The Small Business Administration has stepped up efforts to reach American Indians, Alaska Natives, and Native Hawaiians through an increase in loans, improved access to procurement programs, and entrepreneur training workshops conducted in person and online.
One big reason: Native American unemployment, which for the first half of 2013 was 11.3 percent, according to the Bureau of Labor Statistics. (The national figure during the same period was 7.6 percent.) Many of these communities have long faced economic challenges and Census figures show poverty levels that now top all ethnic groups. As the native population’s double-digit jobless rate has persisted for nearly five years, private and public institutions are increasingly looking for home-grown solutions.
Christopher L. James, assistant administrator for the SBA’s Office of Native American Affairs, says that’s something that makes Native American entrepreneurs stand out.
“There’s generally different reasons for entrepreneurship among Native Americans,” he says. “Some believe it’s that ‘entrepreneurial spirit,’ but more often it’s job creation or supporting a family.”
The U.S. has more than 550 federally recognized tribes. Census figures show there were 5.2 million American Indians and Alaska Natives in 2012; among those, there are nearly 240,000 who own small businesses. The SBA has been reaching out to native-owned companies in all stages of development, in an effort to aid access to capital and offer training for entrepreneurs. To that end, the agency this summer agreed to expand cooperation with the Native American Contractors Association, an advocacy group that works with tribal corporations and promotes native-owned firms in the federal marketplace. In 2013, Native American firms were awarded $10.7 billion in government contracts, a number that is high historically, James says.
There’s also a focus on strengthening from the ground level. Two programs should be of interest for new and growing companies.
The first is the Native American Entrepreneurial Empowerment Workshops. These are two-day sessions geared toward aspiring entrepreneurs, with practical development training and technical guidance on how to get a small business going.
“We are seeing a real interest in entrepreneurial development among Native Americans. An increase in private sector business could have a positive impact on the economy of Native communities,” says Veronica Nix, executive director of Onaben, a Portland, Oregon-based nonprofit created by Northwest Indian tribes to increase the success of Native American businesses. It is also a provider of the SBA workshops and the originator of its “Indianpreneurship” curriculum. “Our goal is to act as a support to our local, hosting organization and to assist Native Americans leave a positive imprint in the business community,” she says.
For more experienced entrepreneurs, there’s the Emerging Leaders initiative, which focuses on executives at businesses that are on the cusp of growth in disadvantaged communities. This seven-month course, which James says is designed for more established businesses, aims to assist C-suite leaders of native-owned companies that are at least three years old and have a minimum of $300,000 in annual revenue. Its focus: supporting small businesses with a high potential for expansion and growth in underserved areas, both urban and more rural Native American communities. The program, which is free for those selected, was launched in 2008 and was previously known as e200. It has expanded in the last two years and now offers CEO mentoring, coaching on longer-term strategy planning, an immersion in capital access resources with local business leaders, and professional networking. (The application process begins in February and is operated through the SBA’s 68 district offices.)
The bigger costs are the time commitment necessary for busy entrepreneurs. The classes usually begin in April and involve about 100 hours of classroom time with 20 to 25 students in each location. Schedules for 2014 are still being determined, but 2013’s seminars were conducted in major cities near areas with high concentrations of Native Americans, including Oklahoma City, Portland, Albuquerque, N.M., Honolulu, and Helena, Mt., among the 10 sites.
The results have been strong so far. A survey of more than 1,000 participants showed 75 percent maintained or created new jobs in their communities, and nearly half reported securing contracts with local, state, and federal government entities, valued at a total of more than $330 million, according to the SBA.
It’s momentum that those involved in the programs want to keep going.
“We see so many business ideas that range from small, home-based businesses to retail to art to construction—the business ideas run the gamut,” says Onaben’s Hix, talking about the SBA workshops she’s been coordinating for two years. “The feedback that we get from our participants is very positive. The need for business development services is evident.”