What Our Research Has Revealed About Rural Microbusiness Support

When we think of rural small businesses, we think of mom and pop shops lining our Main Streets, the one-man landscaping business, or the woman running the salon out of her house. Rural small businesses are also the local maker selling her jewelry online or at local vendor fairs and the freelance web designer working out of the local coffee shop.

These businesses provide goods and services to the local community, provide an income source that keeps people living in their communities, keeps dollars circulating locally, and increases the overall quality of place.

Most rural small businesses are actually a subset of businesses called "microbusinesses". These are enterprises with less than 10 employees. But don't let their small size fool you. They make up 96% of all US businesses. And in many rural regions, microbusinesses are currently the only source of business growth, as the number of larger employer firms has actually declined over the last two decades

Rural Microbusiness Support

Microbusinesses are vital to rural communities, but they are in trouble and need support for many reasons. Over the past few months, we’ve been deep in the weeds researching rural entrepreneurship and small business programs to better understand what is actually available for microbusinesses.

Our goal was simple: figure out what’s working, what isn’t working, and where the gaps are.

As we looked at the research, one thing became clear.

1. Most entrepreneurship programs aren’t designed for microbusinesses

Many initiatives described as entrepreneurship or small business programs are actually designed for a very specific type of entrepreneur: high-growth startups that want to scale quickly.

Those programs can absolutely be valuable, but they serve a very small slice of entrepreneurs - not microbusinesses.

Microbusinesses do not need pitch-decks, venture capital, or the business model canvas.

2. Microbusiness programs are usually temporary

In the communities were microbusiness support programs were in place, it often looked like:

• a micro-loan program

• a short training cohort

• access to a business coach during a grant year

• random small business workshops

Each of these can help, but most are pilot programs tied to short-term funding. When the grant ends, the program often disappears - and so does microbusiness support.

Entrepreneurship, however, doesn’t operate on a grant timeline. People explore business ideas, launch ventures, struggle, pivot, adapt, and grow over many years.

Short-term programs can provide helpful sparks, but they rarely create lasting entrepreneurial support systems.

3. Many programs focus on space or capital, not business fundamentals

Another pattern we saw repeatedly is that many small business initiatives that could help microbusiness owners focus on providing space or capital, but not ongoing business development support.

Communities may invest in:

• shared retail incubators

• commercial kitchens

• coworking spaces

• micro-loan funds

These can all be valuable tools, but many entrepreneurs still struggle with the fundamentals of running a business, such as identifying their ideal customers, pricing their products or services, or building a marketing strategy.

Without ongoing guidance in these areas, early investments in space or capital don’t always translate into long-term business success. Business owners need to know how to run their business once they are in the incubator space or commercial kitchen.

What This Tells Us

Taken together, these patterns reveal something important.

Many rural and small communities genuinely want to support entrepreneurs, but the programs designed to do that often miss the majority of entrepreneurs who actually exist or aren’t available long enough to make a lasting impact.

Meanwhile, the microbusiness owners who make up the backbone of their communities need practical business education geared toward microbusinesses, guidance, and support that exists over time, not just during a grant cycle.

The Bigger Opportunity For Communities

In a recent conversation with Mary Athey, VP of Entrepreneurship at the Southern Minnesota Initiative Foundation, she shared what she’s learned from overseeing the Rural Entrepreneurial Venture (REV) program that perfectly summarizes what we’ve seen as well:

Rural entrepreneurship programs would work best when they are embedded in local or regional economic development strategies - not treated as one-off projects.

In most other areas of economic development - workforce development, business attraction, and downtown revitalization - communities have built permanent support systems and institutions, not just short-term programs.

Workforce development has workforce boards, training institutions, and ongoing funding streams. Business attraction has dedicated economic development organizations, marketing strategies, and incentive structures. Downtown revitalization has long-term programs like Main Street America that provide ongoing coordination, promotion, and business support.

These efforts are not treated as temporary experiments. They are embedded into how communities approach economic development.

Microbusiness support, however, rarely has the same level of permanent infrastructure with a cohesive system behind it. Instead, it is often delivered through short-term projects that appear for a year or two and then disappear when funding runs out.

Questions Worth Asking

Microbusinesses are the backbone of the rural economy and make up 96% of all small businesses. We discussed their economic impact HERE. They need support beyond random workshops and a website full of links and videos with no direction.

Entrepreneurship isn’t like a job that you start and stop in a specific timeframe. People need support when they explore a business idea, launch their business, struggle, pivot, and grow. Those needs don’t happen on a grant timeline.

This raises important questions for communities:

Are we launching one-off entrepreneurship/microbusiness projects or building systems that support entrepreneurs over time?

What would it look like if supporting microbusinesses became a permanent part of our local, regional, or statewide economic development strategy?