Jewish World Review Jan. 10, 2003 / 7 Shevat, 5763

Eve Tushnet

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Consumer Reports

The Entrepreneurial Imagination | There is a mythology of the free market, a romance of lone individuals creating value out of nothing and in no context, without even needing the intervention of a muse. This is a peculiarly American romance--we are fiercely individualistic to the point of absurdity. The market is romantic--the act of creation is central to its processes. The market is driven by new developments, new technologies, and new applications of existing capabilities, and discerning these new possibilities requires an active and questing imagination. But too often we forget that imaginations need to be nurtured, and would-be entrepreneurs need to be embedded in a rich web of contacts and mentors.

Imagination is one of the key building blocks for business. Take even the most basic and least "creative"-seeming example: You take a low-paying job because you aspire to work your way into management. In order to have the persistence and hope needed to see that low-paying job as more than just a dead end, you need to be able to imagine a realistic path by which you can work your way up. You need enough curiosity to figure out what's possible, and enough confidence to believe you just might make it.

Starting your own business is an even more obvious example. You need to connect your own skills, background, or ideas to your potential customers. You need to be able to imagine people as customers for products they've never heard of--because the product doesn't exist yet. Entrepreneurship requires a journalistic kind of imagination: Just as journalists seek the unexplored angle on a story, so entrepreneurs seek the unfilled niche in an economy.

These entrepreneurs need not run businesses. The nonprofit world needs its own entrepreneurs, people who can discern an unment need in their local communities and find a creative way to fill it. When Clinel "Sissy" Davis founded "Threads of Love," a Christian group whose members sew and knit layettes for the tiniest premature babies, stillborn and miscarried infants, and those who die shortly after birth, she was applying the entrepreneurial imagination to find a way to comfort families caught in painful circumstances. It turned out that she'd found not so much a niche, as a cavern--the need was so great, and the enthusiasm from sewers and knitters so intense, that Threads of Love blossomed into an umbrella group for over a hundred affiliates in 33 states.

But if people believe that there are no unfilled niches; if they don't believe they have the resources to fill them; if they're not connected to other people who have taken the leap of imagination in the past; if they're ridiculed for even trying to find the entrepreneurial angle... then imagination, and the economy of their community, is stifled. It's a vicious circle: Some immigrant groups foster strong entrepreneurial confidence and imagination, thus they build networks to support entrepreneurship. This causes clusters like the concentration of Cambodians in Southern California's doughnut-shop business. Other groups, lacking the support networks, don't foster the same imaginative, striving, and hopeful approach to business life. Networks make imagination effective, but imagination makes networks attractive. Both the economic and the "attitudinal" resources are necessary for success.

This is why stories like that of the Pizza-Ria! kids are so important--they spark the imagination. Pizza-Ria! was founded by five Virginia high school students who turned a source of frustration--pizza deliverers wouldn't come to their neighborhood because it was perceived as unsafe--into an opportunity. Pizza-Ria!'s slogan is, "It's fresh! It's good! It's from the 'hood." The teens started out by buying pizzas from Pizza Hut and ferrying them to the 'hood. They got a loan from the Norfolk Redevelopment and Housing Authority and started buying the pizzas wholesale from Pizza Hut and retailing them to the neighbors. The business has expanded into a bookstore, cookie factories, and more. The teens made cash delivering pies to a neighborhood that less-imaginative people had written off as a business zero. And they're proving that kids from that same written-off neighborhood can succeed.

How to foster this kind of imagination? There are a few obvious things you can do: Have business owners come to schools, speak with kids, and mentor kids. If you're a teacher: Are there any students who have business leanings or skills? Do they want to start a club? Schools can be places where students are able to find--if they're willing--inspiration, practical advice, and, crucially, networking. Community centers are the other obvious place for this--start a group of business leaders, place ads in the neighborhood papers, and start connecting people with ideas to people with experience.

Then there's money. Elmseed, a product of the Yale Entrepreneurial Society, is working to make microlending successful in the U.S. Microlending, in which very small loans are made to people who don't have enough collateral for a regular loan, is a way of giving would-be entrepreneurs the seed money they need. Elmseed has already helped one man start a hat-and-glove business and helped a woman reinvigorate her sagging African jewelry and accessories shop. The group's slogan is, "Small businesses. Small loans. Big dreams."

Of course, licensing and other regulations make opening a small business prohibitively expensive or difficult for a lot of people. The Institute for Justice has done stellar work opening up markets and easing licensing requirements; they've fought legal battles on behalf of black hairbraiders, cabbies, and independent casket retailers.

Large businesses can avoid the worst effects of regulation--medium-large ones can eat the cost, while supersized ones can finagle the regs so that the rules actually favor them--but small-timers have neither money nor pull. So cutting red tape, making it easier and cheaper to start a business, should be a major priority for city governments. Too many cities today rely on trying to lure big outside investors with tax incentives, rather than making it easier for indigenous entrepreneurs to begin and thrive.

And finally, the entrepreneurial imagination begins young. I never would have expected this, but there's a sweet and inspiring book for children that focuses on the creativity and persistence needed to make a business work. It's Jean Merrill's The Toothpaste Millionaire, the story of two friends who realize that they can make a better and cheaper toothpaste. The book relies on an overly-sharp distinction between Big Business and the Little Guys, but in general it's an excellent book that should be on every elementary-school library shelf. It's fun, light and adventurous--and it'll even teach kids how many are in a gross!

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© 2002, Eve Tushnet