Patti Lind¹
The Abilities Fund

Setting the Foundation for Economic Empowerment

While the vision of small-scale business ownership is as old as this nation, the microenterprise field is relatively young. Emerging about two decades ago in the United States, it was born largely through the efforts of women's organizations that sought to help women to use business ownership as a means to improve their economic situations.

While other small business policies and programs existed to assist small and minority-owned firms, many women found that the services offered did not meet their requirements, and as a result, a new set of programs was created to provide training and credit to these entrepreneurs.²

A microenterprise is typically defined as a business with five or fewer employees that requires $35,000 or less in start-up capital and does not have access to the traditional commercial banking sector.³ Microenterprise development organizations exist to offer business training, technical assistance and financing options for these small and previously underserved ventures. Using the model of microenterprise development as an economic equalizer, The Abilities Fund acts as a conduit between entrepreneurs with disabilities and microenterprise organizations throughout the country. Since its inception in 2000, The Abilities Fund has watched the requests for these linkages double with each passing year, resulting in hundreds of successfully facilitated business starts.

Within the context of self-employment for women and other minority populations, and in consideration of an industry that is being asked to serve the emerging market of entrepreneurs with disabilities, one question that is often proposed yet difficult to answer has been: How many people with disabilities are, by measure, potentially self-employable?

Recognizing twenty years of microenterprise development in the United States, FIELD (The Microenterprise Fund for Innovation, Effectiveness, Learning and Dissemination) of the Aspen Institute has completed a "state of the industry" publication entitled Opening Opportunities, Building Ownership: Fulfilling the Promise of Microenterprise in the United States. The FIELD research connects census data with self employment statistics and makes several startling observations: Of the 49.7 million people who reported themselves as having a disability on the 2000 census, 30,553,796 are non-institutionalized working age adults between 21 and 64 years of age.⁴ U.S. Census data from 1983 found that individuals with disabilities were almost twice as likely to engage in self-employment as those without - 14.7 percent vs. 8 percent.⁵ Similarly, researchers with the U.S. Department of Labor found that women with disabilities were 1.5 times more likely to engage in self-employment than those without, and that men with disabilities were 1.3 times more likely to engage in self-employment.⁶ With this and other data from the Current Population Survey (CPS) of the U.S. Census Bureau, FIELD estimates a potential rate of self-employment among disabled individuals by applying a factor of 1.5 times the self-employment rate for all workers of 6.8 percent in 2000⁷, yielding a self employment rate of 10.2 percent for disabled individuals.

When considering the potential size and scope of the market for microenterprise development services as applied to the total number of working age individuals with disabilities in 2000, this yields an estimated 3.12 million individuals with disabilities who would be self-employed⁸. Simply defined, this means that more than 3 million Americans with disabilities could be benefiting from the training and credit assistance provided by the microenterprise industry. But are they?.

Although the number is staggering, the fact is that recognizing this economic opportunity often evades both the individual and the organization. Even with a well developed business idea, at a minimum the challenge of business ownership is aggravated for individuals with disabilities who experience a high reliance on restrictive public assistance, limited support for self-employment from publicly funded rehabilitation programs, and associated credit and equity barriers. As well, the microenterprise industry has been hesitant to reach out to a population that is not yet defined as "disadvantaged" by federal agency standards - who represent a significant source of funding for microenterprise organizations.

Finding a Place at the Economic Development Table

Challenging as it may seem, the acknowledgment of people with disabilities as promising entrepreneurs is growing. Much like twenty years ago when the notion of self- employment for women was fundamental to the creation of the US microenterprise industry, so will the impact of people with disabilities be to the continued growth of it. The field has been largely successful in assisting individuals who experience greater barriers to business development, especially women, minorities, and low-income individuals.9 As organizations work to scale-up to serve more entrepreneurs, the result will surely benefit the emerging market of entrepreneurs with disabilities. In doing so, equal access to training, credit and equity products will be part of the residual effect. The model is in place and, for the most part, progress is being made.

Coast to coast, organizations and individuals are working to clear their respective pathways to self-employment. Disability-specific programs within microenterprise organizations are offering training, one-on-one technical assistance and, often more importantly, access to credit and equity products. One demonstration is the Brooklyn Economic Development Corporation, a New York-based microenterprise organization that markets their LAUNCH Program to individuals with mental health disabilities and offers basic business development classes as a means to accessing small loans for business start-up.

In Colorado, MicroBusiness Development Corporation targets promising entrepreneurs with disabilities, along with other low income populations, and offers an accessible computer lab, access to capital and asset building through their Individual Development Account program. In Oregon, Lane MicroBusiness has been successful leveraging equity grants from The Abilities Fund for their entrepreneurs with disabilities after feasibility assessment and business planning take place.

Although these represent only a few examples of the potential for innovation in microenterprise organizations, the common thread among organizations that effectively serve entrepreneurs with disabilities is the access to credit and equity product component. Without it, promising entrepreneurs are likely to find space in the classroom to learn how to create business plans for succeeding in the marketplace - but will be unable to capitalize those business plans - and, ultimately, their ability.

While things are looking up, encouraging expansion of an existing industry to offer self-employment for people with disabilities is one thing - cultivating it is another. It is not overly difficult to educate a service industry about an emerging market; especially an industry that is already based on entrepreneurship and looking to scale-up by serving more clients, while extending these services in a more efficient and effective manner. It is, however, very challenging to develop the resources critical to ensuring that they can and will be served.

To realize full inclusion for people with disabilities, expanded resources must include mainstream business development agencies at the federal and state level in emphasizing disability as an eligibility guideline for program funding - particularly the capitalization of loan funds within microenterprise organizations. From the rehabilitation side, publicly funded agencies like Vocational Rehabilitation and services for blind individuals, coupled with consumer organizations, will need to commit to continuing to advance their newfound acknowledgment that people with disabilities can be successfully self-employed in sustainable business ventures.

In the funding environment, foundations and philanthropic organizations that already fund the field and value microenterprise as a poverty alleviation method need education about including disability in the mix of targeted populations. Furthermore, new funders need to be attracted to investment in the microenterprise industry and the value of supporting entrepreneurs with disabilities as an economic development strategy. As well, local, state, regional and national level commercial lenders that define low income individuals as "unbankable" will meet the credit needs of the full community and, at the same time, contribute to the growth of tomorrow's customer base by choosing to seed microenterprise loan funds targeting entrepreneurs with disabilities. Finally, individuals with disabilities will have to expand their own thinking and actively include self-employment as a real opportunity in the framework of employment options.

The challenge in getting there is neither singular nor simplistic. Rather, it is embedded in the need for systems change on individual and organizational levels, in funding communities, and in credit systems. The Abilities Fund is in it for the long run and, as the mission statement reads, is committed to the economic advancement of people with disabilities and devoted to the fullest expression of their entrepreneurial spirit in all its diversity, strength, and boundless originality.

Read the full text of the FIELD Report at Opening Opportunities, Building Ownership: Fulfilling the Promise of Microenterprise in the United States.

1 Abilities Fund co-founder and Executive Director, Patti Lind, offers more than a decade of experience in microenterprise development for disadvantaged populations including women, minorities, refugees, veterans and individuals with disabilities. For the past ten years, her work as a microenterprise developer has been focused on serving promising entrepreneurs with disabilities nationally. As well, she has worked with public and private rehabilitation and microenerterprise organizations in twenty states to build their capacity to effectively facilitate business development for entrepreneurs with disabilities.

2 Edgecomb, Elaine L. and Joyce A. Klein. Opening Opportunities, Building Ownership: Fulfilling the Promise of Microenterprise in the United States. Washington, DC: Aspen Institute (FIELD), 2005.

3 AEO. Available from http://www.microenterpriseworks.org; Internet

4 Houtenville, Andrew. Disability & Employment in the USA: National Overview Based on the 2000 Census (RRTC, 2002)

5 Seekins, T. Rural and Urban Employment Patterns: Self-employment as a Metaphor for Rural Vocational Rehabilitation. Missoula, MT: Rural Institute on Disabilities, The University of Montana, 1992.

6 Messenger, Jon C. and Andrew Stettner. The Quality of Self-Employment Jobs in the United States. Geneva: International Labour Office, 2001; available from http://www.ilo.org/public/english/employment/finance/download/us6.pdf; Internet.

7 Hipple, 14.

8 Edgecomb and Klein, page 15.

9 Edgecomb and Klein, page 31.