Every city leader I know wants to be more business-friendly. That’s especially true with their entrepreneurs and small business owners. Maybe that’s because over half of all businesses have fewer than five employees. Or that over 5 million new businesses were formed just last year, up 44% from 2019. Or because small businesses continue to outpace large businesses in hiring employees, accounting for two out of every three new jobs added to the economy over the past 25 years. Or maybe it’s that for every one percent increase in the number of entrepreneurs in a state, there is a two percent decrease in poverty rates. There are a lot of reasons to love entrepreneurs and small businesses, and cities can secure their futures by supporting their success.
And yet, when we survey local governments, there is near consensus: It is not easy for entrepreneurs to start and grow their businesses. Here is the hard truth. Entrepreneurs in your community are struggling through dozens of regulations, paying thousands of dollars in fees, and investing months of their time to do something we all want to accelerate — provide quality services, hire new employees, and pay local taxes. On the one hand, entrepreneurs are told that they are welcome and desired, while on the other, they face delays and complications when working with their local government.
Becoming More Business Friendly with One-Stop Shops:
Q&A with the Experts
We sat down with entrepreneurship experts from the Kauffman Foundation, the Institute for Justice, and the Right to Start about how to combat these challenges.
One relatively easy strategy they agree all cities can take is to launch a quality one-stop shop for your business community. One-stop shops are not a new concept, and yet high-quality examples are very rare.
Here are the experts and what they have to say:
What are one-stop shops for businesses?
Andy Stoll, Kauffman Foundation
“What we’re doing with one-stop shops is thinking about how we would design a city and put entrepreneurs at its center. How we would organize the city’s departments to make sure they were working in collaboration and coordination with each other.”
“The goal is to create that single point of entry, where if you have a business idea, if you want to start a business, or if you’re already in business and you need help, there’s a single place you can go to get that help. It’s a place where resources, services, and people are together, and it’s easy for the entrepreneur to navigate, and easy for them to understand what they need to do, and then how to do it. That way, as an entrepreneur, you don’t have to run around town trying to find all those different things.”
Jennifer McDonald, Institute for Justice
“A one-stop shop is one of the best things a city can do to make it a more friendly environment for small businesses. Ideally, it’s a centralized location where they can find all the information about what is required to start a business, rather than having to navigate through multiple departments and agencies. It’s a place where an entrepreneur can go, and in a single visit, get all the permits, licenses, approvals, or any other kind of permission that they need to legally operate their business.”
“One-stop shops should provide a streamlined process that can help entrepreneurs cut through the red tape and get their businesses off the ground more easily. The idea is that you’re streamlining the process, you’re making it more efficient, you’re cutting down on the amount of time that an entrepreneur has to spend dealing with bureaucracy.”
Victor Hwang, Right to Start
“We think of one-stop shops as three things. One is an office of entrepreneurship, which is to coordinate policy making. That’s internal facing in the government, someone who has the voice of a mayor or governor making sure that all the different policies that touch entrepreneurs are synced up or are working together. The second is what Qwally does well, which is the navigating of red tape like streamlining and smoothing out the licensing and the regulatory process for approvals and the fees and the forms. That can include government contracting too. And then the third is the actual entrepreneurial support which is the technical assistance piece. Some offices just do the technical assistance, but not the others.”
What can cities expect when they invest in a one-stop shop?
Andy Stoll, Kauffman Foundation
“The short answer is more businesses, more successful small businesses, more jobs, more economic development, and more unique community assets.”
“The city can expect to become more efficient. It will become easier to identify inefficiencies and easier to holistically solve them.”
Jennifer McDonald, Institute for Justice
“Cities that embrace the one-stop shop concept can expect to build stronger relationships with their local business communities, as they’ll be better able to address the needs and concerns of entrepreneurs and small business owners. They can expect to see an increase in entrepreneurial activity and new businesses opening up as a result.”
“A one-stop shop can help cities identify areas where regulations may be overly burdensome or outdated. Cities can expect to build a more efficient and effective permitting and licensing process, making it easier for businesses to get started and ultimately contributing to the city’s economic growth.”
Victor Hwang, Right to Start
“They should see a vast increase in the number of new businesses starting, particularly from those that have the least means because those are the ones that we’re getting shut out the most. The people that have the least money and the least time and the least knowledge and the least social networks will be impacted the most. These barriers seem small to people of privilege or wealth, but those barriers are very big to people who don’t have those things.
I’ve met entrepreneurs who said they had to pay a $100 fee and couldn’t do it or had to scrape their savings to pay. That’s where you see some issues with food deserts, retail deserts, lack of economic mobility. Those types of barriers stand in the way of people with the least means because small barriers are big barriers to them.”
What would you say to a City official on the fence about investing in a one-stop shop?
Andy Stoll, Kauffman Foundation
“I think what we’re seeing, especially during and after the COVID pandemic, is that entrepreneurship is a central element of economic development for cities everywhere. The cities that will thrive in the 21st century are going to be those that create better environments where all people can turn their ideas into businesses. And a one-stop shop is, while not a silver bullet to how we do that, a way to bring together the folks within the city to begin deeper and longer conversations of what entrepreneurship means to our community. It’s a great way to really begin that conversation with all of the folks within the City that touch those issues and those opportunities.”
Jennifer McDonald, Institute for Justice
“If you’re unsure about the benefits of a one-stop shop, consider talking to your constituents and the small business community to learn about their experiences and pain points. This can help you identify areas where a one-stop shop can have the most impact. The power is in the people. Listen to the needs and concerns of the entrepreneurs in your city, and let their voices guide your decision-making process when considering whether to invest in a one-stop shop.”
“One-stop shops can be a game-changer for your local business community, helping them navigate the regulatory landscape more efficiently and saving them valuable time and resources. This can ultimately contribute to a positive reputation for your city.”
Victor Hwang, Right to Start
“I would talk to them about the raw numbers. Entrepreneurs and new businesses create almost all net job growth in the economy. They raise more new businesses and create higher incomes. Every 1% increase in new business entrepreneurial activity in a city or in a county increases household wealth by over $400 on average. 1% increase in entrepreneurial activity in a state correlates to 2% decrease in poverty for the state.”
“I think what’s appealing about this for leaders is that it’s unleashing the power that’s already there in a community. You’re not creating entirely new subsidies or entitlements. You’re just clearing out your own obstacles. You don’t have to reform the entire system. You don’t have to add new programs. You just have to take what’s already there and make it work.”
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About Qwally
Qwally is the industry’s leading provider of business one-stop shops for local governments. We’re on a mission to expand economic opportunity by unleashing the power in our communities and accelerating entrepreneurs and small businesses. Please visit our website at www.qwal.ly and contact Brandon Gumm at brandon@qwal.ly for more information.
About the Author
Brandon Gumm is the Vice President of Revenue for Qwally.