Denise Peek got her first glimpse into the small business owners’ psyche years ago when she was selling ads for a major telephone company.
“I would sell [the customer] any type of ad package but it would take me three to six months, because I would develop a relationship with them,” she says. “I wanted to know who their customers were, how the economy would affect them if interest rates went up. That’s when I really fell in love with small businesses.”
For the last eight years, Peek has lent her listening ear to small businesses through the
Entrepreneur Institute of Mid-Michigan, formerly known as the Lansing Community Micro-Enterprise Fund (LCMF).
The Institute works with low-to-medium income people who want to start a small business by educating them about business and giving them small startup loans.
It also helps existing business owners write business and marketing plans, gives them access to industry experts and provides other resources to take a business to the next level.
Since teaching her first 15-week class in 2000, Peek has helped judges, attorneys, health care professionals, former manufacturers and others get ideas out of their head and into ink—preferably black ink.
She recently chatted with Capital Gains' managing editor, Ivy Hughes, about local entrepreneurship.
What do you view as the Capital region’s most promising emerging industry? I’d have to say and agree with a lot of other individuals—health care is huge. For this region I’d have to say that health care is really, really big. With the two major hospitals here and the program at
LCC there’s all this need for health care.
I would say the other emerging market would be biofuel. I think the next wave of entrepreneurs will come out in those areas because it is developing.
A lot of farmers are good at producing things, they just need to find different avenues so they can produce to different markets. Just because you grow corn—well, what can corn be used for? What can the stalks be used for? The green movement is huge.
What does the region need to do to turn around the economy?We’re doing it to an extent. I’ve said over the last five years that we’ve got to find a way to strengthen our existing businesses and enterprises. Existing business owners and entrepreneurs need to get educated and update their insurance and their software. We need to give them the resources or options to do that.
If you strengthen and make those businesses stronger, they can hire people and watch their sales increase. I think the economy and the business owners here are very strong.
Have you seen your client demographic shift over the past five years?The majority of my clients are African-American women. When I first started it was like 72 percent women and now that’s dropped. My minority population is 70 percent and that’s really changed. When I first started here in 2000, my minority population was like 74 percent and my women enrollment was 60. It’s dropped, so that means more men are now enrolling.
When I started, I think the average age was 25 to 35. Now I would have to say it’s maybe 35 to 55. I have a lot more older entrepreneurs. These can be individuals who are getting ready to retire and they know Social Security may not be around, so they’re looking for something to supplement their income.
Are there any particular barriers preventing women and minorities from moving into the marketplace?I think some of the barriers may be knowledge-based. They may not feel as though they have the knowledge to start a small business, especially the ones who are part of the underground economy. They actually do business under the table and pay employees under the table, and they don’t realize how this actually hurts the economy.
Sometimes it could be a native language or cultural barrier that may come into play. So if we could find a way to knock down some of those barriers—to let them know that those barriers are not so high that they can’t overcome them—then I think more of them would actually come out.
We in the micro-enterprise industry know that there’s an informal economy out there, and nine times out of 10, it’s in the welfare system. And they’re afraid to bring their business above ground because they may be afraid of the consequences they’ll face.
The informal economy makes up for $1 million to $1 billion a year, affecting the entire state.
Just think of what that would do to our tax base—what it would do to their lives to make it better—if we could find a way to get them from underground to above ground.
How have you reached out to smaller communities? What kind of impact does that have on a region?
Most of these businesses are what you would consider Mom and Pops. We consider those micro-enterprises. They employ less than five people and they probably needed less than $35,000 when they started. Those are the types of businesses I believe we can truly service and help grow.
If you look at downtown Lansing, the majority of the restaurants are very small and have maybe ten employees. Of those ten, maybe three or four are full time. Most of them can’t afford $1,200 in rent every month, but they need space.
When I first started here,
Old Town was up and coming and I knew [business owners] could find a reasonable rent if they needed commercial space in Old Town, so I would send a lot of my clients over there.
Now that it has grown to where it’s at, most of my entrepreneurs can’t afford that rent.
So I’ve had to find another location where the rent and the space is small enough that it fit in their budget. And that’s
REO Town.
My goal is to help an area develop. If I can do that by showing the entrepreneur that comes through the program that there's stuff available down there for them, that’s great. We already know Old Town’s a great area to be in. REO Town’s trying to do some of the same things that Old Town has done."
If I can help build up REO Town, I guess my next one would be Michigan Avenue and then maybe along west Saginaw.
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Denise Peek is Executive Director of the Entrepreneur Institute of Mid-Michigan, formerly known as the Lansing Community Micro-Enterprise Fund (LCMF).
Ivy Hughes is the managing editor of Capital Gains.
Dave Trumpie is the managing photographer for Capital Gains. He is a freelance photographer and owner of Trumpie Photography.
Photos:
Denise Peek and the Entrepreneur Institute of Mid-Michigan
All Photographs © Dave Trumpie