This Aspen Institute report, “Developing Entrepreneurial Economies in Rural Regions: Lessons from Kentucky and Appalachia,” by Rob Gurwitt, summarizes a June 1996 workshop in Kentucky that explored how rural regions can cultivate entrepreneurial economies. The report highlights the challenges faced by states like Kentucky, which have historically relied on low-skill industries and external ownership, leading to a lack of risk capital, sophisticated business services, and an entrepreneurial culture. Lee Todd’s experience with DataBeam in Lexington exemplifies these challenges, particularly in securing funding and finding skilled professionals locally. The document defines an entrepreneurial economy not just by high-growth companies, but by a culture that encourages innovation, risk-taking, and continuous learning, applicable to various sectors, not just high-tech. It debunks fallacies that entrepreneurship is exclusive to high-tech, rapid-growth firms, or urban areas, using examples like Cox Interiors and Laura’s Lean Beef. The report identifies key ingredients for an entrepreneurial economy, divided into “supply” and “demand” sides:
- Supply-side focuses on providing resources for entrepreneurs, such as readily available capital from knowledgeable investors and a sophisticated private-sector business service system (accountants, lawyers, consultants).
- Demand-side focuses on fostering more entrepreneurs through encouraging spinoffs from established businesses and research institutions, remaking the education system to stimulate entrepreneurial skills, and nurturing a culture that values entrepreneurship.
The report offers concrete ideas for stoking both the supply and demand sides in Kentucky, including convening entrepreneurial groups, creating community college technical assistance programs, forming informal financial capital provider groups, commercializing university R&D, and targeting the media to promote entrepreneurial values.Ultimately, the success of fostering entrepreneurship in Kentucky and similar rural regions requires widespread commitment and collaboration across public, private, and community sectors, rather than relying on a single institution or political initiative. The report concludes by emphasizing the importance of dedicated champions to drive this cultural shift.
