Can social entrepreneurs close the local income gap? Toan Nguyen thinks so.

Theory and practice 

Elizabeth James enrolled in CIC on a leap of faith when she decided she was fed up with the suffocating and unappreciative culture of the Fortune 500 companies she’d worked for for years. A widow who raised three children on her own and struggled to find her niche in the community after her husband died, she traded her suit in for an apron in 2011 and founded her sauce-making business, the Happy Tomato.

Elizabeth James left her corporate career to start a sauce-making company from her own kitchen, and said she wouldn’t be where she is now without CIC. Photo: Elli Williams
Elizabeth James left her corporate career to start a sauce-making company from her own kitchen, and said she wouldn’t be where she is now without CIC. Photo: Elli Williams

“There’s so much information out there about starting a business, you just don’t know where to go at first,” James said.

She quickly learned that starting and maintaining a business was about more than just learning the skills, and said the networking and companionship built through CIC were invaluable.

“I was sitting with a group of people I wouldn’t have had the opportunity to meet otherwise,” James said, noting the cultural diversity of her CIC classmates. “It’s not just this pansy course. We were working with the brain power of seven to eight other people who all had their guts in the game also, and we challenged each other.”

With the mentoring, networking, and funding through CIC, James was able to launch her tomato sauce-making business just a few short months after the idea was born, and a year later, the sauce she makes and cans in her own kitchen with locally grown produce is available at four locations, and is soon coming to Whole Foods.

Alongside her in class was Terry Lee Jones, a painter and craftsman who’s been in Charlottesville since 1958. When he started Terry’s Painting Service in the 1970s, Jones said he was able to work on a case-by-case basis, taking money earned from one job and putting it into the next. But when the economy dropped and he began struggling financially in 2005, Jones said he realized there was more to running a business than he thought.

“Not a lot of people have this gift, and I can’t take it for granted,” Jones said. “But I still know that the paper and the books have to be straight, and I didn’t do that.”

After graduating from CIC in 2012, Jones was one of the first business owners to join C’ville Central, and it’s paying off already. In the first month contracting with C’ville Central, Jones brought in more than half the amount of revenue he earned all last year.

“If everybody just takes the time and looks into C’ville Central and CIC, they’ll find out that it’s very profitable,” Jones said. “It’s all about trying to make sure that everything is done like it needs to be done, on a very professional level.”

With its many moving parts and stakeholders, the concept of alleviating poverty through entrepreneurism is gaining popularity worldwide. Schools like Sarah Lawrence College and Tulane University now offer classes on creating social change through business. Corporate giants like Coca-Cola, Goldman Sachs, and ExxonMobil have launched programs to bolster entrepreneurship across the globe, especially among women. Then there’s Ashoka, an organization launched in the 1980s that provides start-up financing and network connections for nearly 3,000 entrepreneurs worldwide.

Here in Charlottesville, the city is considering buying into the idea of social entrepreneurism using public money. At the August meeting, City Council members and city staff discussed Section 3, the provision of the Department of Housing and Urban Development Act of 1968 that promotes local economic development and self-sufficiency, requiring that localities receiving HUD assistance provide job training, employment, and contracting opportunities for low-income residents in connec-
tion with neighborhood development projects. Section 3 Coordinator Tierra Howard and Neighborhood Development Services Director Jim Tolbert proposed that the city redirect some of its housing funds to the program, which would provide employment for low-income residents and in turn create more public housing for the community. City Councilor Kathy Galvin said the proposal needs some work before Council votes on it, but she is in favor of the concept.

Galvin, who said ending poverty through employment has been a focus of hers since she ran for office, agrees that the current system isn’t working.

“We don’t do enough to make sure that people are getting out of poverty through work,” Galvin said, adding that the city should refocus its efforts from housing to employment. The city’s housing fund has accumulated $5 million over the last five years, which she said is a wonderful accomplishment, but she wants to see equal emphasis and funding put into getting people out of poverty.

“There’s almost a sense that once you’re poor, you’ll always be poor. A thought that if you just provide housing, that will stabilize people and they’ll get out of poverty themselves,” she said. “That doesn’t happen.”

“We’ll never get out of this catch-22 of building housing, people getting into it, and then staying in poverty, unless we start using resources to couple jobs with housing,” Galvin said.

Charlottesville Regional Chamber of Commerce President Timothy Hulbert said Charlottesville’s poverty can be difficult to recognize because “the prosperity is all around you.” But factors like expensive property for workspace, inaccessible child care, and lack of transportation all contribute to the challenges surrounding entrepreneurship. A sound business plan is the foundation, he said, and when given the opportunity, most people will jump on the chance to pull themselves up.

“If you give people a shot, most of them will succeed,” Hulbert said. “Some of us just need more support than others.”

Building and supporting enterprises in the orange dot demographic is no easy task, Hulbert said, and he noted four out of five new business ventures fail within the first five years.

“Then again,” he said thoughtfully, “four out of five don’t have Toan driving them.”

It’s been 40 years since Nguyen left war-torn Vietnam with his mother and brother, anxious to return and finish his father’s work. His desire to go back has come and gone, but the concept of using economic savvy for social change can apply anywhere, so he ran with it where he landed.

Nguyen said C’ville Central still needs another year or so to evolve and stabilize before it’s ready to take on large, long-term contracts with institutions like UVA. Within the next three years, he said, he predicts the corporation will include 20 to 30 businesses, and have generated enough revenue in sales to take out multi-million dollar bank loans. Also on the horizon is a new website to be launched next summer, and a cross-country roadtrip to teach and learn entrepreneurism techniques. Nguyen’s already working with Richmond city staff to help them establish a hub like C’ville Central, and he said his ultimate goal is to open offices all around the nation based on what’s worked for people in the low-income community here here.

“The government can’t take care of them anymore,” Nguyen said. “We need to use the power of business, because just giving money to a nonprofit is only taking care of them, not teaching them.”

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