Professor Tom Cooney is one of the biggest supporters of Diversity and Inclusion in entrepreneurship in Ireland today. Through his experience over 15 years specialising in working with minority communities, he and his team have provided entrepreneurial courses for underrepresented groups such as people with disabilities, immigrants to Ireland, ex-offenders and at-risk youth. He believes that this is an untapped resource of significant entrepreneurial potential and offering appropriate support could enable people from these communities to maximise their economic and social potential.
1. Why did you start to focus on underrepresented groups in entrepreneurship as part of your research?
In 2006, we as a country were going through the Celtic Tiger. It was a huge boom, but I felt that certain communities didn’t have the same opportunities as the majority population to enjoy its success. I was brought up to respect and value everybody equally, and so I wanted to encourage people from minority and disadvantaged communities to fulfil their economic and social potential.
I had a skill set in entrepreneurship education and I began to deliver entrepreneurship training programs for disadvantaged groups. We started with immigrants, then people with disabilities and others then followed. I established the Institute for Minority Entrepreneurship within the Dublin Institute of Technology (now Technological University Dublin) to help people to start their own business. I have often argued that if the business is not sustainable then I believe they should not do it, whether one is from a minority community or not. There are substantial economic and social benefits to the country in training underrepresented groups to start their own business and these are not fully understood.
I believe that we all have 4 broad choices regarding how we generate income to put food on the table:
A. Get a job – as an employee you pay taxes which is good for the economy.
B. Create my own job – again you pay taxes and this will benefit the economy and grow more jobs.
C. Social welfare support – this is a negative cost to the economy because it costs the government to implement it.
D. Crime – this is one of the biggest costs to the government. It costs €90,000 per person per annum to keep someone in jail. In addition, there are other costs to the state in terms of criminal damage, policing, criminal justice system, etc.
The purpose of our work is to offer entrepreneurship (option B) as a career for people in disadvantaged communities and to take people away from options C and D (if that is where they are located) which would be a huge gain for the economy. If they are in option A (have a job), then they are less likely to need our support.
2. What are some of the biggest barriers towards underrepresented groups starting their own business?
The barriers facing people from disadvantaged communities can be broken into four main areas:
A.. Lack of recognition by government, government agencies and private industry of the additional and distinctive challenges that they face – arguments such as “We treat everyone the same” and “Our Door is open to everyone” is simply not true for underrepresented groups. They have additional and distinctive challenges that mainstream entrepreneurs do not face. We have little tailored entrepreneurship support in place for people from these communities who wish to start their own business.
B. Greater difficulty in access to finance – there’s a lack of trust on both sides. For example, some immigrants have trust issues with authorities given their previous experience. People like suppliers or customers may have trust issues with building relationships with entrepreneurs from minority communities. Research has shown that people from Africa experience the highest levels of distrust, but also the Roma community and members of the Travelling community in Ireland also experience high levels of mistrust which makes it difficult for them to grow a business.
C. Networking – many people from minority communities will come from positions where they do not have the same opportunities in terms of creating a network as people from the mainstream population. Additionally, because of a lack of capital, they do not have useful access to finance and this is where many businesses fall down. Many people are in poorly paid jobs, so they may have poor credit ratings, and they are also time poor, so they cannot go to events where they can grow their network.
D. Institutional barriers – this is in terms of regulations and cultural norms which frequently are biassed against people from minority communities. .
3. Can you take us through some of the different courses that you have for underrepresented groups?
We started with Immigrants, then moved on to people with disabilities, seniors, LGBTQ+ and female Travellers (who faced the greatest challenges of all). However, it was frustrating because once the programmes finished there was no follow through, so we don’t know how those businesses that came through the programmes performed afterwards.
One of the most interesting courses was one I delivered inside a prison. This was a real learning experience for me. Research shows us that almost 50% of ex-prisoners are back inside prison within 4 years. The system isn’t working. We know that the chances of employment for ex-offenders are extremely low, so their main economic choices frequently are welfare or crime. There is little entrepreneurship training for prisoners and there is little support when they leave prison in terms of business start-ups. We need to build an infrastructure around them to provide tailored support and encourage self-employment as a career option.
From 2012 to 2020 we focused on research and dissemination, but last year we finally got funding for a long held ambition to design and deliver a tailored course for people with disabilities that want to open their own business. We have recently completed a course with the first cohort of students taking part in this course and we cannot wait to see the results of what businesses come out of that initiative.
4. What are some of the most frequent business mistakes you see from this cohort, when they are thinking about starting their own businesses?
There are a wide variety of business mistakes, but the following arise most frequently:
A. Overestimation of the business idea in terms of sustainability – this is one of the most common mistakes with all nascent entrepreneurs, but more exaggerated with underrepresented groups. People convince themselves that their idea is wanted by everyone and it can be difficult to get people to be realistic in terms of the viability of their business idea.
B. Self Confidence – the world has been hard on them in many ways. Imposter syndrome is rife within these groups. That is why it is important to be frank with them. It could be hugely damaging to go ahead and launch the business and it fails. I don’t patronise, but I want them to believe the business can work themselves, but also see where it needs more work, if there are flaws in it.
C. Poor financial literacy – SME owner-managers generally have poor levels of financial literacy and do not appreciate the value of understanding their financial accounts or key monthly figures (e.g. sales, cost of sales, outstanding debtors, cash in bank). Again, with entrepreneurs from minority groups, this problem is frequently more exaggerated.
There is also a general failure to properly research and test the idea. Instead people will frequently believe in the viability of their business idea based on feedback from their family and friends which does not constitute good market research.
5. What more could the colleges or government do to encourage people from underrepresented groups to open their own business?
Again, I will divide this into four categories:
A. Government – I strongly believe there is a need for a written strategy regarding inclusive entrepreneurship. Outside of women, little work has been done on underrepresented groups. The Comprehensive Employment Strategy for People with Disabilities has little mention of self-employment. There is no entrepreneurship strategy targeting immigrants, seniors, ex-offenders, marginalised youth or long term unemployed even though the OECD has called for greater action relating to ‘Missing Entrepreneurs’.
B. Welfare system – At the moment it is a binary system, either you can work or can’t. People with disabilities may be able to work, but may need to step away occasionally. When this happens, they may need to re-enter the system which can be quite difficult. The welfare system needs to be more of a continuum along which people can move, so that people have a safety net if they fail. The ‘welfare benefit trap’ is enormous, not just in Ireland but in many countries.
C. Government Agencies – They need to recognise that treating everyone the same is not the answer and that disadvantaged communities need more support.
D. The Third Level Education system – There needs to be a lot more support here. The Further Education Colleges, ETBs, and LEOs do their best, but universities can research and support this area a lot more. There are very few PhD students interested in this area. Research and reports create change, so the more universities invest in this area, the more results they will get.
The OECD has published excellent reports on what can be done to support people from minority communities to become more active in terms of entrepreneurial behaviour.
6. Are there any success stories so far from the courses?
When we stopped offering training courses in 2012, we stopped tracking the businesses that had started from our programmes. Therefore, we don’t know what happened with these groups from the past. We’ve only just started with the new groups, so we’ll see what happens there.
7. What effect did the pandemic have on the courses? Are there any positives that can be taken from this period?
The pandemic created a situation where underrepresented groups were disproportionately made unemployed due to discrimination, the nature of their job and the nature of the industries they work in. Previous ESRI research indicated that after the 2008-12 recession, people from underrepresented groups took longer to re-enter the workforce compared to unemployed people from the mainstream population. So we used this argument to get funding for a people with disabilities course. The course was a pilot but it offers us the opportunity to repeat the format with other groups and we will take that plan forward. There is undoubtedly discrimination taking place and so we should encourage people from minority communities to get involved and develop skill sets to allow them to become self-employed.
8. Are there any groups within the underrepresented groups that you want to target, but haven’t gotten to yet?
I’d like to get significant funding to do more work with ex-offenders. The course for people with disabilities will continue running. I’d also like to focus on marginalised youth – it’s a huge issue becoming more marginalised and the threat of a family cycle repeating itself is significant. Refugees is another group that I’d like to target as the situation with Direct Provision centres is wrong. For refugees, getting a job is so difficult and also many of them have been through traumatic experiences. Some of them will have entrepreneurial skill sets from their home countries that we can tap into. They can help Ireland grow our exports as increasing international trade is a priority for the country. Approximately 10% of the population are immigrants and they have the connections with their home countries to help Ireland develop its export potential.
9. You have a large social media presence, are there any academics in this field that you would recommend following?
To be honest I focus on sharing content on social media, and I don’t really follow any particular influencer.
10. Outside of the company that have come through the course, are there any other companies involved in Diversity and Inclusion in Ireland that you are a fan of?
Open Doors Initiative – they have had huge success in getting people from marginalised communities placed into sustainable employment, they are excellent.