roughly 70,000 jobs and employ nearly 100,000 people—40% of which are inner city residents. Many of these business owners open Mom and Pop shops, but others wind up transforming existing businesses.
This is the case with Luc Brami, Principal of Gelberg Signs in Washington, D.C.
Luc Brami’s father came to America from North Africa in 1959. An impressionist painter by trade, he only had $25 in his pocket when he immigrated. He had trouble selling his wares when he first arrived in the U.S., so he went to work for Gelberg doing hand-letter paining for his sign company. He eventually transitioned in to creating logos—including the well-known Marriott logo. Before long, he was Gelberg’s right-hand man.
BY Alex Rodriguez on January 30th, 2012
TAGS: small business | jobs | business | ic100
Tips from an Angel
(avg: 5.00 of 5)
Thank you to everyone who joined us for our first CEO Series webinar of 2012! We were lucky to have Peggy Wallace, Managing Director of Golden Seeds to present “What are Angel Investors Looking for?” The Golden Seeds angel group offers funds to early and growth-stage companies, with a preference for firms headed by women.
Peggy was one of the first investors to join Golden Seeds in 2005 and has since invested in a diverse portfolio of 30 companies. During the webinar, Peggy shared her investor’s perspective to small-business owners who are currently seeking or considering seeking angel investment. Peggy outlined the current angel market and gave tips to entrepreneurs on pitching for investment. Below are a few of the tips and takeaways that stood out to us:
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Angel investors look for companies that have a high-growth trajectory and are scalable. Most often angel groups invest in companies in the technology, life sciences and medical industries.
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The Angel market is a big market – comparable to the venture capital market – both about $20 billion annual investment.
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Angels actually invest in MORE companies than venture capitalists (about 50,000 deals annually) but invest at a lower level. An average angel investment is around $700,000, where an average initial venture capital investment is $5,000,000.
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Acquiring angel investment is usually a 138 day process from when you first apply to when you close. Make sure you build that timeline into your business plan.
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Angels look for a talented management team. If your company is not yet at the stage of having a team, there should be a plan in place to hire. Typically, a portion of an angel investment is put towards hiring.
BY Mary Duggan on January 27th, 2012
TAGS: small business | entrepreneur | capital | ceo series | ask the expert | angel investment
Gambling on Urban Real Estate in 2012? Here are some places to do it
Above: City of Pittsburgh courtesy of Jan Tyler/Getty Images
Pittsburgh, Worcester, Houston, Akron and New Orleans. Five cities that appear very different on the face of things. Some are post-industrial cities trying to position themselves for a comeback. Houston is a post-WWII city based on energy and built via sprawl. And New Orleans—well, we know the challenges New Orleans has faced since Hurricane Katrina.
So what do these five very geographically diverse cities have in common?
According to the forecasting firm Local Market Monitor and as reported by MSN online, these are the five most promising cities for real estate in 2012. A bit of the rationale:
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Pittsburgh: Colleges, hospitals and the health-care industry have helped the city avoid the major job declines faced by other cities during the recession.
- Worcester: High-tech job growth throughout the Boston region has made outer-ring cities an attractive, more affordable alternative to Boston.
BY Amanda Maher on January 24th, 2012
TAGS: cities | real estate | local assets | economic development | housing
What the Deepening US Competitiveness Problem Means for Urban Businesses
Source: The Educated Society: http://bit.ly/xoPXGg
Recently, Harvard Business School’s Institute for Strategy and Competitiveness, led by Dr. Michael Porter (ICIC’s founder), released the results of its first annual Survey on U.S. Competitiveness. The survey sought to pinpoint the roots of the country’s competitiveness problem. Specifically making their definition of competitiveness holistic enough to include rising living standards (and by extension employment), the survey provides an interesting snapshot of commercial realities, attitudes, and expectations. Below is an outline of the result’s implications for urban businesses.
1) Urban Employment Continues to Suffer
To state the painfully obvious, America’s economic morass has lasted much longer than most experts originally anticipated. A large majority of survey respondents (71%) expect U.S. competitiveness to decline over the next three years, with worker’s living standards under greater pressure than firm’s successes. As was recently reported in Atlantic Cities, most metro areas won’t return to pre-recession employment levels until 2015—a stunning 8 years after the beginning of the financial crisis. Unemployment results in diminished consumer purchasing power, affecting urban small business directly, but can also result in indirect costs like higher crime rates—impacting not just businesses but entire communities.
BY Sathya Vijayakumar on January 23rd, 2012
TAGS: jobs | economic development | employment | competitiveness | hbs | shared value | study
Good News for Small Business? More Like Mixed Signals from the White House
Photo courtesy of CNN.com
Last Friday President Obama announced a proposal to combine the Small Business Administration (SBA) with five other government offices. If approved by Congress, the proposal will merge the SBA with the core business functions of the Department of Commerce, the Office of U.S. Trade Representative, the Export-Import Bank and the Overseas Private Investment Corporation and the U.S. Trade and Development Agency. The proposal, aiming to streamline the agencies, is part of Obama’s broader executive branch reorganization.
At the same time, President Obama leveraged his authority to elevate the SBA to a cabinet-level agency. The elevated status gives the head of the SBA, Karen Mills, a seat at future Cabinet meetings.
However, Karen Mill’s seat might not be warm for long. If President Obama’s reorganization is approved by Congress, the SBA will immediately lose its Cabinet position.
How’s that for mixed-signals?
BY Mary Duggan on January 19th, 2012
TAGS: small business | sba | politics | entrepreneur
On Second Thought, Maybe U.S. Manufacturing Isn’t Dead: At Least Not in Our Inner Cities
Above: Inside of Unwrapped in Lowell, MA
We hear it all the time. U.S. manufacturing is dead.
Except, that’s not really true. According to the National Association of Manufacturing, the industry supports an estimated 18.6 million jobs in the U.S. – or about one in six private sector jobs. Nearly 12 million Americans (9% of the workforce) are employed directly in manufacturing.
And this manufacturing is still happening in our once-thriving industrial cities. Lowell, Massachusetts is one of those cities. Located just north of Boston, the city is home to over 100,000 residents. It’s location on the Merrimack River made it a hub for textile production during the early 1900s. But as is the case with many older industrial cities, Lowell lost much of its manufacturing when companies moved to the Sun Belt or overseas. In 1931, Harper’s magazine even referred to Lowell as a “depressed industrial desert.”
Today, however, Lowell is gaining a reputation as a hotbed for small business activity within the mills that once housed the textile industry. While many high-tech companies have moved in, manufacturing companies are also capitalizing on the inexpensive real estate and mill space.
BY Alex Rodriguez on January 18th, 2012
TAGS: manufacturing | business | jobs | industrial | ic100 | small business
Revitalizing Cities via “Placemaking”
Above: “Chalk Flood” at Rosa Park Circle, Grand Rapids
Back at the CEOs for Cities conference in October, a panel of mayors all overwhelmingly described their interest in attracting young, talented workers to their cities. Mayor Mick Cornett explained how he went as far as attracting the Oklahoma City Thunder basketball team to the city – because all young people love sports, right? It must give them a way to identify with their city.
Aside from this example, few mayors explained how they planned to attract this young, “creative class.” And certainly, cities should not haphazardly start bidding for sports teams as a recruitment strategy.
So what can cities do?
There’s a rising movement toward “placemaking” – i.e. strategically creating places that people gravitate to because they are appealing and enjoyable.
BY Amanda Maher on January 17th, 2012
TAGS: economic development | cities | community development | jobs | workforce | grand rapids | knight foundation
Starbucks, Silicon Valley, and US Government Take Aim at Local Biz
What do Starbucks, Silicon Valley, and the Obama administration have in common? While it sounds like the lead-in to a bad joke, they’re all trying to jumpstart job growth by facilitating local commerce and investment at scale. We’ve written many times in the past about inner city companies’ capital access challenges and their unfavorable growth compared to their non-urban peers. It only seems right to start off the New Year on an optimistic note about ambitious projects being executed to remedy these disparities.
Starbucks Create Jobs for USA Project
“Thanks to my CDFI’s investment, we can bring our products to new markets and continue to lead in the fast-growing market of at-home pizza making.”
- Brad Sterl Jr., Rustic Pizza
BY Sathya Vijayakumar on January 11th, 2012
Why Your City Matters to Your Business
Here are 5 reasons your city makes a big difference to the success of your business.
We all hear about the critical role that businesses play in the competitiveness and economic growth of our cities. But it’s important to note that the reverse is also true: Your city has a tremendous impact on your bottom line. Your city means more to your business than just an address on the front door. Your company’s location drives business formation, strategy and performance. It’s called economic geography – and it’s a two-way street.
I’ve challenged my graduate students – all of them entrepreneurs and small business owners – to consider the question of place: How does your city support your business growth?
City industry clusters help businesses thrive.
If birds of a feather flock together, so do similar businesses: biotech companies gather in Cambridge, energy companies gravitate toward Houston, athletic apparel is huge in Portland, Ore., and finance clusters in New York City. The close proximity creates a synergy that enables companies within the cluster to easily collaborate, influence local policy investments, share specialized training programs and partner with service providers...
BY Steven Pedigo on January 10th, 2012
One Small Step for Anti-Sprawl, One Giant Leap for Houston Economic Development?
Big houses. Big cars. Big hair. Welcome to Texas: the state where “everything is bigger” – including big dreams of turning absolutely nothing into empires. No city more accurately embodies this spirit than my hometown of Houston.
The fourth largest city in the U.S., Houston is largely known for being the epicenter of the energy industry, home to NASA and site of one of the largest hospital districts in the world. The city boasts assets like the Houston Ship Channel, which allows oil and petrochemical tankers easy access to local refineries (the city has the largest concentration of oil refineries in the world).
Houston is also a major immigrant hub from cities across the globe. One little known fact: Outside of California, Houston is the largest home to Vietnamese immigrants in the country. As a result, the city has a dynamic, cosmopolitan culture that has resulted in a diverse local economy that is the envy of much of the rest of the country.
But for every positive thing about Houston, another challenge exists....
BY Alex Rodriguez on January 9th, 2012
TAGS: houston | sprawl | economic development | density | transit | business
CDFIs Starting to Show Their Potential
We’ve heard it time and time again. One of the biggest barriers to growth for small businesses and early-stage entrepreneurs is access to capital. In inner cities, this is a hurdle that can be especially difficult to overcome.
The Community Development and Policy Studies Division of the Chicago Fed recently featured CDFI banks as the topic of its “Profitwise News and Views Spotlight.” We’re excited to read about the recent developments in CDFIs (Community Development Financial Institutions), not only because the program’s mission is to help financial institutions provide capital and financial services to America’s underserved communities, but also because we have been examining its impact within inner cities as part of our capital research.
The report outlines the importance of CDFIs and then suggests how the program might be able to expand in the future. Here are some highlights of the Chicago Fed Spotlight:
- CDFI banks increased by over 35% from 2009 to 2010 (with 30 newly certified banks) thanks largely to the launch of the U.S. Department of the Treasury’s Community Development Capital Initiative (CDCI), which required CDFI status to be eligible for its low-interest secondary capital deposits....
BY Mary Duggan on January 6th, 2012
TAGS: capital | cdfi | small business
How a Unique Vision Attracted International Financing to Akron's Urban Core
Above: UP Akron's new Executive Director, Eric Johnson
By: Diane Evans
You do not have to look too closely at our nation’s checkbook to realize the extent to which cities will struggle in 2012 to transform into increasingly competitive and lively communities. Urban redevelopment will happen in cities that are creative, specific and unified.
Akron, Ohio, is an example of a city that is positioning itself well, having a master plan for growth that seeks to trigger hundreds of millions of dollars in development in 2012 and beyond.
Surprised? If so, it is understandable. Akron is the former Rubber Capitol of the World, a city with an industrial heritage. As such, its economic challenges reflect that of many other “legacy cities” struggling to recover from deep manufacturing losses.
Consider this profile of Akron from the U.S. Census Bureau’s American Community Survey 2010:
· Unemployment at 16.2 percent in Akron, compared to a national average of 10.8 percent;
· Median household income of $31,171, compared to $50,046 for the nation as a whole;
· Population that declined 8.3 percent since 2000 while the nation’s population increased by 9.9 percent during the same period.
With major support from the Knight Foundation, Akron’s nonprofit real estate development corporation, University Park Alliance (UPA), is drawing on existing resources – including a community spirit of collaboration – to help turn the tide....
BY Guest Blogger on January 4th, 2012
TAGS: economic development | akron | university park alliance | anchors | knight foundation
Cities have lower mortality rates, and that’s not all: Why cities matter
Above: Image from the cover of Glaeser's new book "Triumph of the City"
It should come to no surprise to anyone familiar with the work of ICIC that we’re a firm believer in cities acting as engines of economic growth and opportunity. That’s why we were delighted to read a recent article in European Magazine that interviewed one of our favorite urban economists – Harvard Professor Ed Glaeser, who also happens to be a huge proponent of investing in our cities.
We’ve heard Glaeser speak several times this past year, perhaps as a result of our overlapping work, or perhaps because Glaeser is on a whirlwind speaking tour for his new book, Triumph of the City. We had the opportunity to chat with him at the “Smaller Industrial Cities” conference here in Massachusetts, and were excited to see him speak at the CEOs for Cities annual conference in Chicago back in October. And of course, there are the two copies of his book sitting on my own desk at home (excessive? Perhaps…)
Yet, despite the times I’ve heard him speak, or the chapters of his book I’ve flipped through, I still found theinterview with European Magazine to be captivating. He reiterated a few things we already knew about cities, but brought to our attention some interesting new perspectives about cities and their governments....
BY Amanda Maher on January 3rd, 2012
TAGS: cities | environment | ed glaeser
Local Food Movement and the Intergenerational Factor
Photo courtesy of www.theburlapbag.com
By Sharon McMillan, New Urban Mom
Consider this statement: The local food movement is a romantic movement that gives urban cheerleaders and regionalists an anchor upon which to turn ideals into practical strategies. I think many well-intentioned people would agree that the effort we are putting into keeping more dollars in our community is not the magic pill for our economic challenges. It is, however, a step in the right direction that requires a fully integrated and inter-generational approach to sustainable cities and regions.
Countless publications have already asserted that initiatives established to re-jig our economies by boosting local food production aren’t about to replace the thousands of jobs being lost in this current economy. In fact it won’t even come close at this point in time.
Yet, even with that knowledge I think there’s an understanding that pushing for the growth of local food clusters and an appreciation for an economy rooted in local resources – natural and man-made – sets the foundation for creating a mind-set and a generation that will in time, I believe, bring prosperity back to many regions in our country.
I’m not a planner or economist, but my perspective on what our cities and regions need is shaped by my role as a parent, working woman and resident. I’m not being narcissistic when I say my perspective is critically important, though I am being slightly facetious. “My” perspective is the perspective shared by the very people who will make the decisions to live and work in the urban centers we need to revitalize.
So as we think about the initiatives that our economies need to be more self-sufficient and attractive to the everyday residents who will have the courage, commitment and vision to turn blighted areas into real communities, let’s look at what “we” want:
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We want safe communities where our children can learn and grow in their environments
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We want our regions to attract forward thinking, successful companies that will provide jobs or business opportunities for ourselves and our neighbors
- We want housing options and cultural amenities that will boost our quality of life
BY Guest Blogger on December 30th, 2011
TAGS: food | community development | clusters
2011 in Review: Our biggest hits
As some of you may have noticed, 2011 was the year ICIC decided to embark on a new social media adventure. We reworked our website, created a Twitter account, and began blogging. It has been a great way to connect with so many of you out there, to share ideas, and to trade best practices for what make our cities and urban small businesses tick.
With 2011 winding down, we thought it would be interesting to look back on our journey and capture what were some of our biggest social media hits of the year....
BY Amanda Maher on December 27th, 2011
TAGS: cities | economic development | food | clusters | shared value | newark | cleveland | nyc
Top 5 Inner City Small Business Predictions for 2012
As ICIC’s research on inner cities has shown, inner cities don’t benefit from regional investment alone; instead, they require targeted strategies and investments to prosper.
In the spirit of this Entrepreneur.com article identifying the top 10 small business predictions for 2012, it seems only right to do the same for small businesses located in the inner city given that macro predictions might not trickle down to distressed urban areas. So, taking the most relevant insights from the broader national picture and ICIC’s own expertise, below are my top 5 Inner City Small Business Predictions for 2012....
BY Sathya Vijayakumar on December 23rd, 2011
TAGS: retail | shared value | small business | business
Cleveland Really Does Rock: My Trip to Lake Erie’s Shore
Above: View of the west bank of the flats in Cleveland from the lower deck of the Detroit-Superior Bridge
In early December with the end of the year fast approaching, I realized I had some time off that I needed to burn. So I booked a quick trip to Cleveland.
Cleveland? Wait, what? Why?
That seems to be the reaction I got out of folks here in Boston. But truth be told, the urban enthusiast that I am, I was actually really excited to go visit this post-industrial city that I’ve read so much about but never experienced first-hand. And it didn’t hurt that I have friends living out there, to boot.
I can best summarize my 72-hours there by saying: Cleveland really does rock....
BY Amanda Maher on December 22nd, 2011
TAGS: cleveland | economic development | food | transit | housing
California SBDC Shows Small Businesses How to Maximize Business via Profit and Loss Statements
In a Q&A with the Los Angeles Regional Small Business Development Center (SBDC), Loan Advisor Bill Sorotsky explains how small businesses can use Profit and Loss Statements to boost their businesses. As the direction of the economy remains uncertain, is it all the more beneficial for small business owners to heed advice such as this.
So what is a Profit and Loss Statement (P&L)?
Also known as an income statement, it is a summary of the company’s profit or loss during a given period of time – traditionally a month, quarter or year. The report details all revenues and operating expenses for the business. The beauty of a P&L is that it outlines for the business areas in which they can reduce costs and boost profits.
But why would you need this instead of just a traditional cash flow statement?...
BY Amanda Maher on December 21st, 2011
TAGS: small business | business | capital
3 Ways the Government Can Fund Your Business
Image courtesy of flickr user vgm8383
We've all heard about SBA loans, but how about NMTCs and CDFIs? Here's how to start cutting through the alphabet soup and get some dough.
We're from the government, and we're here to help.
If, as an entrepreneur, these works strike fear in to your heart, we get it. Nonetheless, the government backs, funds, runs or otherwise supports a number of programs that can help uou find growth capital, and sometimes even startup funds, for your business. They range from the relatively well-known Small Business Administration offerings to Community Development Financial Institutions and the somewhat more complex New Markets Tax Credits. Together, they can provide access to financing and opportunities that would otherwise be missed, even by the most aggressive entrepreneurs.
Here are three sources of government funding every entrepreneur should know about:
To read the entire article, click here.
BY Steven Pedigo on December 15th, 2011
TAGS: nmtc | small business | cdfis | capital | entrepreneur | business
Helping Inner City Residents Help Themselves
Guest blog by Myron Belej, MCIP, AICP
Our inner cities are often marked, characterized and blighted by older, deteriorating houses; higher crime and fire rates; lower incomes; disempowered residents; an array of higher costs; and a need for marketable job skills.
But this doesn’t have to be the case.
Imagine an initiative whereby we train our citizens to fix their own neighbourhoods. Our more progressive cities should take the lead on what I call “Trades-For-Citizens” programs that address all of the above issues, and support every citizen’s right to safe, stable housing.
What Need Fixing?
Our inner city housing stock has often been neglected. Devoid of resources, these homes have fallen in to states of disrepair and face problems like structural issues, flood damage and high fire risks.....
BY Guest Blogger on December 14th, 2011
TAGS: cities | workforce | jobs | housing | community development
Achieving Greater Cluster-Based Economic Growth by Incorporating Inner Cities
Above: Michael Porter at the 2011 Inner City Economic Summit as he explains the importance of inner cities to regional cluster-based economic strategies
Over the past week, there have been multiple articles discussing the importance of clusters in promoting economic development strategies. Authors argue that while technology has made it easier than ever to connect with one another in a globalized world, proximity to other like businesses is still paramount.
How do we know that place still matters? In a post by Area Development, the author explains:
Sixty percent of the respondents to Area Development’s 2010 Corporate Survey said the presence of activities similar to theirs was a consideration when selecting a site. More recently, a 2011 Brookings Institution report showed that “strong clusters foster innovation through dense knowledge flows and spillovers; strengthen entrepreneurship by boosting new enterprise formation and start-up survival; enhance productivity, income levels, and employment growth in industries; and positively influence regional economic performance.”
Industry clusters, as defined by Harvard Business School professor and ICIC founder Michael E. Porter, are geographic concentrations of interconnected companies, specialized suppliers, service providers and associated institutions in a particular field that are present in a specific geography. Clusters arise because they increase the productivity with which companies can compete.
In a separate article on Area Development, Christopher Steele notes that, “From a competitive perspective, the cluster permits access to specialized information on the market. This includes general market conditions, technical information on the network of providers and partners. It also provides real-time information on one’s competition through direct interaction in the local network. This in itself can drive innovation.”
The importance of clusters has not subsided, as some have argued....
BY Amanda Maher on December 12th, 2011
TAGS: cities | clusters | food | economic development
When Government gets it right: Public Programs that helped one Inner city company expand
The 661 unique Inner City 100 winners have been illustrations of the grit and tenacity necessary to make it in today’s extremely volatile business climate. With worries of economic uncertainty at home and financial uncertainty abroad in Europe and elsewhere, our Inner City 100 winners have had to find opportunity wherever and whenever it comes knocking. They have had to find the right segments to serve within the private, public and non-profit sectors.
Team Henry Enterprises found its growth potential through public sector financing programs and then public sector contracts. This 2-time Inner City 100 winner (#59 in 2011) is based in Newport News, Virginia with CEO Devon Henry at the helm.
The company is an SBA certified 8a participant, a registered Disadvantaged Business Enterprise, is located in a HubZone – all of which open funding opportunities for the growing business. They can use these certifications to leverage government contracts, grow networks to fund the scaling of their operations, and even find other small businesses within the area with which to conduct their business.
But how did Team Henry get to this point?....
BY Alex Rodriguez on December 8th, 2011
TAGS: ic100 | small business | sba | entrepreneur | partnerships | mwbes
Transforming an Industrial Weakness in to an Asset
Above: NYC's "High Line"
Cites with industrial histories often face questions as to what should be made of former industrial space. Should old factories be turned in to schools? Should warehouses be converted in to loft-style apartments? Should railroad tracks be torn up so a bike path can be installed?
Similar questions were raised in New York City back in the 1990s. What should be done with the 1.5 mile elevated industrial railroad track that was built in the 1930s? This “High Line” was once used for freight traffic, but hadn’t been in operation since its last run in the 1980s. Shortly thereafter, residents began fighting for the unsightly tracks’ demolition. Others urged a new rail service to be created. The battle over the High Line as compounded in the late-1990s when another group began pushing for a project that would turn the infrastructure into a system of public parks.
Adaptive reuse won....
BY Amanda Maher on December 5th, 2011
TAGS: nyc | economic development | industrial | urban design
Flying Back from the Brink
With American Airlines being the most recent high-profile bankruptcy, one has to ask what you do with a company that still has a market that needs to be served but has been driven to the brink.
This brings us to number 40 on the 2011 Inner City 100, Aztec Promotional Group, a promotional licensing company (t-shirts, pens, mousepads, etc.) based out of Austin, Texas. It was originally owned by Alejandro Vazquez with whom its current CEO, Patti Wistanley, became familiar through her son, a student at the University of Texas. At the time, the business was in serious decline and Vasquez was looking to get rid of it. Patti and her family had an operation where they took over companies that were in trouble (often in bankruptcy); they were appointed by the courts over the management of the Aztec when it filed for bankruptcy in 2004. Patti, however, bought the company with the hope of turning it into a high-growth firm that, in 2008, did $1.8 million in revenues.
Aztec’s location near University of Texas at Austin—one of the largest universities in the United States—has proved beneficial in turning the company around. The company develops promotional materials for the University, as well as many of the student organizations affiliated with the University. The majority of the company’s business comes from universities looking to print items such as championship t-shirts or promotional items. As Aztec adds more universities to their wingspan, they will be able to add more and more clients.
Patti has found the procurement networks for the universities to be difficult to navigate; she believes you have to know the right person to gain some sort of access. The progression is further drawn out when the company has to explain its supply chain processes and unique competitive advantages. These are challenges she was ready and willing to combat.
Getting a bankrupt company back to a point of sustainability was going to be quite an obstacle. The biggest challenges included re-building the company’s reputation and showing customers that they could follow through on jobs despite the company’s financial circumstances. As market conditions have evolved over the last few years, organizations have tightened budgets. Companies now shop around more than ever before.
BY Alex Rodriguez on December 2nd, 2011
TAGS: small business | jobs | ic100 | entrepreneur
Urban Business-Owners Share Their Biggest Challenges
Photo: Executives from Energetic Energy at the ICCC National Matching Day
Earlier this month ICIC and Bank of America convened over 125 urban business-owners in New York City for the Inner City Capital Connections National Matching Day. This day was dedicated to helping inner city entrepreneurs access capital which, according to ICIC research, has proven an obstacle for the vast majority. While the business owners were practicing their pitch to investors through speed-dating sessions, BusinessNewsDaily caught up with some of the participants to get an idea of what some of their biggest challenges were.
Below are the top 10 challenges the ICCC participants reported facing as urban small-business owners.
1. Access to capital...
BY Mary Duggan on November 28th, 2011
TAGS: capital | small business | business | entrepreneur | jobs | iccc
This Thanksgiving, We're Thankful for Small Business Retailers
Gearing up for holiday shopping? Looking to fill those stockings and find the perfect gift for your loved ones? Below you'll find 4 retailers around the country that you should not miss visiting on American Express’s Small Business Saturday.
According to a study by Civics Economics, analysis and strategic planning consultants out of Austin, Texas, 68 cents of every dollar spent at a small business stays in the community. The same study found that only 46 cents of each dollar spent at big box retailers stayed in local communities.
On November 26, support local communities by shopping at your favorite local retailer and take advantage of a host of promotions surrounding the event. ICIC, over the years, has worked with a lot of excellent firms and we would feel remiss if we didn’t highlight a few must-visits for the holiday season...
BY Sathya Vijayakumar on November 23rd, 2011
TAGS: small business | business | jobs | entrepreneur | ic100 | retail
TRE Networks: Uncovering Regional Cluster-Based Economic Development Strategies
As you may recall, in October ICIC held its annual Inner City Economic Summit – or “Urban 2.0” – to address the challenges facing our inner city economies. One of the most riveting presentations at the Summit was by ICIC founder, Dr. Michael E. Porter. Porter, an expert on inner city economies, indicated that the debate about cluster-based economic development is over; it works. He explained that it’s now time to move on to the implementation phase, or the “next frontier.”
TRE (Transformative Regional Engagement) Networks is hosting its annual roundtable, Dec. 5-7th, to uncover what this “next frontier” might look like. With cluster-based economic development at its core, the roundtable seeks to identify ways to “make regionalism work.”
Topics at the TRE Roundtable vary, but include: how to form a coalition to promote advanced manufacturing in the Great lakes mega-region; the topic of “economic development and equity: achieving scale” – which will look at how people and places can connect to growth and opportunity rather than holding back progress; and the role of universities in promoting regional economic development.
BY Amanda Maher on November 22nd, 2011
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Small Business Saturday: Free Promotions to Help You Get the Most Out of November 26
"Nine in 10 Americans believe small business success is critical to the health of the U.S. economy, and Small Business Saturday translates this sentiment into dollars and cents for independent retailers." – Maryann Fitzmaurice, senior VP of American Express OPEN
Inaugurated last year, American Express’s Small Business Saturday aims to drive holiday shoppers into local, independent retail stores across the country on the Saturday after Thanksgiving (November 26, 2011). Building on last year’s success, sponsors across the corporate landscape have created promotions to make this year’s installment even bigger. For your convenience, we have compiled a list of free promotions whether you’re a curious small business or an excited shopper.
BY Sathya Vijayakumar on November 17th, 2011
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Convening Anchors to Promote Shared Value
ICIC was back in the Big Apple this week after having just been there last Thursday for ICCC’s Match Day.
ICIC Chairman Michael Porter and CEO Mary Kay Leonard were there to join Deputy Mayor Robert Steel and Department of Small Businesses Services Commissioner Rob Walsh. Jointly, they convened local higher education leaders and city officials at Gracie Mansion. The session – “New York City’s Anchor Institutions: From Social Responsibility to Shared Value” – included a presentation and discussion led by Professor Porter on how the city’s colleges and universities can build shared value with the economically distressed communities around them.
Turnout for the event exceeded expectations due to much excitement about the day's agenda. The 80+ attendees included presidents and top deputies from 23 of New York City’s leading colleges and universities across the five boroughs.
By way of background, anchors are large institutions, typically educational, medical or cultural, that are deeply rooted in their local geographies. They play an integral role in the economy and can have deeper local impact by targeting their core activities. Nationwide, urban-based colleges and universities provide 2.4% of private sector jobs and spend $175 billion on goods, services, and salaries and benefits. These institutions have added 12.5% of jobs from 1998-2009.
BY Amanda Maher on November 16th, 2011
TAGS: economic development | nyc | anchors | upenn
ICCC's Match Day: Filling an Inner City Capital Gap
Image courtesy of Fortune.com and CNNMoney.com
Last Thursday, November 10, hundreds of investors and companies flocked to Fortune headquarters in NYC for the 7th annual Inner City Capital Connections (ICCC) match day.
Inner city companies are nearly five times more likely than non-inner city companies to finance growth through personal assets, friends, and family. Exacerbating the problem, the number of commercial bank branches located in inner cities declined by 8% between 1998 and 2007, even as the number of commercial bank branches nationwide increased by 27%. Through targeted sessions and live investor feedback on pitches, ICCC serves an unmet need by increasing the financial sophistication of inner city entrepreneurs and introducing them to capital providers.
After a brief introduction, company presentations began by Dero Bike Rack Company, InfoPeople Corporation, Dental Kidz LLC, Victory Personnel Services, and AVPOL International. These firms ranged from one company that makes artistic bike racks to a software project development firm; the pitches and subsequent feedback not only primed companies in the audience for their own pitches later in the day, but also upended caricatures of inner city firms.
BY Sathya Vijayakumar on November 15th, 2011
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In just two years, over 500 small businesses experience growth
Above: Angelica of Colmex Construction, one of the Goldman Sachs 10,000 Small Businesses initiative participants.
It’s no secret: small businesses drive our economy. According to the Small Business Administration, they account for 99.7% of all employer firms, half of all private sector workers and have generated 65% of the net new jobs over the past two decades. Here at ICIC, we realize that finding ways to support small businesses will help to revitalize our inner city economies.
That’s why we’re proud to partner with the Goldman Sachs 10,000 Small Businesses initiative— a national, multi-year investment to create jobs and economic opportunity by providing entrepreneurs with greater access to business education, financial capital and business support services.
The initiative’s unique model is implemented nationwide by community colleges, Community Development Financial Institutions (CDFIs) and community organizations. It is currently operating in New York, Chicago, Houston, Los Angeles and New Orleans—with more cities in the near future! By year end, more than 500 businesses will have benefited from the program and significant growth already has been achieved...
BY Amanda Maher on November 14th, 2011
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Today is CAPITAL DAY here at ICIC!
A key driver of business success is access to financial capital. Businesses often have capital needs that are not met, especially businesses in inner cities.
We’re on a mission today to change all that.
How? We’ve got two ways.
First, we’re in Washington, D.C. at the Federal Reserve. Our research team is presenting Capital Availability in Inner Cities: What Role for Federal Policy?As the title suggests, the paper looks at the role federal policy has in ensuring access to capital for inner city businesses....
BY Amanda Maher on November 10th, 2011
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With ICCC education, Facilities Connection Soars
Policymakers often talk of helping “job creators” with temporary programs like tax credits in exchange for new hiring or “Cash for Clunkers.” While ameliorative and perhaps necessary given institutional constraints, the dominant problem that has plagued global industry since the financial crisis hit in 2008 is credit access.
In a macro environment of tight capital, it comes as no surprise that already capital-scarce inner cities are still struggling to grow companies and communities. Of interest to policymakers may be that significant gains can be made just by educating inner city companies on how to attract financing, and then letting the market choose winners.
Facilities Connection, a global modular solutions company from El Paso, Texas provides an excellent case study....
BY Sathya Vijayakumar on November 9th, 2011
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Hiring Less Highly-Skilled Workers as a Business Model? How this IC100 Company makes it work
The term “urban revitalization” has often conjured up images of rapid gentrification. Firms of all shapes and sizes have often contributed to such an epidemic, seeing urban development as a solid market opportunity where value can be maximized. Some firms, however, have located in inner cities because they realize there’s an existing opportunity to create shared value—i.e. making a profit while simultaneously making the neighborhood a better place for the residents and businesses that call it home.
Boulevard Group of Atlanta is just one of those companies—and it landed them spot #73 on the 2011 Inner City 100 list. The company provides planning and management services for affordable housing developments. In addition, the Boulevard Group is starting to create their own private communities that they will own and operate; this business line will be fully developed within the next five years. The company has operations in Huntsville, Alabama and Chicago, Illinois.
Boulevard Group was established in 1997 by James Brooks as a planning and program management firm specializing in capital projects for public agencies. As the former Deputy Executive Director of the Atlanta Housing Authority from 1994 to 1997, Brooks was responsible for the planning and development of the Olympic Legacy Program which consists of five mixed-income communities that reuse of the Olympic Village from the Atlanta Games. The development was viewed a successful model nationwide and earned Brooks a reputation as one of the leading authorities in affordable housing development and management.
Brooks actually started Boulevard Group when he was tapped by Secretary of Housing and Urban Development Andrew Cuomo to provide expertise and consulting services to a number of communities across the country that were struggling with their housing developments and associated problems. The company initially started with just Brooks but has grown to over 20 full-time employees in three U.S. offices. Boulevard Group positions itself as one of the country’s only full-service community planning firms, providing a one-stop for the project development, management and social services needed to operate an effective housing development...
BY Alex Rodriguez on November 7th, 2011
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Today, we're in NYC to build Opportunity
The Big Apple: It’s an iconic U.S. city that represents our nation’s history of immigration, economic opportunity and freedom. It’s no wonder that NYC was chosen as the host city for Opportunity Nation’s annual Summit—and we’re happy to join them today to hear stories of inspiration, to learn about new growth opportunities, and to hear leaders share their vision for the future of the American Dream.
By way of background, Opportunity Nation is a coalition of nearly 200 businesses, non-profits, educational institutions and military organizations founded to promote economic opportunity and social mobility. They strive to create better skills, better jobs, and better communities. Opportunity Nation is a campaign run through Alan Khazi’s (founder of CityYear) Be the Change, Inc. organization.
ICIC was an early coalition partner of Opportunity Nation because we believe that America cannot succeed if we do not address the economic inequality in this country. Our inner cities disproportionately suffer from high unemployment and poverty rates. For example:....
BY Amanda Maher on November 4th, 2011
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Meeting the Right Financial Partner
Inner City Capital Connections (ICCC) is just around the corner! Next Thursday, over 100 inner city entrepreneurs will pitch their companies to potential investors in New York City. The matchmaking event will include a series of “speed-pitches” with investors representing private equity, venture capital, angel networks, mezzanine financing and debt. The day is not only about making deals—but making the right deals that fit with the entrepreneurs’ business growth plans.
Coming off of the October 20th capital education training in Detroit, these entrepreneurs are equipped with the knowledge needed to communicate with investors. The 125 companies participating in the program were selected out of a record-setting 3,200 company nominations based on their strong growth potential and commitment to the inner city. Many of the participating companies are ready to grow, and after attending ICCC, are able to do just that.
Micron Electrical Contracting of Detroit is one of those companies.
BY Mary Duggan on November 3rd, 2011
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Small Business Owners, Rejoice! 10 new tips to help you find your angel
Happy November, friends! As we've learned here at ICIC, access to capital is one of the strongest barriers facing inner city companies. We've heard countless stories about how, when able to access capital, urban businesses can thrive. As such, we thought there was no better way to kick off the month with a few new pieces of insight from someone who is all too familiar with small business development. On the agenda: How small business owners can better connect with angel investors.
Rieva Lesonsky shared her "10 Tips for Finding Angel Capital" with Los Angeles Regional Small Business Develpment Center (SBDC) Network. Ms. Lesonsky is founder and President of GrowBiz Media, a company that helps entrepreneurs start and grow their businesses. Before launching her business, she was Editorial Director of Entrepreneur Magazine. We found her advice to be pretty useful, and wanted to share her tips with you as well. So here goes:
BY Alex Rodriguez on November 1st, 2011
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Housing led us in to this recession. It will have to lead us out.
In back-to-back weeks, I found myself sitting alongside industry peers at The Boston Foundation. This time, we were there for the presentation of the 2011 Greater Boston Housing Report Card—an annual report put together by Northeastern University’s Dukakis Center.
Briefly, the report explains that at the core of our nation’s recession is the collapse of the housing market. The authors write that until the housing market recovers, there is little hope for increased economic growth.
As for Greater Boston, the region’s housing market has outperformed national averages. Production has not declined as much as in other areas (think: Las Vegas and cities that were in the midst of a construction boom when the housing bubble burst), and housing prices have not tumbled drastically.
The report finds that despite this (relatively) good news, Greater Boston’s inner city areas continue to be plagued by foreclosures.
BY Amanda Maher on October 31st, 2011
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GROWING Community and Business
Last week the Inner City Capital Connections (ICCC) program hosted an unprecedented number of participants at its training session in Detroit. Over one hundred investment-ready inner city entrepreneurs gathered to learn about equity and other sources of capital to help them grow their businesses. Detroit was well represented by its entrepreneurs, with 24 small business CEOs participating and one alumna CEO providing baked goods for all the participants. Avalon International Breads participated in ICCC in 2010 and has since grown its business in Detroit.
Avalon International Breads has always been more than just a bakery. The two founders, Jackie Victor and Ann Perrault, wanted to build a business that would, in their words, “rebuild, respirit and revitalize” Detroit.
BY Mary Duggan on October 28th, 2011
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How Can Interest-Based Bargaining Improve our Inner City Economies?
Over the past few weeks, I’ve attended both our own Inner City Economic Summit and the CEOs for Cities annual meeting. These meetings convened top-level private, civic and nonprofit leaders from across the country to discuss ways to improve economic development initiatives in our cities.
A prevailing theme from both conferences was the need to improve education. At the Summit, education focused primarily on workforce development initiatives and creating a strong education pipeline (particularly for jobs in the industrial sector). At the CEOs for Cities conference, I learned about improving K-12 education, community colleges and investing in our research institutions. But the same conclusion could be drawn from both events: education is vital to the health of our inner city economies.
Last week, I visited The Boston Foundation for the release of Toward a New Grand Bargain, a report by Northeastern University’s (and my graduate school advisor) Barry Bluestone and Professor Tom Kochan of MIT. At its core, the report acknowledges that cities are in a time of fiscal austerity—and as such, public sector unions are being attacked, and in some cases, dismantled. In order to protect total breakdown between political leaders and civil servants, we should move from a system of adversarial bargaining to “interest-based bargaining” (IBB). The report focuses primarily on doing so in Massachusetts’ educational system; but the same approach could be applied to all public unions...
BY Amanda Maher on October 26th, 2011
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Cluster Development as an Economic Driver for Inner Cities
Earlier today, our friends at UC Berkley’s Network on Building Resilient Regions posted a blog entry on their website that looks at how cluster-based economic development can be used to drive inner city growth. The entry draws on a recent presentation by Harvard Business School professor, and ICIC founder, Dr. Michael Porter, at ICIC’s Inner City Economic Forum earlier this month. Here is an excerpt from the blog:
“Latch on to any cluster you have and upgrade it. There is no bad cluster.”
—Michael Porter, professor, Harvard Business School, [founder] ICIC
When casting about for ways to spark innovation and economic growth, many metro areas opt to poach from neighboring states or court a certain industry with tax breaks and other incentives. Rather than looking at one’s neighbors as competitors, metros should look across state or local lines to their region’s strengths, legacy industries, and population, and band together instead.
At a recent conference of the Initiative for a Competitive Inner City, founder and chairman of Michael Porter, spoke of such cooperation in the form of clusters and their power to spark development. Clusters are a critical mass of firms in a given location in a given field. A food cluster, for example, would include wholesale providers, inspection firms, distribution firms, machinery, and so forth. As a critical mass, clusters promote efficiencies that individual businesses or industries cannot. They take advantage of pools of employees or suppliers or other economies of scale.
BY Steven Pedigo on October 25th, 2011
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IC100 Companies: Using Market Knowledge to Identify High-Growth Market Opportunities
Many CEOs of high-growth firms, specifically those seen on the Inner City 100 over the past 13 years, have taken the skill they knew best (artistic design, programming, building and fixing things around the house, etc.) and made a business of it. In many instances, the leaders of these companies worked for another firm when they realized there was an opportunity for them to step in, offer better services and fulfill a market need.
This strategy has not been lost on one particular 2011 Inner City 100 winner, Pittsburgh, Pennsylvania-based Network Deposition Services and its CEO Terri Urbash. Founded in 2005, Network Deposition Services (NDS) is a full-scale court reporting and legal videography firm and finished #16 on the 2011 Inner City 100 list after posting a five-year compound annual growth rate (CAGR) of 64%. As of 2009, the company had 29 employees and approximately $1.8 million in revenue.
Urbash was a full-time court reporter with another firm, but found that she wanted to spend more time with her children so she became an independent court reporter. From there, she decided to start her own firm where she contracted out to other court reporters. She quickly realized that to be a full-scale court reporting firm, she would need full-time employees. Urbash began with just her equipment and $100 in the bank to buy letterhead. Within a year, she opened an office in downtown Pittsburgh and the company was born.
Given her vast experience as a court reporter in Pittsburgh, Urbash not only had a wealth of knowledge of the industry but also unique knowledge of the local market....
BY Alex Rodriguez on October 24th, 2011
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The Inner City Economic Summit: Identification of Assets and Burgeoning Opportunities
Earlier this month, ICIC convened a group of high-level corporate, nonprofit and civic leaders from across the U.S. to address challenges facing our inner city economies. Yet as ICIC’s research has shown, our inner cities are also flush with assets. From a readily available workforce, to anchor institutions, to (in some cases) an abundance of land – unique assets in inner cities offer significant opportunities for job growth and prosperity. At the Inner City Economic Summit, we explored these opportunities.
Through presentations and individual conversations, we were not only able to share ICIC’s own research, but we also learned from the 250+ attendees at the conference. Here are a few of the themes that seemed to boil to the top and really stuck with us:
BY Amanda Maher on October 19th, 2011
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Through Diversification, One Company Brings Value to Inner City Oakland
“One thing we know about creativity is that it typically occurs when people who have mastered two or more quite different fields use the framework in one to think afresh about the other… But if you spend your life in one silo, you will never have either the knowledge or mental agility to do the synthesis, connect the dots, which is usually where the next great breakthrough is found.” – Marc Tucker, President and CEO of the National Center on Education and the Economy
As facets of our society continue to become more specialized, it is useful to remind ourselves that, for much of Western history, diversity of achievement was exalted as the truest testament of talent.
While the mention of Leonardo Da Vinci evokes images of the Mona Lisa and the Last Supper, less well known are his visionary sketches of tanks and helicopters and his contributions to the futures of manufacturing and geology. Perhaps then, the modern trend towards specialization can be viewed as a lens through which distinct problems can be solved. Just as Facebook brought another layer to Myspace and Pandora (number 2 on last year’s Inner City 100 list) combined the best of radio, professional taste, and individual preferences, firms across the country are creating value by cross-applying expertise.
So it was for Santiago Cuenca-Romero, CEO of Premier Organics, #21 on last year’s Inner City 100 list...
BY Sathya Vijayakumar on October 17th, 2011
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What I heard at the CEOs for Cities Conference
After a multi-hour flight delay at O’Hare, I am finally situated and in the air; finally heading back to Boston. For the past two days, I’ve been in Chicago at the CEOs for Cities conference. With Lee Fisher at the helm, the organization brought together civic leaders from across the nation for two days of discussion about the challenges faced by our cities.
The panels ranged in expertise and scope: we heard from the Secretary of U.S. Housing and Urban Development (HUD), Shaun Donovan, about how the federal government is supporting cities; we learned that Chicago’s public-private partnerships were generating a bottom-up approach to the city’s revitalization; we discussed the metrics needed to measure exactly what makes a city successful (interestingly, a city’s “weirdness” was a factor!); we heard from thought-leaders like Henry Cisneros and Ed Glaeser on the future of our American cities; and Bruce Mau joined led a provocative conversation about the design of our urban environment.
Throughout these (and others, to be sure) discussions, I noticed a few general themes to what panelists were discussing. Despite the nature of the panel, speakers harped (and, deservedly so) on the following topics:
BY Amanda Maher on October 13th, 2011
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"Jobs Anywhere" is Not Enough
Guest Blogger: Executive Director, Twin Cities Local Initiatives Support Corporation (LISC)
Originally posted on Leadership and Community
The challenge put forth by Harvard professor Michael Porter, chairman and founder of ICIC, was that if we’re to see dramatic change in meeting the employment needs of inner city residents and economic growth in these communities, more focused and customized strategies are needed. He also proposed that focusing on industry clusters, which is much more prevalent globally and increasingly utilized in the United States, can and should be an economic development strategy within distressed urban areas.
Why? Because regional growth and prosperity depends on it.
BY Steven Pedigo on October 12th, 2011
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Small Businesses with Big Community Impact
“The solution lies in the principle of shared value, which involves creating economic value in a way that also creates value for society by addressing its needs and challenges. Businesses must reconnect company success with social progress. Shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success. It is not on the margin of what companies do but at the center. We believe that it can give rise to the next major transformation of business thinking.” – Michael Porter in “Creating Shared Value”
Looking at the small businesses that participate in the Inner City Capital Connections (ICCC) program, one cannot help but notice how deeply today’s companies seem to be incorporating the concept of “shared value” into their core business models. Whether out of conviction or economics, firms are incorporating standards of excellence above and beyond what is legally required and reaping the benefits of their benevolence on their balance sheets. FutureNet Group, a four time Inner City 100 honoree as well as three time participant in the ICCC program, has achieved success far beyond its modest urban accommodations by growing at an annual rate of more than 100% over the last five years. Located in Detroit, Michigan, a city devastated by manufacturing losses, FutureNet Group merits particular attention for its commitment to distressed communities at home and abroad.
BY Sathya Vijayakumar on October 6th, 2011
TAGS: small business | shared value | iccc | detroit | community development | entrepreneur
Thoughts on Food 2.0 by a New Urban Mom
Guest Blogger: New Urban Mom
We are in the midst of tremendous evolution with respect to the relationship between food and urban communities. During the Food 2.0 discussion at the 2011 Inner City Economic Summit, we heard again and again that urban food is evolving and the whole “local food” movement is growing. That’s evident in the thousands of farmers markets springing up not just in far flung suburban rings but smack dab in the middle of our urban cities.
Food is such a core contributor to our emotional and physical well-being that it is no wonder the growth in food clusters in our urban cities is influencing not only our personal food choices but how we feel about our neighborhoods and cities.
More urban communities are re-imagining gardening and urban agriculture not as a solitary pursuit but as a healthy, altruistic and entrepreneurial effort benefiting the community as a whole. Abandoned lots in struggling cities like Detroit and Cleveland are being converted into cultivated plots of land growing produce for commercial output and community education purposes. This is social and economic change at its best.
BY Steven Pedigo on October 5th, 2011
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ICIC Summit Live: Two Days is Never Enough
We’ve spent the last two days gathering urban leaders from across the nation to discuss the future of our inner city economies. We’ve learned how cities can improve access to capital for small businesses. We heard how Chicago, led by the Civic Consulting Alliance, has formed strategic public-private partnerships to promote economic development. We were informed that the largest remaining barrier to growing the industrial economy is lack of education as to what the sector entails and which skills are needed.
Food? We covered that too. After an inspiring keynote by Kristin Groos Richmond of Revolution Food, we heard a cast of panelists discuss the ways we can grow the emerging food cluster to promote job growth and economic prosperity in our nations’ most distressed locations. Rounding things out, we heard that our inner city economies must not be forgotten about in this age of regionalism, as their assets and needs are often very different than the region as a whole.
While we’ve learned a great deal, the reality is that the conversation about our inner city economies cannot end after two days.
BY Amanda Maher on October 4th, 2011
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RT @ellis_still: @JaliaVentures As an fyi, @NJSocEnt‘s New Jersey Social Entrepreneurship Summit is coming up on May 24th. @jrobinsonphd ...
about 6 hours, 10 minutes ago
Looking to drive #smallbiz results? Apply for this no-cost #Chicago program: Goldman Sachs 10,000 Small Businesses http://t.co/WUMhoq7Y
about 7 hours, 4 minutes ago
Personal passions about how to change the world do play a role in how impact investors choose their recipients - @JaliaVentures #CEOSeries
about 8 hours, 37 minutes ago
For impact investors, it's not all about the $$ - #smallbiz need to prove a clear social mission in addition to financial return #CEOSeries
about 9 hours, 8 minutes ago
One mission-driven co that received investment from @JaliaVentures is @MyRedRabbit, a recent #ic100 Company to Watch winner! #CEOSeries
about 9 hours, 15 minutes ago
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