How to Encourage Entrepreneurship in Your Town

A strong town needs strong local businesses. Local businesses provide jobs and opportunities for wealth creation. They can become a draw, encouraging visitors from outside your community, as well as a way for community members to support each other by buying local. Only with a thriving locally-based economy—one that isn’t owned or propped up by someone six states away—can we succeed in creating sustainable jobs and lasting economic prosperity.

Entrepreneurship is a hot word these days. Lots of towns say they would like to attract more entrepreneurs and grow their small business communities. But how do you do it? There are many ways to encourage entrepreneurship in your community, both through government leadership and private sector/neighborhood-level work.


1. Adjust zoning codes to reduce business costs.

Do your zoning codes allow for mixed-use buildings where a shop owner runs her business on the first floor and lives upstairs? Are there minimum parking requirements for new businesses? Are food trucks permitted in your community? These are good questions to ask if you want to encourage small business growth. Buying or renting and renovating a building for a new business can be extremely costly. If your community allows for creative use of space, diverse income streams and smaller options than the typical stand-alone store, you lower the barriers to entry for small business owners.

2. Help facilitate walkable business districts.

Walkability is a huge factor in small business success and can create fertile soil for entrepreneurship to thrive. In a concentrated, walkable neighborhood with shops and restaurants, passersby are far more likely to frequent multiple businesses than if they were just driving to a specific store in an auto-oriented area. And as a bonus, walkable neighborhoods in city after city across the country demonstrate far greater tax revenue per square foot than any other type of development. So help your city move toward walkable neighborhoods by slowing cars in existing business districts, widening sidewalks, and placing public benches and planters to improve the landscape. When you have the choice between using land for a parking lot or a productive business, make the right choice and enable a business instead of car storage.

3. Simplify local regulations for starting new businesses.

Make the business start-up process simple. Instead of forcing entrepreneurs to jump from government office to government office filling out forms and asking questions, create a central space on your local government website that walks business owners through the process of getting started: which forms to fill out, who to contact, how long each step takes, etc. Cut out any superfluous steps if possible. Consult existing business owners in the process to find out how they got started.

4. Dedicate resources to economic gardening .

While it’s important to focus on helping people start businesses, a concerted effort should be put into helping businesses grow. Growth presents a whole new set of challenges. Providing businesses with resources to take their business to the next level is a proven way to strengthen the local economy. Check out our podcast with Chris Gibbons , a leading proponent of economic gardening, to learn more.