West Virginia has the lowest rate of new business startups of any state in the nation. Improving that statistic is the goal of an ambitious program just launched by the Advantage Valley economic development organization.
The new three-year collaborative effort is named FASTER WV. That’s an acronym for Fostering Advantages for Startups for Entrepreneurial Resurgence in West Virginia.
The program is aimed at better preparing would be entrepreneurs with basic skills, one-on-one coaching with professional coaches, short (8-week) entrepreneurship courses and access to capital through a dedicated revolving loan fund.
“We recognize that this may be a tough time to think about starting a new business venture,” Advantage Valley Executive Director Terrell Ellis said. “But we are hopeful that the current health and economic crisis will pass and that those who have dreamed of owning their own business will be ready to pursue their passion when it does. This is a perfect time for people to explore their options.”
FASTER WV is funded by grants of $930,000 from the Appalachian Regional Commission and $362,000 from the Charles Worthington Benedum Foundation, with additional support from the Greater Kanawha Valley Foundation.
The program is designed to assist entrepreneurs and new businesses in Kanawha, Putnam, Boone, Cabell, Clay, Lincoln and Wayne counties — a region that’s been hard hit by the decline in the state’s once-booming coal industry. The program’s goal is to facilitate the startup or expansion of 50 businesses at the end of three years.
Ellis noted that Advantage Valley has lined up a number of partners to work with on its FASTER WV effort. They include:
n BridgeValley Community and Technical College
n Unlimited Future Inc., a nonprofit micro-enterprise development center and business incubator in Huntington
n The West Virginia Small Business and Development Center, a state agency that provides assistance and guidance to individuals wanting to start a new business
n The Wyoming County Economic Development Authority, which is tasked with managing the loans extended to qualified participants in the program
“The first step for anyone wishing to take part in the program is to meet with one of our business coaches,” Ellis said. “If you live in Putnam, Lincoln, Kanawha, Boone or Clay counties, you’re going to meet with the business coach employed by our partner, the West Virginia Small Business Development Center. If you live in Cabell or Wayne counties you’re going to meet with a coach at Unlimited Future in Huntington.”
“When you meet with your business coach, the coach will assess what your situation is, whether you’re ready to launch into taking some courses or, whether you might need a little more exploration into your business concept before taking classes. If you’re ready, your coach will refer you to one of our entrepreneurship courses at BridgeValley or Unlimited Future.”
BridgeValley offers Kauffman FastTrac classes, while Unlimited Future offers Planning for Profit classes. Currently both are eight-week, online Zoom classes.
Program participants taking the Kauffman FastTrac course learn how to evaluate their ideas, position their businesses around target customers, refine their companies based on personal and professional goals and ultimately launch their businesses.
Planning for Profit, the online course offered at Unlimited Future, is based on the work of author and entrepreneur Rhonda Abrams, widely recognized as one of the nation’s foremost experts on small business, entrepreneurship and business planning.
On satisfactory completion of the Kauffman FastTrac or Planning for Profit classes, a participant’s business coach will assist him or her in applying for a FASTER WV loan from a revolving fund dedicated to businesses in the Advantage Valley region. The loan fund is managed by the Wyoming County Economic Development Authority.
“Once you get your coach and take your class, then your coach will help you make an application to the loan fund if you’re interested in getting a loan, Ellis said.”
Six key sectors
FASTER WV is targeting startups in six key sectors that Ellis described as “ripe for entrepreneurial business and job development.”
“A couple of years ago, Advantage Valley did an analysis of what the best opportunities are for opening new businesses in West Virginia. Basically the analysis identified where there is a demand for goods and services, and where that demand is not being met. Using that analysis we’ve come up with six job sectors that we want to target in our FASTER WV program.”
The six sectors are:
1. River and outdoor recreation — This includes any business that serves participants in the outdoor recreation industry or provides support to businesses that serve this sector.
“Good examples would be kayak rentals, fly fishing, paddleboarding or a marina business.” Ellis said. “We also think there’s a need for lodging paired with an outdoor recreation business. There’s a particular need for that in the state’s rural areas.”
2. Dependent care services — This sector includes child care, senior care and canine care.
“Our inclusion of canine care might seem odd,” she said, “but there’s a big demand for businesses serving people with pets. People are spending a lot of money on their pets and we think that’s a growth opportunity.”
3. Construction trades — This refers to trades (such as carpentry, bricklaying, plumbing, etc.) that are essential to and chiefly practiced in connection with building construction.
4. Healthcare — Providers of diagnostic, preventive, remedial and therapeutic services such as doctors, nurses, hospitals and other private, public and voluntary organizations are expected to increase in demand. This sector also includes medical equipment, pharmaceutical manufacturers and health insurance firms.
“If you’re an advanced practice nurse who wants to open a wellness program or you want to open a home healthcare business or you want to manufacture medical equipment, you certainly would qualify,” Ellis said.
5. Small manufacturing — By “small,” the sector refers to the manufacture of goods with annual sales under $1 million.
6. Food and beverage production — This includes all companies involved in processing raw food materials, packaging and distributing them. It also includes freshly-prepared foods as well as packaged foods and beverages (both alcoholic and non-alcoholic).
Marjorie Cooke, Advantage Valley’s director of marketing and communications, noted that the state’s food and beverage sector received a tremendous boost last year when the Legislature overwhelmingly approved legislation easing restrictions on “cottage food” producers who previously could sell at seasonal farmers’ markets and sporadic community events. Now they can sell directly from their homes, take online orders and even sell through retail outlets like grocery stores.
On June 10, when Advantage Valley used the Zoom app to conduct a webinar on cottage food sales. The virtual event attracted 90 people.
“We had people not only from our seven-county FASTER WV region, but surprisingly from 17 other West Virginia counties. Apparently interest in cottage food sales is high now, as the local food movement is seeing a surge amidst the pandemic,” Cooke said.
Ellis noted that only businesses within the targeted sectors will be eligible for a FASTER WV loan. For other business sectors, the coach will assist a participant with securing funding from other sources.
FASTER WV partners
The West Virginia Small Business Development Council (SBDC), a key partner in the FASTER WV initiative, operates 15 centers around the state where it offers assistance to entrepreneurs and small business owners. A unit of the state Commerce Department, it receives a portion of its funding from the U.S. Small Business Administration.
“We consider the work we do critical to West Virginia’s economic growth,” said SBDC Director Debra Martin. “Almost 99 percent of all the businesses in West Virginia are small, and those small businesses employ nearly half the employees in the state. Operating a small business isn’t easy and in fact only half of the new small businesses that start up are still around five years later.
“Data shows that businesses fail for one of three reasons — lack of knowledge, lack of experience or lack of capital,” Martin said. “This is why we believe our mission is so critical. We believe no business owner should have to rely just on themselves to figure things out. We bring skills, training and technical assistance to the table that any business owner can benefit from. So, as a partner in FASTER WV, we have added a new business coach, Robbie Parker, to primarily help new businesses get started.”
“Robbie wears two hats for us,” Ellis said. “As Debra said, he’s the new business coach at SBDC and he’s also an instructor at BridgeValley, where he is doing the Kauffman FastTrac online training for our FASTER WV participants.”
“At BridgeValley,” Parker said, “we offer job training in a long list of areas — in diesel technology, welding technology, culinary skills and so much more — and at the same time we also provide training that shows you how to run the business you want to open. You can be the best chef in the world and have no idea how to run a business. Now with FASTER WV we can put you on the fast track to learning how to operate your business.”
Unlimited Future is a nonprofit micro-enterprise development center and business incubator, said Ursulette Huntley, its executive director. “Our vision is to see a thriving economy, supported by successful, locally owned business. Our mission is to supply our clients with the tools, resources and connections people need to improve their economic status.”
The center offers three levels of training, Huntly said. These include business courses, one-on-one instruction and incubator service. “You can actually run your new business out of incubator space we provide in the rear of our building
“Planning for Profit, an online class which we offer in partnership with FASTER WV, is our most popular course,” Huntley said.
The Planning for Profit class offers a wealth of information for people wanting to start a new business or grow their existing businesses, said Unlimited Future Training Director Jules Bills. “We cover the different legal structures your business can use. We offer tips on how to do market research. We go in depth on things like accounting and legal services; something we stress strongly is the importance of your financial projections. Our ultimate goal is to enable you to write a strong business plan.”
“It’s an eight-week course, typically offered on Tuesday nights. We offer it four times a year. Currently we’re only delivering it by Zoom. While we’re in the COVID-19 pandemic, we’ve waived any fees of the course.”
Ellis noted that Wyoming County is not part of the Advantage Valley region, but “we’ve turned to Christy Laxton, director of the Wyoming County Economic Development Authority, to manage our loan fund. She’s been doing that for 20 years and has a great track record.”
The load fund, Laxton emphasized, will only accept applications referred by the FASTER WV business coaches. “Loans are based on a maximum of up to $25,000 per job created or saved, up to maximum total of $50,000. The interest rate charged is the prime rate plus 4.25 percent. Loans are for two- to 10-year terms.
“Many banks don’t want to fund startups, so we feel that our loan fund will help fill that void,” Ellis said.
The ARC grant that Advantage Valley is using to fund the FASTER WV effort is part of the commission’s POWER (Partnerships for Opportunity and Workforce and Economic Revitalization) Initiative, a congressionally-funded effort that targets federal resources to help regions affected by job losses in coal mining, coal power plant operations and coal-related supply chain industries due to the changing economics of America’s energy production.
For more information on FASTER WV call Advantage Valley at 304-352-1165, or go to advantagevalley.com.