Prioritizing entrepreneurship in the new year
With elections behind us and the legislative season starting, policymakers have many opportunities to make their mark. Already we have seen a notable number of issues highlighted in pre-filing. One area that I encourage policymakers to consider is lowering the barriers to entrepreneurship in Arkansas.
Entrepreneurship – or starting and growing new businesses – is crucial to economic growth because new and young businesses create virtually all net job growth in America. Entrepreneurship also benefits everyone, because research in the United States shows that for every 1% increase in the entrepreneurship rate, the poverty rate decreases by 2%.
Making it easier to start and grow a business in Arkansas is the challenge that I accepted when I became the manager of a new statewide coalition – the Arkansas Starters Coalition – created by Right to Start, the national nonprofit organization championing entrepreneurship as a civic priority. The Coalition was launched in August of 2024 with 12 inaugural member organizations from all over Arkansas. In 2025, it will be advancing entrepreneurship by convening entrepreneurs, identifying barriers to starting new businesses, proposing policies to remove those barriers, and engaging communities statewide.
That process all starts with listening to entrepreneurs and those who support them. Entrepreneurs are the ones who are starting and growing new businesses, and they know the barriers that are in the way – from frustrations with government processes to broader concerns like access to capital and the unaffordability or unavailability of childcare.
In the many conversations that I have had with Arkansas-based entrepreneurs and their supporters, numerous key barriers have been cited. What I hear most is that state and local regulations are too often vague or cumbersome; a one-stop-shop for entrepreneurs would be very welcome. Similarly, government contracts and other funding always seem to go to big companies, making it hard for small businesses to gain access to a significant player in the Arkansas economy. In addition, fees and taxes can be crippling to a new business.
In that context, the city of Bentonville should be applauded for eliminating in December – by a unanimous vote of the City Council – both the city’s mandatory business registration fee and the associated renewal fee. One of the complaints that Right to Start has heard consistently from entrepreneurs in Arkansas is that it makes no sense for governments to require new businesses to pay a registration fee before they even have revenue.
It’s in the government’s interest for new businesses to start and grow, allowing them to become taxpaying entities and expand further. Putting obstacles, like registration and renewal fees, in their path is counter-productive.
Bentonville has now taken the lead in removing that obstacle. Other government jurisdictions across Arkansas should follow suit.
State and local officials can learn more about barriers to entrepreneurship by reviewing Right to Start’s “Field Guides for Policymakers.” They highlight key barriers and steps to eliminate them.
The beauty of entrepreneurship is that it can create economic opportunity in every community in the state, because every community has legacy, culture, and talent on which to build. That’s the goal: to create an environment in which every community in Arkansas prizes entrepreneurship and encourages new businesses to start and grow.
Policymakers can play a pivotal role in that regard by doing three things:
First, talk with entrepreneurs and their supporters about the challenges they face. Understanding those challenges, which vary from community to community, is the first step toward addressing them.
Second, prioritize removing barriers in the way of entrepreneurship. Everyone will benefit.
Third, celebrate new businesses in your communities and the entrepreneurs who created them. That’s crucial to demonstrating that entrepreneurship is prized.
The potential for entrepreneurship in Arkansas is extraordinary, and the Arkansas Starters Coalition is committed to maximizing it. Policymakers can play a pivotal role in making that happen.
Editor’s note: Alison Williams is founder of willco consulting and serves as the manager of the Arkansas Starters Coalition for Right to Start, the national nonprofit organization championing entrepreneurship. The opinions expressed are those of the author.