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To Rebuild American Communities, Help Them Help Themselves

Contributor: Oliver Libby
Posted: December 3, 2017

heartland

When Hillary Clinton arrived in West Virginia during the 2016 presidential campaign, she told families whose fathers had worked the coals mines for generations that their jobs were now obsolete. True though this may be, when she announced that “we’re going to put a lot of coal miners and coal companies out of business, right,” and that “I have put forward specific plans about how we incentivize more jobs, more investment in poor communities, and put people to work,” what people heard was that regulations had destroyed their livelihood, but don’t worry, Washington elites had a plan.

When the cavalry arrives from Washington, it’s often far too prescriptive. “Experts” demand that locals learn a certain skill set (coding, for example), when the ability to do computer programming may not make an applicant any more desirable in the local job market. More importantly, locals rarely welcome a solution imposed from above or suggested from outside.

So how can we help struggling communities to help themselves? We can draw valuable lessons from a surprising place: the field of international development. More than a decade ago, Nicholas Negroponte, the founder of MIT’s renowned Media Lab, condemned the digital divide and charged that too many children across the world lacked access to basic computer technology. Soon thereafter, he founded One Laptop Per Child (OLPC), an enterprise designed to produce durable laptops cheap enough to be purchased in bulk and delivered to every corner of the globe. With a single intervention, OLPC held out the promise of ushering future generations into the information age.

I remember feeling personally moved by Negroponte’s vision—it felt to many of us like something that we could do that would have powerful and widespread results. The international development community poured millions into OLPC’s technology, and the organization delivered the laptops. And yet, the initiative proved far less transformative than many of us hoped. OLPC presumed that we could transfer technology from one cultural context to another and obtain similar results. Nepalese kids would derive the same benefit American kids had from access to a computer. But we were wrong. Development doesn’t work that way.  The hard lesson learned: the self-help effort has to be fashioned and “owned” locally.   

The international development world has come a long way since Negroponte’s speech. Participatory development—the idea that, rather than imposing a solution, we should help local communities make the most of what already works for them—has become the gold standard in development work. And it is precisely this approach that we should now apply to reinvigorating American communities in the industrial heartland. We should empower local communities rather than prescribing solutions, and then be ready to reinforce their successes with investment and visibility.  We have actually done this before, like when the Local Initiatives Support Coalition, the National Community Development Initiative / Living Cities, and others rebuilt the central cities of America in decades past.  This approach makes it far more likely that authentic, proven, locally-sourced solutions will be adopted at scale, joining local know-how with institutional backing from government and larger private sector organizations.

The good news is that the wisdom derived from bottom-up international development has already begun to trickle into domestic efforts. Adam Edelen, founder of the new Appalachian Horizon venture firm says that “the answers to the challenges confronting depressed communities are best offered by the people who live there. The opportunity for those who want to help is to bring know-how and capital to the region as a means of investment.” Meritus Ventures, a fund that exclusively invests in small companies throughout central and southern Appalachia, has embraced exactly that approach. Meritus’ chairman, Ray Moncrief, doesn’t tell founders how to operate their businesses. Instead, he lets them take the reins, merely providing advice and small amounts of capital (between $250,000 and $2.5 million) when they need a bit of help expanding, or when they run into a temporary difficulty.

The same strategy works in post-industrial America as well. Founded more than a decade ago to nurture would-be entrepreneurs in struggling communities in New Jersey, Rising Tide Capital (RTC) provides training, mentorship, and access to funding for promising ventures. RTC has now graduated nearly 2,000 budding entrepreneurs from its Community Business Academy.  These entrepreneurs include Geoffrey Allen, who closed a trucking business in 2011 and turned an odd-job contracting gig into Property Maintenance Guys, employing five more handymen.  Like Meritus, RTC avoids telling entrepreneurs what to do.  The company simply helps go-getters clear hurdles that might otherwise prevent their growth. 

In Rising Tide Capital co-founder Alfa Demmellash’s words: "Entrepreneurial energy exists in every community, but especially in the communities that are hardest hit by economic downturns.  From access to education to nutrition and wellbeing to elder care services, entrepreneurs in these communities know where the pain points are, and generate solutions not just for themselves and their families, but for their neighbors and residents as well, creating an interdependent network of local resilience."  These community venture funds are just the beginning. Just a quick look at the Community Development Venture Capital Alliance reveals growing national level interest in bottom-up domestic development.

If you were to walk into an international development conference today with a top-down proposal akin to One Laptop Per Child, people would greet you with blank stares.  Seasoned veterans would inquire if you’d asked the local residents you intended to help whether your idea would actually benefit their community. They would want to know whether you were imposing your analysis, values, or worldview on someone else’s life.

The American heartland possesses a wealth of entrepreneurial talent—it isn’t just confined to the coasts. Policymakers should have faith in this talent and mobilize it – doubling down on what works.  Entrepreneurs in local communities know what it will take to make sure everyone enjoys a shot at the American Dream. They have something to say. And if we want to be successful, we should listen and invest in that success.

 

Oliver Libby is the Co-Founder and Managing Director of venture firm Hatzimemos / Libby and Co-Founder and Chair of the Board of social enterprise accelerator The Resolution Project.

 

This column originally published on Forbes.