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How Cities Attract Entrepreneurs and New Business

Cities and states around the country have an economic development office to spur business activity and attract investment in their communities.  When a new business expands or relocates to their region, jobs are created so it’s a no brainer why business development consultants try to lure in entrepreneurs and business executives. Business owners and managers put in a lot of thought of where they have the best chance of succeeding. Here are some ideas for municipal and state economic development teams to keep in mind when trying to recruit new business to the area.

Access to capital is of primary importance to encourage a startup culture. Cities need venture capitalists and angel investors if they hope to attract new business to the area. Entrepreneurs move to cities where they know they have the best chance to access capital in order to carry out their business plans. Investors like to keep their money close to home, so economic development teams must work closely with potential investors and promote the fact that their city invests in people and good ideas.

Once entrepreneurs know there is money to fund their business, they want to know there is a qualified workforce. Even though unemployment is at an all time high, small business owners can still have a hard time finding people with skills that are needed. Economic development teams need to work closely with universities and community colleges to match up the skills of recent graduates with companies that need employees.

Entrepreneurship can often feel like a lonely career choice, which is why it’s important for business owners to move to an area with like minded individuals with conferences, tradeshows and events. A place where entrepreneurs can meet other like minded individuals and feel like they are at the forefront of an industry to share tips and ideas. Sites like Meetup.com are an excellent platform for like minded individuals to organize meetings.

A business friendly environment with non obtrusive business regulations is of primary importance for businesses considering opening up shop in your city or state. Business owners extremely dislike having to fill out permits and unnecessary paperwork. Minimal taxes and tax breaks for hiring a large workforce or making a significant investment in the community is important to business owners considering one region or another. The less red tape business owners have to go around the more money and time they have to invest in their business.

Many cities and states already attract certain types of industries because of resources already in the area or because of geographical location. It’s important to focus on what differentiates your city or state from other places and not try to cater to every industry. Be aware of opportunities you can offer entrepreneurs that decide to do business in your area and highlight those attributes in all your marketing materials.

Lastly, since economic development teams are tax payer funded, there likely isn’t a huge budget to work with. The good news is the line between paid marketing and free publicity has faded, which rewards the creative and savvy social media users. It’s important to have a person dedicated to interact with all forms of new media and pump out new content regularly on your own website. If you share interesting news, it can potentially be shared by many more people than a traditional ad and this top of mind awareness maybe what lures in a business that is relocating or expanding.

2 thoughts on “How Cities Attract Entrepreneurs and New Business”

  1. Hello Adrian,

    Other than Town Administration having minimal red-tape, what can elected officials and/or administration do to attract business?

    I’m a Journalist in Hinton Alberta, looking to write up a story on this topic. 🙂

    Best,

  2. There is an intention to create a new multi -million pound Business Quarter in the city of Chester UK. There is a Business Park nearby which has been able to attract a number of firms small and medium. There is a university of Chester which has a number of departments able to provide expertise in different subjects and a new science and engineering campus based at the former Shell Thornton Science Research Centre. With a detailed knowledge of the local businesses environment and a desire to play a key role in the development of the Business Quarter, would it be sensible for a local well established law firm to become a centre of publicity and advice for prospective entrepeneurs. The firm has a wide range of knowledge in legal matters and are able to recruit specialised IT personnel to augment this new department. .
    Regards,
    Peter Francis.

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