The ERC WORKANDHOME project organised together with the OECD Centre for Entrepreneurship, SMEs and Local Development (LEED) a policy seminar on home-based businesses. The seminar was hosted by the OECD in Paris on the 4th October 2017 as part of the OECD Inclusive Entrepreneurship series.
The seminar was designed as a platform where the challenges faced by home-based entrepreneurs could be discussed and where the knowledge on public policy initiatives that support home-based businesses could be exchanged. It focused on further actions that policy makers could take and how these actions could be implemented. The multi-perspective stimulating seminar discussions were meant to be used to strengthen a policy brief on supporting home-based businesses that the ERC WORKANDHOME project and LEED are preparing.
The seminar participants were representatives from national governments and local councils, the DG Employment, Social Affairs and Inclusion of the European Commission, business support agencies as well as home-based entrepreneurs themselves. Participants came from a number of countries: Australia, the USA, Italy, Austria, the Netherlands, Belgium, Poland, Slovakia and the United Kingdom, and covered different policy areas including employment and youth, town planning and small business.
The presentations covered a wide range of successful policy interventions implemented in order to stimulate the development and growth of micro-entrepreneurship. These included co-working and crowdfunding initiatives as well as training, mentoring, micro-funding schemes and urban planning and architecture. Essentially, some of the programmes and initiatives address micro enterprises (whether they are home-based or not home-based). However, in practice, many of the supported micro enterprises are in fact home-based.
International speakers were invited to present good practice of how to support home-based businesses:
- Carmel O’Regan, Australian Government, Director of Department of Employment
- Lucia Scopelliti, Municipality of Milan, Head of Economic Planning Unit
- Roman Riedl, Austrian Federal Chambers of Commerce, One-Person Enterprises Affairs, Vienna
- Mandy Payne, Christchurch and East Dorset Council, Economic Development Officer, England
- Jake Wiersma, Municipality of Maastricht, Senior Urban Planner
- Chris Webb, U. S. Small Business Administration, Deputy Chief of Microbusiness, Washington, D.C.
- Tom Craig, Scottish Government, Entrepreneurship Team, Edinburgh
Please find the presentations slides here:
Darja Reuschke, Markieta Domecka: Understanding home-based businesses and the barriers that they face
Lucia Scopelliti: Locally fostering home-based entrepreneurship and growth
Jake Wiersma: Home based business in the Netherlands
The home-based business entrepreneur
Two London-based home-based business entrepreneurs (freelance business and social media company) reported about their personal challenges of setting-up and running a business from home. Most significantly, it was difficult for them to ‘get started’, to get necessary information how to start a business and where. There was missing an international platform where advantages and disadvantages of certain locations were presented to would-be entrepreneurs. London was a good place to start their businesses because of the low costs of registering a company in the UK and the many meeting places for entrepreneurs including Google Campus and WeWork. In addition, they learnt most from books and use Shapr – an app for entrepreneurs. Running a company from home resulted in problems with the landlord, and customers asked for where the business was located.
Networks, mentoring, training and combatting social isolation
Much discussion was around meeting spaces including co-working spaces, i.e. spaces home-based entrepreneurs can use to ‘get out of their home’, meet other entrepreneurs and get advice and support from others. It was concluded that policy should support co-working and meeting spaces in residential areas, outside city centres. Successful examples presented included informal co-working spaces in community centres (Christchurch and East Dorset Council) and at the premises of the Chambers of Commerce in Vienna. These examples do not only provide meeting and working spaces for home-based entrepreneurs but also combine the provision of space with business support and mentoring. The City of Milan supports co-working through vouchers to individuals, alongside the establishment of fully equipped Fablabs enabling the home-based entrepreneurs to use the machinery normally unavailable to individuals.
Linking physical facilities with online support is further important, like in the case of Austria, to reach out to home-based entrepreneurs who are not located in cities. The Chambers of Commerce provides webinars, alongside face-to-face seminars and meetings with expert.
Lucia Scopelliti from the City of Milan presented the SCALE initative (Startup City Alliance Europe) which is an online platform helping to provide information how to start-up a business across European cities. The demand for such a platform was clearly articulated by entrepreneurs at the seminar – in terms of starting the business but also growth (finding business partners).
Finance and business advice
We identified micro-finance schemes that appear to be particularly suitable for home-based businesses because of their scale and in the case of the U.S. micro-funding program because of the local administration of the funding through local stakeholders rather than state government or bank lenders. The European Commission has also started a micro-funding business scheme (EaSI – EU Programme for Employment and Social Innovation), where one of the objectives is to increase the availability and accessibility of microfinance for vulnerable groups and micro-enterprises.
The Australian New Enterprise Incentive Scheme (NEIS) is another example how to encourage small-scale business start-ups of disadvantaged groups. NEIS is aimed at job seekers and they are in the first instance encouraged to start a business from home. In fact, it is estimated that 62% of their recipients are home-based. In addition, business advice in Australia is organised locally through entrepreneurship facilitators who work in local communities and clearly see the relevance of supporting home-based businesses.
Planning regulation and urban planning
Jake Wiersma from the Municipality of Maastricht presented results from a study of solo self-employed in the Netherlands. They are located in the ‘most boring’ areas of towns, i.e. in suburban areas, rather than cities. Similar findings were reported from Austria. It was discussed that designing cities and towns for small-scale businesses should include re-using of vacant buildings as well as the design of multi-use buildings.
Inclusive entrepreneurship and inclusive growth
Home-based businesses have the potential to support inclusive entrepreneurship. Home-based entrepreneurship is associated with lower resources needed and lower risk involved. There is evidence that women are overrepresented amongst home-based entrepreneurs. The U.S. microloan scheme has been successful on including ex-convicts on probation in entrepreneurship.
In this context, there was the discussion around inclusive growth and the need to understand growth not only in economic but also in social terms.
Acknowledgment: We are grateful to the UK Economic and Social Research Council for co-funding the seminar. We thank all participants and speakers for their valuable contributions and a stimulating discussion.