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Rural communities seeking to build a tech economy often face a steep uphill climb to success. 

Yet there’s one long-running and highly competitive federal initiative, the Economic Development Administration’s Build to Scale (B2S) program, that offers a proven pathway for rural communities to cultivate innovation and tech-driven businesses that create quality jobs and drive local economic growth.

The program has historically set aside 40% of funds for rural regions and continues to prioritize investment in underserved communities, making it a powerful tool for rural applicants that are otherwise competing against better-resourced urban areas.

But the Center on Rural Innovation, which has worked with rural communities to develop Build to Scale applications since 2018, wanted to dig deeper: What do rural Build to Scale winners have in common? 

To find the answer, CORI set out to see what the data says about our experience supporting more than 30 Build to Scale applications — that awardees share common attributes, including strong local leadership, innovation-friendly institutions, a skilled workforce, and access to capital.

That effort resulted in the following interactive tool, which allows users to see these trends and compare their communities to ones that have already secured Build to Scale awards:

Why focus on these economic indicators?

This tool focuses on four indicators that are grounded in CORI’s firsthand experience working with rural communities to apply for Build to Scale funding:

  • Local leadership: Strong, committed community leaders who are actively involved can  make connections across sectors, get stakeholders working together, and help make the most of a B2S award.
  • Innovation-friendly institutions: Communities with universities or other institutions that support innovation are better equipped to use a Build to Scale award to foster tech growth, and, crucially, help provide skilled workers for tech roles.
  • Skilled workforce, industry composition, and business volatility: A community that already has a skilled workforce and a mix of businesses is a safer bet for investment, as it shows potential for tech-based projects and less reliance on any one industry.
  • Access to capital: Places that can attract both private and public funding show they have the resources and connections needed to leverage a B2S award.

Measuring Build to Scale readiness

We identified and modeled key economic conditions that existed in communities prior to their successful Build to Scale applications. Next, we applied the model to current economic conditions to generate predictions, called the Build to Scale Readiness Score, for rural areas that have yet to win B2S funding.

The Build to Scale Readiness Score can help communities understand where they are and how they compare to previous winners. A low score does not imply a community lacks the assets needed for a winning application. Instead, the Build to Scale Readiness Score should be viewed as a tool to help communities understand what strengths they can leverage for a competitive application.

Common traits among rural Build to Scale recipients

During CORI’s analysis of community-level data for previous rural B2S recipients, it became clear that they shared several statistically significant traits during the years in which they won. Compared to rural communities that have not won Build to Scale funding, past rural winners displayed:

  • Local leadership: They scored higher in terms of local leadership capacity (74) than the rural average (51), as calculated by Headwaters Economics.
  • Innovation-friendly institutions: They were more likely to be near a higher education institution — 87% of rural winners were located within a 30-minute drive compared to 45% of communities that haven’t secured B2S funds.
  • Skilled workforce, industry composition, and business volatility: They had roughly twice as many residents (39%) with at least a bachelor’s degree, more than double the share of tech jobs, a higher share of employment in tradable services (21% to 16%), and a lower share of employment in tradable goods (45 vs. 31%), which are more susceptible to automation and outsourcing.
  • Access to capital: They showed an ability to mobilize investment capital — 39% raised capital during the year they won B2S, while only 1.3% of rural places did in 2023.

Another interesting finding — maybe to only us — was that 43% of rural communities that have won B2S awards have partnered with CORI during some phase of their journey. And those communities have a lower average Build to Scale Readiness Score relative to the rest of the rural winners.

Rural communities that have been successful in the Build to Scale process understand the importance of establishing strong foundational elements for a successful tech-based economy. They leverage their local assets — such as higher education institutions, public sector leadership, and cross-sector engagement — to grow their local economies. 

Through our work, CORI has seen that these elements are critical to rural tech-based economic development and showing commitment to further developing them is rewarded by Build to Scale.

Have questions about how your community can prepare to apply for Build to Scale?

This analysis isn’t meant to be prescriptive, or discourage any communities from trying to build their own tech ecosystem. CORI’s experts have worked with a broad range of rural communities to assess their tech-based economic development readiness and to submit successful Build to Scale applications.

Get in touch with our team today to better understand how your community can benefit from building a tech ecosystem and how to access funding to do so.

A note about our analysis

This analysis of Census-designated places uses CORI’s definition of rural to determine a community’s rurality, and requires that at least 50% of a place meet that definition to qualify. That resulted in more than 17,000 rural places across the U.S. that varied wildly in population and geography.

To better target rural communities that display key economic conditions, we then chose to focus on places with populations of 2,500 or more because communities any smaller than that tended to obscure the indicators we’ve attempted to measure. This threshold balanced the tradeoff between eliminating outliers while maintaining data reliability — including locations such as Plymouth, New Hampshire, and Williamstown, Massachusetts, that are home to thriving colleges and have promising Build to Scale Readiness Scores but are home to less than 5,000 people.