A CEO ponders her next move while attending a retreat sponsored by an entrepreneurial support organization on the foundation grounds.

The true wellspring of an entrepreneurial economy is second-stage companies, which create the bulk of new, sustainable jobs and provide an economic engine for significant growth. Second-stage companies are those that have passed the startup stage and have the capacity and intent for rapid growth. Typically, such companies have annual revenues between $1 million and $50 million, and they face issues of growth rather than survival.

Driving second-stage businesses are their owners, often the founders, whose decisions — especially at this growth stage — are critical to their companies' futures. To make the right decisions, business owners need information and insight that they trust enough to act on. Their most credible sources for such information and insight are their entrepreneurial peers, who share similar responsibilities, stresses, opportunities and passion for growth. Within a region, these peers — second-stage business owners — constitute an "entrepreneurial cluster" that operates horizontally across industries. An effective entrepreneurial cluster accelerates regional economic growth.

Effective operation usually occurs through formal or informal networks of entrepreneurs and is greatly enhanced through facilitated roundtables of business owners within those networks. These networks and roundtables can significantly influence the economic-growth potential of a cluster. They need support and guidance as they develop to fulfill their critical roles as ongoing communications channels through which entrepreneurs build relationships, exchange information and learn from each other.

The Edward Lowe Foundation seeks to fulfill the mandate of its founders, Ed and Darlene Lowe, to "champion the entrepreneurial spirit," based on their belief that entrepreneurship is the cornerstone of the free enterprise system. Ed Lowe's passion for entrepreneurship led him to study the nature of entrepreneurship and to develop a practical approach to advancing the field. Specifically, he came to believe that entrepreneurs learn best from other entrepreneurs — peer-to-peer learning among business owners, CEOs and presidents. To fulfill the promise of this belief, the Edward Lowe Foundation provides assistance to not-for-profit organizations that share Ed Lowe's commitment to peer learning as a process to help second-stage business owners take their companies to the next level.

Source:"The Role of Second-Stage Companies and Peer Learning in Regional Economic Development," Edward Lowe Foundation, March 2004.

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