Strategies for Tough Times: Focus on the Micro-Entrepreneur

I recently gave a keynote lecture to the World Urban Congress in Riga, Latvia, on creative strategies for difficult economic times. The Congress provided a fantastic overview of what is taking place in urban development across the world, but what I saw and heard also left me a bit cold.

The reason is that largely, the old model is still at work – huge, expensive institutions are being built as vehicles for regeneration and as catalysts for the ‘creative economy’, but with very little attention being paid to the integration of these institutions into the creative fibre of the city or indeed to the business plans for the years to come. In short: a lot of hardware, and very little software. This isn’t a sustainable approach for the long-term, nor wise in the short-term in light of the global financial slowdown. So my approach, for both good times and bad, is to look in the opposite direction:

Focus on the Micro-Entrepreneur

Famed entrepreneur Mark Cuban said a very interesting thing when asked what his advice would be to President Elect Obama in steering the US out of its financial turmoil:

“Entrepreneurs that start and run small businesses will be the propellant in this economy. PE Obama needs to have the counsel of those who will take the real risk inherent in creating companies and jobs. Those who put their money and lives on the line with their business…Entrepreneurs will lead us out of this mess. Talk to them.”

The same principles apply to cities and their cultural and creative strategies. This isn’t the time to be investing in the urban macro, when the urban micro, specifically, the urban micro-entrepreneurs, are collectively a far more valid and adaptive force for change and revival in this climate. They are the software that’s needed to run the city’s hardware.

A prime example of how this hardware and software can combine to support the micro-entrepreneur is Sao Paulo’s Endossa.

Endossa is a collaborative store which caters to craftspeople, designers, independent musicians, inventors, foodmakers, and a wide cross-section of creatives “who devote their time to tactile ideas and need assistance to ‘publish’ them.” The principles of Endossa are as follows:

• Rent empty shelf boxes to every micro-entrepreneur who wants some space to sell products, without asking for sales commission.
• Any product can be sold in Endossa from bottles of chilies to handmade notebooks and its time on the shelf depends on demand: high sales means high visibility.
• Create a micro-community of young entrepreneurs and curious people who visit Endossa to get fresh inspiration from the creative pieces inside the store.

In addition to its “real world” benefits, an interesting side effect of the store is its ability to cross-over with online culture.

As shown in A Cor do Brasil’s flickr photo above, people have begun to promote not only their work, but their physical positioning in Endossa online, promoting both their work and the store, and enabling a comments thread online that feeds back to the physical store. The integration with Web 2.0 philosophies is intentional, as Endossa explains:

“Endossa works more like blogger or digg than as a search engine. The store allows everyone to “publish” their products and then lets customers “sort and rank” them through sales… There´s an algorithm. We call it the ‘Every Purchase is an endorsement’ mechanism. Basically it compares the size and location of a rented space with its revenue, and decides if the space can be rented again by the same brand next month.”

Cementing Endossa as a model of a software sensibility within the Sao Paulo creative economy is the reality that within their retail system, “new modules are being added all the time, depending upon the necessities identified by the user.”

Endossa is an exceptional example of the Focus on the Micro-Entrepreneur strategy. Stay tuned or get in touch for more.