Philanthropy for Active Civic Engagement (PACE)

This is a guest post from Amy McIsaac, who authored the newly released paper Entrepreneurial Reciprocity: The Case for Entrepreneurs’ Engagement in the Community, a collaboration between Philanthropy for Active Civic Engagement (PACE) and the New Economy Initiative (NEI).

Credit: Nick Hagen

In today’s world, entrepreneurs occupy a special place. They are the architects of new ideas and the implementers of new realities. They dream of worlds that do not yet exist, and they forge a path to lead us there.

Entrepreneurship is not an easy road. If you talk to 100 entrepreneurs, I am confident you will hear about the challenges of the start-up phase, the financial and personal sacrifices they make, the long hours they work, the risks they take, and the balance they are still striving for. Entrepreneurs are the sole drivers of turning their idea into reality, and with only one in twelve entrepreneurs reaching success for their business, the odds are steeply stacked against them.

This is where communities come in. Across the country, towns, cities, and regions are thinking intentionally about how they support entrepreneurship. Local leaders are asking themselves questions like: How do we attract or inspire entrepreneurs? How do we support them? How do we connect entrepreneurs to resources and networks to grow their business in our community? But increasingly, local leaders have also started to ask themselves questions like: How do we retain entrepreneurs? How do we develop them as local leaders? How do we connect their business success with our community success? How do we engage them in the community?

Two groups, Philanthropy for Active Civic Engagement (PACE) and New Economy Initiative (NEI), were particularly interested in these emerging questions, though from different angles.

New Economy Initiative — whose mission is to grow a culture of entrepreneurship — also has a vested interest in civic engagement because at their core, both issues are about creating connection to places, people, and ideas, and making investments in them. As a project of the Community Foundation of Southeast Michigan, they have long felt there was a gap in research, data, and thinking regarding entrepreneurs’ relationship to and philosophies about community and civic engagement — both on the individual and ecosystem levels. NEI felt it was important to illustrate their connection to civic engagement, break open a critical conversation in the entrepreneurship field, and encourage more thinking from funder peers about how entrepreneurship and economics relate to — and are strengthened by — civic life.

Philanthropy for Active Civic Engagement strives to find new ways to amplify the importance of philanthropic investment in civic engagement — both as an objective in itself, and because civic engagement is linked to other issues and topics that matter for communities. PACE felt it was important to explore a specific population’s approach to community and civic engagement as a way to initiate a conversation and expand that population’s’ engagement over time. Further, as the historic origin of much philanthropy in America has been entrepreneurship, they knew it would be difficult to have a conversation about increasing philanthropic investment in civic engagement without understanding how a rising generation of entrepreneurs conceptualize this topic and their role in it in today’s context.

Together, PACE and NEI launched a project to understand how the rising generation of entrepreneurs think about community engagement. I had the privilege of working with them to design the project, conduct a landscape analysis, research existing data, interview and survey entrepreneurs, and ultimately, publish a paper with our findings.

Today, we are excited to release the results of our efforts: Entrepreneurial Reciprocity: The Case for Entrepreneurs’ Engagement in the Community.

I could spend time sharing the key findings of the report (e.g. 91% of entrepreneurs are currently engaging their communities outside of their business responsibilities; 44% of entrepreneurs say their businesses have grown as a result of engaging their communities; etc). Or, I could share highlights from the case we make for why community engagement is good for business, entrepreneurs, and communities.

But, what I think might be the most interesting and instructive is an insider’s look into what I found surprising about what we learned after digging into this topic over the last year.

  • Female entrepreneurs seem to prioritize, value, and benefit from community engagement at a higher rate. Our research indicated that 54% of female entrepreneurs report their business has grown as a result of their community engagement, while only 37% of male entrepreneurs made the same claim. And while female entrepreneurs are as engaged as their male counterparts in their communities (92% and 91% respectively), they engage in a different way. Both groups rank volunteering as their primary community engagement activity, but female entrepreneurs seem to value philanthropy and charitable giving at a slightly higher rate (57% females, 51% males). In addition, the motivations behind female entrepreneurs are much more personally driven — 92% said they are motivated by personal values and a sense of identity around giving, compared to 77% of male entrepreneurs. All of this data raises more questions, and the future learning and research agenda at the end of the paper recommends conducting a deeper exploration into why female entrepreneurs feel their businesses grow as a result of their community engagement, especially compared to male entrepreneurs.
  • There seems to be a disconnect between reality and perception. In this first phase of this project, I conducted interviews with entrepreneurs, entrepreneurship funders, ecosystem builders, and academics. In every interview, I asked the same question: “Do you think community engagement is on the radar of entrepreneurs?” Almost everyone I interviewed replied with some version of “no.” So imagine my surprise when I received the results of our entrepreneur survey, and I saw that 91% of entrepreneurs said they were engaging their community outside of their business responsibilities. This result suggests to me that there may be a divide in perception. While entrepreneurs approach the conversation around community engagement through the lens of “here is what I can give,” community leaders are thinking “here is what is needed.” Often a gap emerges, and among both groups, I detected a lack of awareness that a gap exists as well as discomfort about how to address it. Thirty percent of entrepreneurs surveyed said they are not doing more for their community because they are content with what they are already doing, which indicates that there may be an opportunity for communities to be more clear about where they need help and how entrepreneurs could play an important role.
  • The motivations entrepreneurs have in engaging the community carry a lot of weight. While the entrepreneurs we surveyed most commonly selected intrinsic motivations (e.g. expressing their personal values, finding their passion) to explain why they engage the community, extrinsic motivations (e.g. growing their business, building their brand) were not far behind. Many entrepreneurs saw the strategic value in engaging their community, and in some cases, it was seen as almost a business development strategy. What surprised me the most, however, were the strong opinions entrepreneurs and supporters had about what they perceived as the “right motivations” to engage the community. For example, it was not uncommon for someone deeply motivated by personal values to be critical of someone interested in building their brand, and vice versa. No matter where individuals sat on the spectrum, they seemed to be critical of and frustrated by what they perceived to be others’ motivations. I could not help but detect a sense of mistrust in their comments, and I think there would be great value in breaking open a conversation about motivations across respective sectors.

At the end of the day, entrepreneurs — whether small business entrepreneurs, high-growth entrepreneurs, or something in between — have a significant impact on our communities and country. We started this project because very little research or data existed on how entrepreneurs think about community engagement, and we hope this paper changes that reality by providing a resource that becomes the beginning — not the end — of an important conversation in our country today.

We invite you to read the full report, and an Executive Summary, Overview and Brief, and Conversation Guide are also available to help spark conversation about these topics.



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