During Global Entrepreneurship Week (GEW) we recognize the accomplishments of our entrepreneurs and their impact on our society. We participate in events to learn about what entrepreneurship is, why it’s important, and how it can be taught. Since the initial commitment of 18 host countries in 2007, the list of countries joining the Global Entrepreneurship Network in celebrating and encouraging entrepreneurship has grown exponentially. As Richard Branson put it in his 2020 GEW salute: “Entrepreneurs are the dreamers, the doers, and risk-takers that have the opportunity to transform society for the better”. With his words in mind, maybe we should think about how we can invest in women and men developing solutions to our problems.

We can all start small. As consumers, we can choose to buy goods and services from local entrepreneurs who strive to provide us with innovative solutions. Buying a gift from a local entrepreneur selling t-shirts out of an old Volkswagen camper so that we all stay “Japi” may cost a bit more than a similar item at a big box retailer, but it goes a long way into contributing to our local economy and adding value to a relationship thanks to the items’ uniqueness. Local entrepreneurs care about the same things we do, and this not only shows in their products but also in how they make them. A cup of coffee from a local ecological producer supports the coffeemaker, and it also supports the sustainable use of our natural resources and strengthens our capacity for long-term agricultural production that can benefit future generations.

Those that have money to invest should peek into the local entrepreneurial ecosystem. Innovative impact-oriented businesses are in constant need of investments to improve, grow, and expand their reach. Successful entrepreneurs develop products driven by their intended market. However, even when there’s verifiable demand, an entrepreneur may have difficulties financing the delivery of its solutions. At an early stage of development, the uncertainties surrounding new ventures make it extremely difficult for young companies to secure loans. Here risk capital is needed to grow to a commercial scale, facilitate geographic expansion, and continue to evolve into mature business models.

Investors able to manage risks related to equity financing are extremely important in developing an entrepreneurial community. Venture capitalists, those providing capital to new ventures in exchange for a stake in the company, also often provide mentorship, business connections, and support systems to their investees. In recent U.S. history, venture capital investments have delivered huge productivity gains by way of financing new information, communication technologies, and innovations. In 2018, out of the ten most valuable companies in the world, seven of them were humble start-ups funded by venture capital. These include — Apple, Amazon, Alphabet (Google), Microsoft, Facebook, Alibaba, and Tencent. Investors unable to invest on their own can opt to invest through a Community Development Venture Capital (CDVC) fund. These are funds managed by experienced investors that provide capital, entrepreneurial experience, and ingenuity to businesses in underserved markets. CDVC funds are serious about providing financial returns to investors, but they also focus on a second bottom line: creating good jobs and providing equity capital to entrepreneurs. CDVC funds seek out businesses whose success and rapid growth can satisfy both the financial and social bottom lines. Puerto Rico is proving to be fertile ground for these types of investments and has already seen several funds organized with this focus. This will enable our economy to close the loop on a virtuous cycle that creates venture-backed entrepreneurs who can in turn bet on new companies as business partners, consumers, or investors. Let us also celebrate this during GEW and remember to invest in our local entrepreneurs.