Opportunities for ethnic minority entrepreneurs Gerard Boekhoven 11 October 2005.
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Opportunities for ethnic minority entrepreneurs
Gerard Boekhoven
11 October 2005
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Our challenge: improve market share in the urban regionEthnic minoritiesmainly in thelarger cities
Low marketpenetrationin the largercities
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New entrepreneurship in The Netherlands• Ethnic minority entrepreneurs = new entrepreneurship
• A few statistics:
• over 40% of the new entrepreneurs is located in the 4 major cities (Amsterdam/The Hague/Rotterdam/Utrecht)
• 15-20% of the companies in these cities is owned by new entrepreneurs
• new entrepreneurship concentrated by geography and sector
• room for improvement of success rate
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Our approach is based on• The strategic choice to develop an integral vision on urban themes
• Value creation is central theme
• Urban themes like:
- Urban renewal: Emphasis on an integral development of the area/neighbourhood
- Economic development in neighbourhoods and districts:Keeping neighbourhoods economically vital and stimulating economic activity
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Our approach is based on (continued)
- Reorganising industrial neighbourhoodsDeveloping new concepts supported with financing
- Healthcare / Elderly healthcare: Strong increase of demand, in which demand of the ethnic part of the population is increasingFinancing and system of solidarity both under pressure
- Education:Financing will get more and more a private character
• Developing alternative financing instruments in order to find solutions for these urban themes
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Specific needs of these ethnic minority entrepreneurs• Limited starting capital
• Limited collateral
• Flexibility of repayment schedule
• Profile of microstarters is perceived as risky due to lack of track record
• Lack of knowledge and information about financing possibilities
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Set-up of microfinancing funds • Goal is to stimulate (ethnic) entrepreneurship
• Instrument is used as a result of our integral vision of the area to fulfil a specific need of small starting (mostly ethnical) entrepreneurs- area vision shows the financial strength of the neighbourhood- translation to desired entrepreneurship in the area
• Arrange supportive policy together with the government (accommodation / permits to establish business etc.)
• Set up of microfinancing funds together with local government(securing the economic development of neighbourhoods and areas)
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Structure of microfinancing funds • Original principles of microcredit
- trust - pride - independence
• Social security in stead of financial collateral- entrepreneur connects its neighbourhood with its enterprise
• Review based on different principles- financing register / stimulation of variety of business propositions
• Support in order to increase success rate- coaching in order to come to a business plan - training and workshops- mentoring- providing access to network of entrepreneurs
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Conclusions• Vision on economic development in neighbourhoods, support and
mentoring - reduces the probability of failure of new entrepreneurs- reduces usage of social services- creates employment- AND strengthens the economic value of neighbourhoods
• Development of economic value is connected with the development of the socio social value
• It is essential for local governments to develop an integral vision on urban themes like entrepreneurship, healthcare, elderly healthcare and education
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