LA’s online business portal slashes red tape for local entrepreneurs
Other US cities have taken the code to make their own
The LA Innovation Team has designed a sleek and accessible online business portal that greatly simplifies the process of starting a business in the city. It was built after consultation with local entrepreneurs and the government agencies they interact with, and it aims to cut the average time required to set up a business from six days to one. Over its first 10 months, it drew over 60,000 unique users, and several other US cities are currently in the process of using the code to build their own portals.
Results & Impact
In its first 10 months, the LA Business Portal has drawn over 60,000 unique users. The code is open-source, and four other US cities, including Nashville and Minneapolis, are in the process of using it to build their own business portals. Research by the White House Small Business Administration found that the average time spent doing the paperwork to set up a business was six days; the LA Business Portal is part of an initiative to cut that down to a single day.
Key Parties
LA Innovation Team, White House Small Business Administration, the LA Mayor’s Office, 10 departments across the City and County of LA, and the City of San Francisco
How
The LA Innovation Team spoke to local businesses owners to understand the experience of setting up a business. They then spoke to the relevant agencies involved at the city, county, state and federal levels of government to figure out how the process of communicating with them and applying for permits could be simplified. The design of the portal was inspired by these consultations. It has four sections, telling you how to plan, start, manage and grow a business. When users visit the portal for the first time, they are asked a series of straightforward questions about their venture. They then receive a roadmap directing them through the entire startup process, from location scouting to acquiring permits and accessing capital. Another function of the platform is business-to-business communication: it encourages owners of similar businesses to share their experiences and knowledge.
Where
Los Angeles
Target Group
Entrepreneurs
Cost & Value
Los Angeles created the platform with a $250,000 grant from the White House Small Business Administration.
Stage
Running since September 2016
Hurdles
Thinking through all the levels of administration - city, county, state and federal - was complex. Communicating the idea of the portal to government agencies and prospective users was also a challenge. Although it’s now up and running, some important data is lacking: the tracking data that would indicate whether user activity on the platform is converting into businesses formed and thriving. Acquiring that will be essential to demonstrating impact. A potential challenge for replication is that many cities do not build their platform on open-source software.
Replication
A stipulation of the grant was that the platform be open-source. Now four US cities, including Nashville and Jerusalem, are in the process of building their own business portals.
The Story
The city of Los Angeles has designed an online business portal to help entrepreneurs navigate the bureaucracy of setting up a small business. In its first 10 months, it drew over 60,000 unique users.
The LA Business Portal is divided into four sections, telling you how to plan, start, manage and, lastly, grow a business. Each section distils both business advice and the legal essentials in a straightforward way.
It was designed by the LA Innovation Team, one of numerous city teams founded by Bloomberg Philanthropies, after consultation with local business owners and the numerous agencies they must interact with.
“We spent a lot of time talking to businesses and asking them what they wanted to see from the city,” said Amanda Daflos, Director of the LA Innovation Team. “What we wound up with was: people want resources that make it clearer how to do business in our city.”
When users first visit the portal they answer a series of simple questions about their venture, and are then given a bespoke roadmap that guides them through the whole startup process. This takes them through, among other things, location scouting, license permitting and accessing capital.
One of the most important things was to make it very accessible and intuitive to use.
“The portal looks very different from other city websites: it’s user-friendly,” said Daflos. “We wanted people to have a pleasant experience using it. We focused on bright colours, iconography and making sure we had a consistent brand throughout the site. We also wanted to highlight local businesses, so as you navigate the site you see photos from them.”
“Another thing that’s very important in Los Angeles is the translation element,” Daflos added. “A lot of languages are spoken here, Spanish being the most prominent. As so many of our businesses have Spanish as their primary language, we had someone translate the entire site.”
They paid careful attention to the complexity of the language, too. Initially, the language was at 12th-grade level, but after user testing, they changed it to a 7th-grade level.
“We made sure our content was written in a very accessible way because we wanted all of our users to be able to understand sometimes complicated city rules,” said Daflos.
Any small business has to navigate regulations in many jurisdictions: the city, the county, the state and the federal. And within each level of government, there are multiple agencies they need to interact with. Keeping things simple is the best way to keep things inclusive, particularly as more than 80% of businesses in LA have under 20 employees—those aren’t the sort of companies that have money to pay someone to interpret legalese for them.
The LA Innovation Team was tasked to create the platform when the city was awarded a $250,000 grant by the Small Business Administration as part of its “Start Up in a Day” initiative. This competition was intended to help cities simplify the red tape faced by small businesses such that they can complete all necessary paperwork in a single day.
The grant came on the condition that the code for the platform be open-source, because the portal is intended to be replicable in other cities.
“There are four or so cities that we know of, including Nashville, who are taking the code and trying to model their own platforms after ours,” said Daflos. “We view that as a victory: it’s good enough to copy.”
“As a Drupal [open-source software] system one of the challenges that we face right now is that many cities don’t build their web platforms with Drupal, or with open-source in mind,” said Daflos. “So some cities that want to make a business platform are in the process of building new servers. But we at the Innovation Team are always happy to jump on the line and help them out.”
In time, further elements will be added. For one, tracking data that allows them to see whether users and activity on the platform convert into licensed and successful businesses. And one day, the platform may also include the capacity for small businesses to make transactions online.
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