Buy local. It’s a well known strategy for small towns. Keeping your grocery money close to home keeps the grocery store close to home. Economists tell us that every dollar spent at a locally owned business generates two to four times the economic benefit.
But what if we take it to the next level? What if we “invest local” too?
The concept is an extension of “buy local” campaigns that urge us to capture the multiplier effect of commerce by keeping our spending money close to home. You already see it all around you in small towns. Often it takes local citizens to see opportunity where an outsider would overlook it.
In our hometown of Lyons, Nebraska, a new hardware and feed store went up on Main Street this summer. The owner and his family have run independent businesses in Lyons for two generations. It’s not a Menards, or a Bomgaars. Those companies would never build here.
My hometown of Laurens, Iowa, took it upon themselves to build a broadband network that delivers high-speed internet to every house and business in town. They didn’t wait for Comcast or Verizon to build a network. If they had, they might still be waiting.
Local residents, rooted in place, are often willing to take a financial risk to make their small town a better place. Imagine if more of us joined them, investing locally. What does your town need to be a more vibrant place?
Do you need a grocery store? Or quality rental housing? What is your role in meeting those needs? Instead of investing in the stock market, savings bonds, or bank certificates, what if you invested in your home town?
You might become an entrepreneur or landlord yourself. Or you might invest in a local economic development loan fund. Recent changes to securities laws are making such funds easier to establish. If you are an entrepreneur, you could try soliciting local investors to finance your startup or growth.
What would this look like in your town if more people also “invested local”? I don’t know all of the answers. But I do know if we wait for outside investors to save our small towns, we will be waiting a long time.
It’s time to send less of our investment money to Wall Street, and more of it to Main Street. The future of small towns will be built by the people who live there.
Feature image: Steiny's General Store, a new business on Main Street in our hometown of Lyons. | Photo by John Crabtree
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