Development of Small Entrepreneurship in Rural Communities of Ukraine
GURT Resource Centre has implemented the project during 2014-2015 in rural communities of Ukraine in which entrepreneurial talents from 65 rural communities received consultancy and financial support to kick-off their start-ups. Project’s success was based on 3 pillars. The 1st pillar is that the program included a community development component and mobilized a wide range of local activists identifying the real local needs that can be addressed by small businesses set up within the project. The 2nd pillar is high quality training program of the International Labor Organization «Start and Improve Your Business» that is a management-training program focused on starting and improving small businesses in developing economies. The 3rd pillar is that the follow-up consultancy activities allowed project’s participants to receive tailored advice for further sustainable development of their businesses as well as to get start-up support to make first steps in boosting their businesses.
1) To increase knowledge and performance of community members in setting up development small enterprises, 2) To support unemployed community members in setting up and developing business.
HOW THE OBJECTIVES WERE ACHIEVED
The following activities have been implemented in order to achieve the objectives:
1) Mapping of business opportunities for target communities;
2) Mobilizing community members ad conducting participatory community gatherings to generate business ideas for small entrepreneurship development in the communities (196 participants in general);
3) Conducting ‘Start and Improve Your Business’ training program for 92 representatives of rural communities;
4) Conducting business-plan contest and providing start-up seed funds for 36 entrepreneurial talents;
5) Creating networking opportunities for start-uppers from different communities.
Implementing the project GURT became a pioneer practicing community development through empowerment of entrepreneurs to become independent and successful community leaders by providing them with knowledge and financial support to develop their businesses. Entrepreneurs, involved into GURT’s project represent different vulnerable groups of society such as women, youth, people affected by the conflict in the eastern Ukraine.
The project implemented by GURT has significantly improved socio-economic development of rural communities that participated in the project through setting up of 36 small businesses within the communities and creating additional employment opportunities for community members. Startups supported by GURT are focused on providing services that are in real demand in rural communities because of their high importance for ensuring basic living standards. At the same ti the project has boosted the leadership potential of community members by empowering them to develop their own businesses. Six month after the start-ups have been kicked-off 89 % of entrepreneurs continue to develop their businesses. The profitability of the businesses is extremely high as well - 58% entrepreneurs have increased the profitability of their enterprises.
Moreover, it should be considered that project has impacted not only those participants who have registered their own businesses, but also for those who created
Because of the slow speed of transformations in Ukraine official registration and small business development processes remain too risky and high costly for start-uppers. Owing to the high bureaucracy, Ukrainians still keep in mind that officially registered business tends to be less efficient than unregistered. Significant efforts within the project were made to clarify official registration procedures, support in legal, financial, tax issues, and other questions related to setting up and development of small businesses and to empower start-uppers with clear and efficient tools for developing their businesses. It enabled GURT to reach successful and sustainable results.
Whether a project succeeds or fails, there is useful and transferable information that can be shared with other rural communities. GURT’s lessons learned from the project are the following:
Community participation and buy-in is a key element for project success. The community should set the direction of the startup. Project communities that manage to arrange participatory community gatherings for generating business ideas has shown better results in developing small businesses.
Incorporation of social values. A contribution to the long-term sustainability of the community is central to ensuring local ownership and support of the initiative, and key to the successful implementation of a startup.
Holistic approach. It took a holistic approach and has mobilized community members to develop demand-driven business ideas, has built partnerships with authorities to ensure better environment for start-uppers, and and empowered communities’ entrepreneurial talents to develop their businesses.