On Friday, April 20th the ECJC convened the first-ever meeting of the Innovation Caucus to discuss the current state of entrepreneurship in Kansas. The Innovation Caucus is a group of pro-entrepreneurial, forward-thinking legislators with an interest in supporting entrepreneurship in Kansas. The attendees of the inaugural meeting of the Innovation Caucus were (from left to right): Rep. Jason Probst (D- Hutchinson), Sen. Barbara Bollier (R- Mission Hills), Rep. Dave Baker (R-Council Grove), Rep. J.R. Claeys (R-Salina), Rep. Jerry Stogsdill (D-Prairie Village), Rep. Pam Curtis (D- Kansas City), and Rep. Shannon Francis (R-Liberal, not pictured). The Innovation Caucus will serve as a forum for pro-entrepreneurial legislators to discuss barriers to entrepreneurship in Kansas and possible policy solutions to these barriers.
The ECJC founded the Innovation Caucus as a part of the Ewing Marion Kauffman Foundation’s Entrepreneur’s Policy Network. As one of six organizations selected to form this network, the ECJC is working to identify barriers to entrepreneurship in Kansas and propose policy solutions. This public policy effort was developed in response to the Kauffman Foundation’s Zero Barriers Initiative to identify and remove policy barriers to entrepreneurship. The ECJC’s focus on policies impacting Kansas entrepreneurship aims to support and retain entrepreneurs in Kansas and ultimately make Kansas a leading state in entrepreneurship.
At the first Innovation Caucus meeting, the current state of entrepreneurship in Kansas was discussed at length. Nationwide, it has been well-described that new businesses drive job creation. This is true in Kansas as it is across the rest of the country. Kansas is particularly reliant on small businesses, as 52% of Kansans are employed by small businesses. This reliance of Kansans on small or new businesses is high in central and western Kansas with most counties registering more than 62% employment by small businesses. As new businesses and small businesses drive and maintain employment in Kansas, the importance of supporting entrepreneurship cannot be overstated. However, firm formation and startup density has been on a precipitous decline in Kansas and across the nation for decades. Of the small businesses that do form, their share of scale-ups (ability to grow and employ 50+ people by their 10th year of operation) has dropped from 2% to 1.6% since 1987, indicating that the businesses which do form have an increasingly difficult time growing and creating jobs. Without intervention, the declining state of entrepreneurship could continue and have long-lasting, negative reverberations on the economy.
Despite the relatively grim prognosis of entrepreneurship in Kansas, there are several factors in Kansas which suggest that bolstering the entrepreneurial ecosystem is possible with legislative support. Kansas is home to connected, highly motivated entrepreneurial support networks spanning across the state. The economic development community across Kansas is active and engaged. Communities across rural and urban areas alike are focusing on entrepreneurship initiatives and support structures such as incubators and training programs. Capital networks (such as the MidAmerica Angels investor network) are connected and active in injecting capital throughout the state. The economic development community is vibrant, effective, and hungry for additional support from the state and our legislation. The formation of the Innovation Caucus is just one of the initial steps that ECJC is taking to advocate for pro-entrepreneurial policies in the Kansas state legislature. If you’re interested in staying informed on the ECJC’s public policy initiative, sign up for our policy mailing list here.