1. Urban Entrepreneurship Al Bogdan

2. Importance of Entrepreneurship Major industries or businesses are located in a specific area because their founders started there. Ford in Detroit - This is Where Henry Converted his Bike Shop into the Modern Auto Assembly Plant. Stryker is in Kalamazoo, Amway and Steelcase are in Grand Rapids; Hewlett Packard in Silicon Valley Starbucks is in Seattle, and Compuware is in Detroit The Future of Our Cities Depends on the Urban Entrepreneur Entrepreneurs Who Mine the Richness of the City

3. Importance of the Urban Environs The City provides a Network Creative Energy, Resources, Finances and People to start and grow a business. Entrepreneurism overwhelms the normal business site location criteria - this is where the entrepreneur’s personal support network is located

4. Characteristics of the Entrepreneur March to Own Drummer Needs to be In Charge Never Fail Every Failure is Only a Learning Experience Hard Working Social Creature Knows How to Listen Knows How to Network Focus on the Vision

5. Urban Entrepreneurism By Michael E. Porter Past Models Have Failed Based on Meeting Needs of Individual Income Assistance Housing Subsidies Food Stamps Economic Development Based on Subsidies Preference programs Expensive Models Housing Real Estate Neighborhood Development

6. Urban Entrepreneurism By Michael E. Porter Answer Private, For-profit Initiatives based on Economic Self Interest & Genuine Competitive Advantage Inner City Businesses Must be Profitable, Positioned to Compete Regionally Nationally, Internationally Translate Competitive Advantageous to Profitable Business

7. Urban Entrepreneurism By Michael E. Porter Competitive Advantage Look at Clusters Customer Relationships Supplier Relationships Critical Mass of Skills, Information, Relationships, and Infrastructure Competitive Companies Push Each other to Improve Products & Processes Grow New Suppliers or Find Existing Create Firms in Related Fields Form Training Programs Form Technology Centers of Excellence

8. Inner City Advantageous Strategic Location Competitive Edge Communication Nodes Logistical Infrastructure Food Processing Operations Printing industry Warehousing & Distribution Entertainment - Tourist Center Museums Galleries Ball Parks Convention Centers Gaming

9. Inner City Advantageous Dense Population Medical Facilities Universities Ethnic Market Greentown Mexicantown Chinatown

10. Inner City Advantageous Overcoming Myths Inner City Residents Do Not Want to Work Industrious & Eager for Jobs Requiring Little Education Only Entrepreneurs Are Drug Dealers Thousands Trained in Social Service Industry Skilled Minorities Have Abandoned Their Roots African Americans & Hispanics Get 4,200 MBAs/Year Thousands Highly Trained People in Major Companies

11. Inner City Development New ModelOld Model Economic Create WealthSocial Redistribute Wealth Private SectorGovernment & SS Agencies Profitable BusinessesSubsidized Business Integration W Regional Eco.Isolation from Larger Eco. Export OrientatedOnly Serve Local Comm. Minorities Building BusinessesMinorities in SS Sector MainstreamSpecial Institutions Created Address Disadvantages DirectlyCounter Balance w Subsidies Government Improves Environ.Government Services

12. Real Disadvantages Land Abundant Small Lots Expensive to Assemble Expensive Demolition Environmental Clean Up Title Conflicts Obstacles Create Opportunity

13. Real Disadvantages Building Costs Negotiation w Community Groups Extensive Permit Process Government Required Minority Set Asides Requirement to Pay Union Wages Livable Wage Requirements Regulatory Process Creates Uncertainty Obstacles Create Opportunity

14. Real Disadvantages Other Costs Permitting & Other Fees Insurance OSHA Compliance Real Estate & Other Taxes Entrenched Bureaucracy – Work Rules Restrictive Licensing, Permitting, Safety & Health Regulations Stunts Entrepreneurship Obstacles Create Opportunity

15. Real Disadvantages Security Perceived & Real Creates Obstacle Full time Security Guards More Lighting Continuous Graffiti Cleaning Impedes Employee Recruitment City Police Focus On Residential Areas Stunts Entrepreneurship Obstacles Create Opportunity

16. Real Disadvantages Employee Skills Average Education Low Unskilled Workers Obstacles Create Opportunity Criteria19701990 % Jobs Held W/o HS Diploma29%7% % Jobs Held by College Grads18%44% Unemployment Rate AA Men19%37%

17. Real Disadvantages Management Skills Managers Lack Formal Training Predictable Problems Strategy Development Market Segmentation Information Technology Securing Financing Interaction w Lenders & Regulatory Agencies Crafting Business Plans & Employee Training Obstacles Create Opportunity

18. Real Disadvantages Capital Barrier to Debt & Equity Capital Small Business Lending Only Marginally Profitable In Business to Attract Deposits & Sell Other Products Community Reinvestment Act Works Direct Government Financing Ineffective Duplicates Overhead Undermines High Quality Private Sector Expertise Obstacles Create Opportunity

19. Real Disadvantages Anti-business Attitudes Businesses Perceived as Exploitive - Legacy Poor Treatment of Workers Departure of Companies Damage to Environment Unreal Expectation of Firms Meeting Social Needs Demand Scholarships Cede Control of Hiring to Community Organization Link Payments & Contributions Drive Businesses Away Obstacles Create Opportunity

20. Changing Role & Responsibilities Create & Expand Business Activity Simply Do Business Seize Opportunities Tailor Goods & Services to Local Market i.e., Sell Winter Coats in the Winter Hire Locally Build Loyalty Organize to Reduce Security Cost Special Assessment Districts Create Large Campus Environment Clean Up Transportation Entrances

21. Changing Role & Responsibilities Establish Business Relationships Joint Ventures i.e., Bing Industries Not Charity – Based on Mutual Self Respect

22. Changing Role & Responsibilities Redirect Philanthropy to Business to Business Efforts Build Around Industry Clusters Training Should be Employer Certified to be Relevant Help with School to Work Transition Provide Management Assistance

23. Changing Role & Responsibilities Adopt Right Model for Equity Capital Attract Angel & Venture Capital Not Technology Model – More Mundane Supermarkets Laundries Franchises Follow Principal of Competitive Advantage Will Generate Appropriate

24. New Role of Government Shift Focus From Direct Intervention to Providing Infrastructure Focus on 4 Goals

25. New Role of Government Goal 1 – Direct Resources to Areas of Greatest Need Shift Funds to Area of Greatest Need Crime Superfund Infrastructure Programs Support Business on Race Ethnicity, or Gender – Change to Economic Need

26. New Role of Government Goal 2 - Increase Economic Value of Inner City Change Regulations To Streamline Permitting Process, i.e., Indianapolis Single Government Entity to Produce Building Ready Sites – Streamline Permitting Zoning Inspections, etc Develop Transportation Infrastructure to Move Goods, Employees, and Supplies

27. New Role of Government Goal 3 – Deliver Economic Development Services Through Mainstream Private Sector Institutions Biased Against Quasi Public Institutions

28. New Role of Government Goal 4 Align Incentives Into True Economic Performance No Direct Subsidies Phase Out Set Aside Over Time Government Funds Site Assembly Extra Security Environmental Clean Up Investments to Improve Business Environment

29. New Role for Community- based Organizations Goal 1 - Identify & Build on Strengths, Based on Unique Competitive Advantages Realistic Assessment Capabilities, Resources & Limitations In Conflict with Community Based Mission Needs to Seek Outside Entrepreneur Need to Permit Dismissing Poorly Performing Workers Assign Prime Sites to Businesses instead of SS Needs

30. New Role for Community- based Organizations Goal 2 – Change Work Force & Community Attitudes Use Advantage to Change Community Attitudes Help Create Hospitable Environment

31. New Role for Community- based Organizations Goal 3 – Create Work-readiness & Job Referral System Play Active role in Preparing, Screening, and Referring Employees to Local Businesses Urban League, Churches

32. New Role for Community- based Organizations Goal 4 – Facilitate Commercial Site Improvement Help Form Merchant’s Association to Identify Business Needs & Barrier’s to Meeting Them Pushed for Increased patrols Pushed to Board up or Demolish Abandoned Buildings Remove Trash & Abandoned Cars

33. Overcoming Impediments Issue Is Complex Requires changing Attitudes by All Sectors Rethink Inner city in Economic Terms Redirect Resources to Economic Terms Foster Wealth creation Fostering Cooperation Between Business & residents