RI’S BIPOC ENTREPRENEUR + BUSINESS OWNER NEEDS
In addition to supporting new online lending, Rhode Island should also consider investing in communitybased crowdfunding platforms, which have proved quite successful in providing local investment capital to emerging companies. For example, many communities have created local funds on the Kiva crowdfunding platform, while others, such as the Massachusetts-based Pioneer Valley Grows Investment Fund, have developed their own independent funding pools. In an effort to incentivize the creation of such local funds, the State should consider designating a small matching fund (of $5 million) to invest in local investment pools of this type. Third, Rhode Island should seek to develop additional new sources of investment for BIPOC businesses. These steps might include additional capitalization of existing microloan funds, such as the Rhode Island Black Business Association’s (RIBBA) new forgivable microloan fund. Efforts to stimulate increased BIPOC business investment by Rhode Island’s banking sector should also be pursued. During the pandemic, numerous financial institutions, have stepped up their direct investments in BIPOC-owned businesses and in providing additional capital to Minority Depository Institutions (MDIs). Continued support for these efforts is needed. A related strategy could encourage the development of new angel investor networks targeting BIPOCowned ventures, and the encouragement of new investment in BIPOC companies by existing angel investor networks. In recent years, angel investments have become a more important part of the investment mix for BIPOC entrepreneurs. In fact, the value of initial angel funding for Black entrepreneurs doubled in 2020, and now accounts for 15% of all initial stage angel investing in the US.10
Workforce/Talent When it comes to entrepreneur ecosystems, the concept of talent refers to the ability of local people to learn the skills and competencies needed to become an entrepreneur. Entrepreneurial competency is a mindset and skillset that can be learned from experience, but it can also be taught via workshops, peer connections, or via formal education. Robust ecosystems make it easy for all residents, especially young people, to learn about entrepreneurship as a viable career option. Along the way, local people learn that they have the option to “make a job” as opposed to “take a job.” Rhode Island has a fairly strong base of resources to help people learn about the journey of entrepreneurship. In addition to the business support programs discussed below, many excellent youth entrepreneurship programs are operating in the state. Junior Achievement has a strong presence, as do other business education programs such as DECA, Future Business Leaders of America (FBLA), and the National FFA Organization. Other important non-profit youth entrepreneurship programs include the Network for Teaching Entrepreneurship (NFTE), which is utilized at Providence’s Metropolitan Regional Career and Technical Center (MET). MET students were selected as NFTE’s National Entrepreneur of the Year award winners in both 2020 and 2021. In addition, the state is also home to several local programs, such as Young Entrepreneurs of Providence, supported by Brown University. These existing programs offer great promise, but should be expanded. To do so, the State should set a goal that every Rhode Island-based student should participate in some type of entrepreneurship programming before they graduate from high school. At present, Rhode Island’s education standards highlight some required entrepreneurship training in elementary schools, but no other formal requirements are in place. 11 10
Angel Capital Association, Angel Funders Report 2021. November 2021. Available at: www.angelcapitalassociation.org. 11 Junior Achievement USA, The States of Entrepreneurship Education in America, 2019. Available at: https://jausa.ja.org/dA/22d1d8706c/criticalIssuePdfDocument/JA%20States%20of%20Entrepreneurship%202019. pdf.
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