That’s a finding expressed in an Appalachian Regional Commission case study examining entrepreneurial ecosystem development in the region.
But the case study noted that today, entrepreneurship is now part of the language of economic development in Southwest Virginia.
With an overall population of about 647,000, the case study pointed out the region’s economy was built on a mix of agriculture, manufacturing and resource extraction, primarily in the form of coal mining. Nearly all of these sectors have seen a downturn since 1990. Between 1990 and 2012, employment declined nearly 50 percent in manufacturing, 43 percent in mining and 35 percent in agriculture, according to the case study.
“School enrollments dropped, poverty rates jumped, and a host of other social challenges, especially the opioid epidemic, emerged,” the case study noted. “ … In addition, the region lacked other key components found in robust ecosystems. The local business culture tended to be risk-averse, and there were few entrepreneurial role models – or cheerleaders – to champion them.”
But, by the early 2000s, the case study found community leaders began to embrace new strategies that sought to capitalize on the region’s natural and cultural assets.
The Crooked Road Music Heritage Trail, according to the case study, is perhaps the best known of these efforts.
“The Crooked Road has been hugely successful, helping to create more than 100 local full-time jobs and generate more than $6 million in new local spending over the past decade,” the case study said.
These asset-based projects were spearheaded and supported by the Southwest Virginia Cultural Heritage Foundation, which also led a branding and marketing campaign for the region.
Towns like Damascus, Abingdon and Marion, meanwhile, sought to redevelop downtown real estate and do events, fairs and farmer’s markets.
These regional initiatives, according to the case study, caused tourism expenditures to jump 43 percent between 2004 and 2012, as well as a 23 percent jump in tax revenue.
Then came an initiative called “My Southwest Virginia Opportunity,” which was later dubbed “Opportunity SWVA,” where regional partners sought to build a local culture of entrepreneurship. The initiative’s leadership team began their work with the 2013 “Entrepreneur Challenge,” a regional business competition where local companies and entrepreneurs competed for $10,000 in new business investment.
The Crooked Road and Opportunity SWVA, the case study stressed, led to a shift in local government mindset to see entrepreneurs as part of the local economic development strategy.
“For example, in St. Paul, new firms, like the Sugar Hill Brewery and Clinch River Adventures, have started thanks in part to the regional Entrepreneur Challenge efforts,” the case study said. “Their success has helped trigger other investments, such as the Western Front boutique hotel, located in the center of town.”