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Entrepreneurs: The solution to rural economic revitalization?

Small towns as start-up communities

    Edna Wickman of Ryan (right) checks out Mary Henderson of Coggon in the Faith Mission Thrift Store at Coggon Center on Thursday, Feb. 9, 2017. All items sold in the thrift store have been donated, and proceeds are divided among area organizations. (Liz Martin/The Gazette)
    Regionalism / Workforce
    Apr 17, 2017 at 5:45 am

    Main Street in Coggon is disappearing.

    Its once-vibrant downtown area is struggling to retain its residents as well as its mom-and-pop shops that lined the main thoroughfare of this northern Linn County city, population 650.

    “My opinion is, looking at small towns as start-up communities is what we need to do to save them and the resources they represented."

    - Michael LeClere

    Architect and Coggon, Iowa, native

     

    It is not alone. More than 60 percent of cities in Iowa have lost population since 2010, according to a 2014 study by the Iowa State University Department of Economics.

    Michael LeClere, 32, an architect and landscape architect in residence with Martin Gardner Architecture in Marion, grew up in Coggon, about 30 miles northeast of Cedar Rapids.

    Only a handful of businesses now occupy Main Street, he said — a gas station, a bank, a restaurant, the library and City Hall.

    In 2010, LeClere, while a student at the University of Oregon, wrote a thesis about communities with populations of fewer than 1,000, and he used his hometown as a case study.

    LeClere found that losing downtown buildings can be detrimental to a community’s economy and also has severe environmental impacts.

    The environmental impact of demolishing every downtown building, for example, is two to three times worse that the BP oil spill in 2010 that dumped billions of barrels of oil into the Gulf of Mexico, he contended.

    The solution to fill these empty buildings and shrinking cities and towns? LeClere said it could be to bring in entrepreneurs.

    “My opinion is, looking at small towns as start-up communities is what we need to do to save them and the resources they represented,” he said.

    With the population slide continuing in many of Iowa’s rural communities, LeClere warned more elected officials as well as economic-development and business leaders need to rethink how they can encourage and nourish revitalization.

     

    Percent of small buisness by county

    Here is the Iowa small business percent of employment by county, according to the U.S. Small Business Administration Office of Advocacy. Map by John McGlothlen / The Gazette

     

    Coggon isn’t alone among Iowa communities

    Across the state, some organizations have taken on a model designed to help start-ups in the hopes these entrepreneurs will remain successful long term and, in turn, help boost the local economy.

    From a 2009 economic study, West Des Moines officials, for example, determined the city was spending too much with large, out-of-state companies and not doing enough to support local endeavors, recalled Jo Eckert, assistant executive director with the Business Incubator and administrative assistant with the city’s Department of Community and Economic Development.

    “The city wanted more local business,” Eckert said.

    “It does so much for large companies, but we don’t do enough for small businesses.”

    So the West Des Moines Business Incubator was launched in 2010 by the city as a program to aid development of business-to-business companies.

    In Sioux City, Diane Daby founded Springboard Coworking three years ago after she noticed several empty buildings downtown. Her aim is to encourage local businesses to move into the area.

    “I wanted to open (Springboard) to provide a place for start-ups, and just grow the downtown market and build businesses to fill empty buildings,” Daby said.

    Back in Coggon, LeClere in 2010 presented his findings — and a possible solution — to a gathering of Coggon residents.

    In response, a group of community members that same year formed the Coggon Area Betterment Association, an organization aimed at revitalization efforts.

    It became a not-for-profit in 2014.

     

    At the time LeClere was conducting his research, he also was working to restore Coggon’s former school building on Third Street North, which had been vacant since it consolidated with a nearby school district.

    That building is now home to Coggon’s co-working space, where small business owners can pay a small fee to set up shop. Current tenants are a bakery, a massage therapist and a community recreation center.

    “It’s all with the intent to fill the school and support entrepreneurs, so those efforts spill into Main Street, and we fill Main Street again,” LeClere said. “We’re not full. It’s definitely a work in progress, and there’s still a lot of to be done, but we’re not empty, either.”

    Some experts have noted a rural-urban divide in support of start-ups.

    “We do better in the dense urban markets with a university core than in rural Iowa,” said Daniel Winegarden, director of the Business Incubator at the North Iowa Area Community College Pappajohn Entrepreneurial Center in Mason City.

    But that “divide” doesn’t exist in all small towns. Lisa Shimkat, state director at the Iowa Small Business Development Center, said her office has been hearing from more rural communities seeking to support local businesses.

    “We also have those small communities that are also encouraging more of the shop local movement, such as Small business Saturday,” Shimkat said.

    “For me, that’s what makes it exciting for small businesses.”

    Comments: (319) 368-8536; michaela.ramm@thegazette.com

    Read more: Accelerators, incubators, co-working spaces hope to boost Iowa business

    This story appears in the second edition of the Iowa Ideas magazine. Order a free copy here.

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