Evaluation of the Appalachian Regional Commissions Entrepreneurship Initiative

1. Evaluation of the Appalachian Regional Commission's Entrepreneurship Initiative Deborah M. Markley, PhD RUPRI Center for Rural Entrepreneurship Prepared for Entrepreneurship: Where Practice and Theory Meet November 6, 2008 St. Louis Missouri

2. ARC�s Entrepreneurship Initiative Operated from 1997-2005 with emphasis on homegrown business development Invested $43 million in 340 unique projects throughout the 13 state ARC region Jesse White, Federal Co-Chair � �Re-instill in rural America the idea that job creation, business creation, and, most importantly wealth creation, occur as a result of local indigenous business creation.�

3. Rationale for ARC�s Entrepreneurship Initiative First explicit Federal program supporting entrepreneurship development Belief that strategic investments would help create: More entrepreneurs in the pipeline Better informed and skilled entrepreneurs Stronger, more job-creating businesses

4. Design of ARC�sEntrepreneurship Initiative ARC made strategic investments in: Youth entrepreneurship education Technical assistance and training Business incubators Capital access programs Sector and network support Designed to provide balance to economic development efforts, change the culture in the region, and anchor businesses and residents in Appalachia

5. The Evaluation Approach The charge Examine project outcomes (for sample of projects) and broader policy impacts Identify lessons learned for policy and practice The approach Analysis of ARC-defined metrics for all projects Analysis of broader set of metrics for sample projects (88) Key stakeholder and case study interviews to identify broader policy impacts and lessons learned

6. The Evaluation Team RUPRI Center for Rural Entrepreneurship EntreWorks Consulting RUPRI/University of Missouri RTI International Outside advisory panel ARC partners

7. Evaluation Challenges Ex Post � Some projects as old as 10 years and memories fade Self reporting � Job and business creation verified through ARC validation visits Assessing qualitative outcomes � Reliance on recurrent themes from key informants Diverse portfolio of investments � Created difficulty in applying rigorous statistical methods such as comparison communities

8. Quantitative Evaluation Results � ARC Portfolio

9. Quantitative Evaluation Results � ARC Sample Projects 11,500 students and teachers participated in or received entrepreneurship education 1,500 entrepreneurs took part in sector-focused activities At least 475 entrepreneurs received support through business incubators

10. Qualitative Evaluation Results Investments helped to build a local �enterprise culture�. Investments helped facilitate networking and collaboration among practitioners. ARC dollars represented �but for� money for innovative projects that would not have been implemented otherwise. Entrepreneurship education investments contributed to changing attitudes of young people and their teachers.

11. Lessons for Practitioners � How to implement successful entrepreneurship development initiatives Successful initiatives had strong local champions. Strong local capacity (existing or built) contributed to success. Entrepreneurship recognized as a long-term process. Successful projects were flexible and entrepreneurial in terms of their goals. Partnerships and collaborations were important to success. Celebrating success was reinforcing.

12. Lessons for Policy Makers � How to Invest in Entrepreneurship Development Capacity building should be an explicit part of program design. Investments should be made with a focus on the long term. Initiatives should be required to be market driven and practice continuous improvement. Investments should provide incentives for collaboration and partnerships.

13. Lessons for Evaluation � Measuring Impacts of Entrepreneurship Investments Move beyond counting jobs Single metric cannot capture the wide range of impacts associated with entrepreneurship Consider portfolio of investments rather than a single project Build evaluation into program funding Define a broader range of metrics that capture impacts for local projects Require active participation of grantees in measuring success by training and supporting evaluation activities

14. Lessons for ARC � The Way Forward with Entrepreneurship Become an advocate for entrepreneurship development as an asset-based strategy in the region � Making the case to local elected officials, economic developers, etc. Fund an Entrepreneurial Innovation Fund to build on initial investments � Support second generation investments that have potential for transformative impact and challenge fund for new ideas and concepts

15. Concluding Thoughts ARC�s Entrepreneurship Initiative was ahead of its time. Investments were catalytic, particularly in places with strong capacity to build upon. Non-profit sector practitioners who were already invested in this work were elevated and encouraged. Projects in the region continue to contribute to economic development through the support and encouragement of entrepreneurship.

16. Evolution of the Field ARC�s Entrepreneurship Initiative � Broke ground for the field Key participants in ARC-funded projects � Led in creation of new models and approaches to entrepreneurship development Evolution in practice � Evidenced by weaving together the components of a system The learning/evolution continuum � Fostered by Kellogg Foundation�s EDS projects and key innovators across the country

17. For More Information Deborah Markley RUPRI Center for Rural Entrepreneurship 199 Valley Meadow Drive Chapel Hill, NC 27516 919-932-7762 dmarkley@nc.rr.com www.energizingentrepreneurs.org