The following general categories of activities could be undertaken as a part of an economic development program in a particular area. The specific activities to be undertaken would depend on a number of factors including the quality of the providers in the area, the needs of the population, the availability of other resources, and the budget available for this work.

Entrepreneurial Education - This includes a variety of educational programs or classes that are necessary in order to acquaint the potential entrepreneur with the risks and rewards of entrepreneurship. The topics to be covered include:

1. the relationships between supply, demand, price and production;
2. the attributes of the entrepreneur;
3. the attributes of debt and equity capital;
4. sources of business financing;
5. market size and market access;
6. fundamentals of market research;
7. marketing strategy design and implementation;
8. fundamentals of the profit and loss statement and balance sheet;
9. the importance of cash flow;
10. attributes of a management team;
11. responsibilities of the entrepreneur to the community; and
12. preparation of the business plan.

Seed Capital - In starting a business, the first capital to be put into the business is usually provided by the owner and is often called owner’s equity. These funds may represent the owner’s commitment to the business as well as the resources that are available. Seed capital supplements or replaces owner’s equity if none is available. Seed capital can be either debt or equity but often needs to be structured in order to be patient and, in some cases, subordinate to future investments. Seed capital is not a conventional type of financing due to the high risks involved. Usually seed capital does not provide a return commensurate with the risks of the business investment. Any returns generated from seed capital investments should be retained in the community in which the investments are made.

A successful seed capital program should be made available to entrepreneurs who have been screened either through the completion of a program of entrepreneurial assistance or the completion of a business plan. The actual award of the funds should probably be made as a result of a competitive process. Seed capital should often be matched or leveraged with other resources such as owner’s equity or a community contribution. Technical assistance should be made available to the entrepreneur as a condition of the receipt of the seed capital and regular monitoring should be maintained.

Consulting Services - Very few entrepreneurs have all of the expertise necessary to start and grow a successful business. Education and prior industry experience are necessary but probably not sufficient in most cases. The entrepreneur must seek to build a management team to help make the business a success. In the early years, few entrepreneurs can afford to hire experienced management expertise in addition to the regular production employees. Consulting services -- such as legal, accounting, and marketing assistance which is provided on an individual basis - help to supplement but not replace the resources of the firm. The entrepreneur should know enough about the work of the consultants in order to understand its purpose and importance and to make judgments about the direction of the business with the benefit of their work. Generally, the entrepreneur will eventually hire accounting and marketing employees although outside legal help may continue to be employed. As part of a small business development program, qualified consultants should be assigned to a firm for a period of time. Consultants usually gain added experience by continuing to work with clients at a particular stage of development or within a particular industry.

Networking - Entrepreneurs are often engaged in a lonely struggle filled with risks and uncertainty, especially early in the growth of the firm. They can benefit considerably from associations with others who can share their successes and frustrations. There are several types of such networks. Peer networks are methods of providing entrepreneurs with access to others. The most common types are trade associations which are usually membership organizations of firms engaged in the same or similar industries. The interaction of these participants may be hindered if they perceive themselves to be competitors. Another type of peer network is based on the stage of the firm. Even very young firms can help others who are engaged in the same process of growing their business. Networks can provide a resource to companies that can help to sustain themselves under adverse circumstances and the networks can be retained as the firms grow. The second basic type of network relies on the availability of experts. Experts may volunteer to provide seminars or discussions on particular topics for the benefit of a particular group of entrepreneurs. If desired, the entrepreneur may seek to retain the expert for a period of time for a fee. In some cases, the expert may provide additional services for free. The availability of an expert network helps entrepreneurs to expand their knowledge on particular topics as well as serving as a resource in the event of unanticipated problems.

Small Business Incubators - All of the activities described above are facilitated when the entrepreneurs are located within close proximity of each other. Their ability to rely on each other and to share resources and experiences is increased. Similarly, the ability of consultants to recognize the firms’ problems at an early stage is also increased. A small business incubator is a building that houses early stage companies for the sole purpose of helping them to grow by providing consulting services, networking opportunities, and, in some cases, seed capital. The successful small business incubator will "graduate" its tenant business to be housed in other locations in the community. The role of the manager of the small business incubator is critical to its success. The successful manager must be able to accomplish a number of roles including the rental of space and the assessment of the problems of the tenants. The manager will develop networks within and outside of the incubator facility in order to efficiently provide resources to the tenant firms.

Other - Other kinds of economic development programs emphasize the development of real estate, improvements to land for future building (such as roads and sewerage), job training, or loans for buildings, machinery, and equipment.

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