Foreign-born business ownership grows in Rochester
November 2, 2013 | Posted by admin

Twice as likely to start a business, immigrant owners generated $600 million in sales, employed 5,000.

Mohammed Shoble, 27, orginally from Somalia, now owns Northside Auto Repair on North Street in Rochester. (Photo: SHAWN DOWD)

Two months ago, Mohammed Shoble bought Northside Auto Repair at 462 North St., realizing a dream he had since fleeing war-torn Somalia in 1996, when he was only 13 years old.

“If you have ambitions and goals and you pursue it you will achieve your goals. The opportunity will not come to you. You have to look for it,” said Shoble, now 27.

Throughout the Rochester area, refugees and immigrants like Shoble are staking claim to their own version of the American dream, by establishing businesses, creating jobs and helping to drive the local local economy.

Sometimes, their businesses continue a career started elsewhere. For others, running a business is an entirely new adventure, often prompted by the difficulties of finding work in an unfamiliar world.

“The history of a lot of city neighborhoods is that they sort of get re-energized, re-invigorated through new immigrant groups coming in, establishing homes, renting, and then buying, and then starting businesses in those neighborhoods. It’s a great recipe for keeping neighborhoods fresh, keeping storefronts open,” said Jim Morris, director of refugee immigration services for theCatholic Family Center.

And immigrants are more than twice as likely as native-born residents to start a business. In 2011, the immigrant business-formation rate was 550 new businesses per month for every 100,000 immigrants, while the native-born rate was only 270 new businesses per month for every 100,000.

But the trend is slowing, according to the Kauffman Foundation. It reports that the number of high-tech, immigrant-founded startups nationwide declined from 25.3 percent to 24.3 percent since 2005.

SUPPORT GROWS

The motivation and experience of starting a small business can be very different for an immigrant entrepreneur. Often they focus on providing food or other products and services that are in demand within an existing ethnic community, said Virginia Smith, director of the Rochester office of the U.S. Small Business Administration.

Funding is often raised from relatives. The SBA does not sponsor loans for non-citizens.

“They might be starting from their kitchen for example, or their living room and eventually they grow into a bigger business that then would go to financing to a local lender,” she said.

In Rochester, an increasing demand for support services for immigrant entrepreneurs has triggered plans by several groups to provide training.

“It’s something that’s on our radar collectively as well as within (Catholic Family Center),” said Morris.

Morris said the Catholic Family Center will offer entrepreneurial seminars next year.

Del Smith, director of Rochester Institute of Technology’s Center for Urban Entrepreneurship expected to open next year, said the center will assist other agencies in providing programs for immigrants.

Hubert Vantol, senior director for economic development for PathStone, a non-profit community development and human service agency, said his organization is about to start a new program to assist Somali immigrants who want to start new businesses.

“We’ve done a lot of small business training in the Rochester area over the past dozen years or so, but this is where we’re trying to adapt this for people who aren’t particularly familiar with the language and the customs. That part of it is an experiment for us,” he said.

P. Reffell Conteh, president and CEO of the Wachuku Foundation, 130 White St., an organization that provides job training for immigrants, is planning to work with the Center for Urban Entrepreneurship to provide support services for immigrants who want to start businesses.

“There is a very significant immigrant population here in Rochester that takes part in what we consider to be entrepreneurship which is almost due to the obstacles that they have when they come to the country and they’re not acculturated and they don’t know the language,” Del Smith said.

In some ways, the social disadvantages of immigrants is what’s driving them to start their own businesses, he said.

“A lot of people go into entrepreneurship, not because it’s some ideal work environment for them, or something they’ve always wanted and dreamed of doing, but they go into entrepreneurship because they feel like their opportunities are limited in their surroundings,” he said.

“The immigrant population, more than anyone, we find really goes into entrepreneurship and they see it as a way to support themselves and their families when they’re in an environment that is otherwise very difficult for them to go out there and get a job,” he said.

SOME ADVICE FOR IMMIGRANT ENTREPRENEURS

  • Save up as much money as possible before starting. Don’t expect to start paying back loans right away with profits. Try to save up for the first year, or two.
  • Start small. Don’t rent space if you don’t have to. Don’t hire employees until you can keep them all busy. Try contractors or temp workers at first. Try starting in a garage, or in your house.
  • Protect your personal assets. Buy liability insurance and consider forming a corporation or limited liability company.

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Twitter.com/BennettLoudon

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