Financing: WIP

Yesterday we mentioned community coalitions, and left the concept hanging. Here is what our community is doing to help entrepreneurs.

We are building an entrepreneurship education system for youth, to help them build local businesses, which is not a new idea. But our system will assist students with the whole process, from idea formation to funding.

Our town here is to small to handle this project, so we have joined with some really smart people in Carthage, and together we will roll this out to the whole county. We're creating a coalition of private and public organizations, focusing on the people within those organizations.

Included in the coalition are banks, grant experts, those familiar with USDA loan options, educators, education administrators, and successful entrepreneurs.

Note: this is still a work in progress. 

Financing

The wannabe entrepreneur usually complains about one thing: money. "I've got a great idea/business plan/potential innovation/ but I need funding. And banks are not lending these days."

I've heard this many, many times.

In the current environment, we offer two possible suggestions:

 - Move forward without funding. We call this bootstrapping.
 - Rely on community coalitions that help you find funding.

We'll talk about both of these options.

The new, new economy

The model of business that we have operated under for a century or more is that the firm’s purpose is to lower costs by increasing efficiency. As much as possible, firms safeguard information on how they do this.

Perhaps the new era heralds a different purpose for the firm. Now our responsibility is to increase knowledge, and by synergizing it with the knowledge produced by others we multiply our knowledge. The whole world benefits. 

The U-Turn

In Japan, the term "U-turn" is applied to people returning from the "big city" to their hometowns, and is involved with the career concerns involved with such a move.

When you decide to leave the cube farm (slang for a floor full of cubicles) and move to a place with real farms, you need to find a livelihood.

Here at the Nauvoo Commuter, we encourage self-employment in that situation, as we do for most rural dwellers. But your plan of attack will need to be different from someone who has already lives in your new neighborhood.

 - you won't have as many connections, your local personal network will be 
   smaller
 - you will lack a knowledge of the "lay of the land" that an already local will have
 - your cost of set up will be more, as moving and changing lifestyles have costs

...but:
 - you will bring creativity to the situation; you've seen other options for how to 
   solve problems


If you persevere, you'll do fine. 

Urban Poor vs. Rural Poor

When Americans think of economic development, they are generally envisioning the need to eliminate inner-city poverty. But isn't the problem of rural poverty just as important? 

The Rural poor deserve revolving loan funds, efforts to encourage banks to lend to urban residents, microcredit structures, and charitable help-them-to-help-themselves organizations just as much as the urban poor do. 

That is today's social comment. Dissenting arguments are welcome. 

Accentuate the positive, OR eliminate the negative

Annoyance bears consideration. If you could eliminate one annoyance in your life (with the wave a magic wand), what would it be?

The question is not rhetorical. Please answer. Write it down.

Now, does a business exist that could take it away for you? Could such an industry be created? Could YOU create it?

Accentuating positive aspects of people's lives is admirable. But eliminating their difficulties might be a faster route to success.

And your personal annoyances might be common to others living in the farm belt.

Downgrading and Upgrading

Air travel used to be glorious. People dressed up and dressed their children in "Sunday best" for a flight. It felt special.

Bus travel, on the other hand, was for normal people.

Then deregulation changed the travel industry. The riff-raff like me de-boarded buses and started flying. Airports now feel like Greyhound terminals used to feel. Air travel is for normal people, and a bus terminal is entered only if absolutely unavoidable. You avoid making sudden moves and you never make eye contact with people.

Moving downmarket is easy and profitable. A brand can take years to develop exclusivity, then suddenly Kmart carries it and everyone buys it (for a short time.)

Moving upmarket is more difficult, but does happen. Toyota was for people who needed a car but never needed to drive up hill. But the marketing people delivered a consistent message for give decades: "you made the right decision when you bought a Toyota." People like to be told they didn't do something dumb, so gradually everyone started believing them.

The takeaway: Toyota established their brand just in time. Kia, Hyundai, and a host of other companies would have killed them by now if Toyota had not worked so hard in their marketing. You need to build a brand, go upmarket, differentiate yourself rather than digging in to survive.