Good afternoon, everyone:

Pam Lewis, the tremendously effective leader of the New Economy Initiative, recently relocated to Pittsburgh with her husband and turned over the reins to a new president, herself a fabulously talented leader with deep experience in small business development – her identity will be announced in early February. Pam recently sent along a lengthy note to members of the Detroit team offering some reflections on the accomplishments of NEI, on lessons learned, and on work still to be done.

Given our instrumental role in NEI’s formation and evolution, I thought I might offer a criminally-abbreviated and -interpreted summary of Pam’s comments.

For those of you who weren’t here in 2007, when NEI was formed, some context. Susan Beresford of the Ford Foundation suggested that we create a fund to help diversify the Southeast Michigan economy. Ford would pledge $25 million, provided that it wasn’t the highest contributor. Kresge and Kellogg accordingly both matched that $25 million. The fund attracted six other funders and rose to $100 million. It was housed at the Community Foundation, initially staffed by Dave Egner, then head of the Hudson Weber Foundation, and led at the Board level by our own Trustee, Steve Hamp (who has been its only chair).

Over the next fifteen years, NEI would pivot to focus exclusively on building the infrastructure of entrepreneurship in Detroit, including technical assistance, early-stage loan and grant capital, technology transfer initiatives, and prizes and competitions. It increasingly provided the kinds of supports to which immigrants, women, and people of color in Detroit had previously not had access. It simply isn’t possible to overstate the pivotal role it played in creating a dynamic, effective, multi-faceted entrepreneurial infrastructure in Detroit.

Key Accomplishment 1: Fortifying Networks

Pam notes that the last six years have emphasized “supporting existing small businesses in underserved communities through a networked group of business support organizations. . . . This small business network touches thousands of small businesses a year with more than half led by persons of color and over a third by women.” This spills over to the lesson going forward of the need to steward that network and continually strengthen a connected and supportive community of business-support leaders who work to understand and address entrepreneurs’ needs.

Key Accomplishment 2: Building Statewide Support

“NEI has increased the awareness of State economic development leaders of the importance of segmenting resources to support microbusinesses [and fortify their willingness to commit] capital and assistance to underserved microbusinesses located in all parts of the State.”

Lesson 1: Listen to Those You Serve

“Measuring activities is crucial, but understanding the effectiveness and relevance of programs is of paramount importance to philanthropic strategies like NEI. The best way to understand relevance is to capture feedback from entrepreneurs. Entrepreneurs will tell you what they need to succeed if you listen.”

Lesson 2: Don’t Create a False Choice Between High Tech Ventures and Small Business

“Both growing high-tech ventures and inner-city neighborhood small businesses . . . are key factors to a strong regional economy.”

Lesson 3: Engage Those Who’ve Benefited

NEI’s movement of over $20 million in grants to support venture funds and innovative competitions generated a number of high net-worth Michigan founders. We need to find ways to help them give back.

Lesson 4: Share stories

It is vital to gather and compile quantitative measurements of individual investments. But it is equally important to “capture and publish high-quality stories of entrepreneurs and their connection to the NEI-funded grantees supporting them.”

Unfinished Piece of Business #1: Expand Public Support of Microbusinesses

Pam argues for more federal, state, and locally funded programs to target microbusinesses. Those programs need to expand access to affordable capital and highly qualified business advisors.

Unfinished Piece of Business #2: Diversify Support Organizations

The leaders of venture and small-business-focused support should look more like the women, people of color, and immigrants leading those businesses.

Unfinished Piece of Business #3: Keep Philanthropy in the Game

There is a critical role for philanthropies like Kresge to continue to both de-risk funds that provide affordable loans to small businesses and invest in venture programs that support more women and people of color starting high tech ventures.

Pam also suggested two additional resources: (i) to learn about NEI’s evolution: www.neinsights.org; (ii) to see stories about outstanding entrepreneurs in Detroit: www.ingoodcodetroit.com. I would add to that a commentary that Wendy J. penned, which appeared in our Thursday newsletter today – be sure to take a look.

Pittsburgh is so very fortunate to have Pam. We wish her well. We will miss her.

Rip

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