For nine months, Washington and 13 other entrepreneurs took MBA-level classes, regularly met with a peer network of classmates, and were coached by mentors. Some also met with angel investors. By using the program's network of business owners, Washington landed $10,000 in new contracts. And she says she learned to better analyze financial statements and craft a marketing plan. "I found I was totally uneducated about a lot of the guidelines and rules of how to run my business," says Washington.JOB GENERATORS
Programs to help urban entrepreneurs aren't new. But the two-year-old BU effort is notable because it focuses not on startups or specifically on minorities, as other programs do, but on any established inner-city company.
That focus is important for two reasons. First, while many entrepreneurs get going with help from family and friends, they often stumble a few years later because they lack strong networks and access to capital. "For competitive reasons, many inner-city entrepreneurs either fear to reach out to their peers or lack the time to do so," says Andrew Wolk, a research associate at the BU School of Management. Wolk co-founded the program with Andrew Goldberg, now its director of programs and development, and sociology professor Daniel Monti.
Second, small businesses are crucial to the health of the nation's inner cities. While small companies account for about half of all jobs nationwide, they provide 80% of inner-city jobs, according to an October study by the Small Business Administration. Yet the number of jobs in inner cities increased at a compound annual growth rate of just 0.1% between 1995 and 2002, compared with a rate of 1.9% for metro areas in general. The better established inner-city companies, the ICE founders believe, are in a position to grow, hire, and boost those numbers.
So far the results are impressive. According to a BU report, the 28 entrepreneurs trained by ICE created 77 new part- and full-time jobs in the program's first 18 months. They brought in $118,000 in additional revenues from peers and almost $2 million in financing. Says Candida Brush, chair of the entrepreneurship division of Babson College's Arthur M. Blank Center for Entrepreneurship and a member of ICE's advisory board: "It has been very successful. I measure that by the degree to which alumni are still involved, making use of the program's network even though classes are over."
To qualify for the nine-month program, businesses need revenues of $250,000 to $15 million, a payroll, and no tax liabilities. Participants pay a $1,500 fee. "We want them to have some skin in the game so they take it seriously," says Goldberg.
Many of ICE's graduates say the program's network is its key benefit. Kelley Chunn, owner of Kelley Chunn & Associates, a three-person cause marketing company, landed a $5,000 deal with Staples (SPLS
) and a $52,000 deal with Gillette after meeting the companies' executives through ICE. Chunn also hired a woman from the company's Roxbury neighborhood as her office manager. "There is a need for economic revitalization of the inner city, and part of this needs to be driven by hiring people from the community," she says. Through that same network, Jeff James found four potential investors for his $300,000, four-employee Net technology firm, Red Galoshes.
Those results should be encouraging not only to entrepreneurs in Boston but also to those in Kansas City. A newer effort, sponsored by the Urban Entrepreneur Partnership and administered by the Ewing Marion Kauffman Foundation, is being launched there to mentor established minority business owners. That should help them grow their businesses -- and with any luck, their city as well. By Jeremy Quittner