The approach was a typical small city economic development strategy. The idea was to try and ‘lure’ businesses to relocate to Red Wing with tax incentives and real estate amenities. Then, these relocated businesses would either hire or bring a large number of employees with them.
This is a very expensive strategy and there are a number of problems with this approach;
- Red Wing is always competing with all of the other communities who are trying to attract a relocating business with the same strategy.
- Not that many businesses actually relocate, and,
- It reduces attention from the businesses that are already in Red Wing contributing to the local economy.
In 1987, Littleton, Colorado also had this same frustration, but it was more critical in that they had just lost a major employer in the community (Martin Marietta) who closed and laid off thousands of employees very abruptly. Littleton had a sudden economic crisis.
Chris Gibbons was the Executive Director of Littleton’s Economic Development agency and Gibbons came up with the concept of ‘Economic Gardening’, in which a community looks internally for economic growth by creating an entrepreneurial-friendly community.
The compelling reason for this ‘grass roots’ approach to economic development is that small businesses create 67% of all new jobs.
That is a remarkable statistic.
This approach is unique because it assumes that the business creators are already in the community.
This is an over-simplified explanation, but it it the driving Genesis of the Red Wing Innovation Incubator – doing things differently and organically.
Interested in learning more about the Littleton, Colorado experience? Download this.