Since time immemorial, becoming an entrepreneur meant surmounting steep obstacles.

Getting off the ground took technical know-how and lots of it, not to mention substantial startup capital or financial backing. Staying afloat meant having access to elite and amenable networks. Those contemplating an e-commerce venture would likely need skilled coders, computing equipment and office space – requirements that easily run into hundreds of thousands of dollars in overheads.

But all of this may be about to change.

A new study by Bryan Stroube of the University of Kentucky and London Business School Professor, Gary Dushnitsky, finds that new technologies—so-called low-code tools or platforms like Shopify—are poised to reshape the playing field, effectively democratizing access to entrepreneurship.

For aspiring, everyday entrepreneurs, these new generation, easy-to-use platforms are opening the door to scalable online ventures: new businesses that can be launched from virtually anywhere in the US, for just a few hundred dollars, and zero knowledge of coding.

And the greatest beneficiaries of this shakeup are likely to be historically underrepresented groups—those who might hitherto have had least access to the opportunities of entrepreneurship, such as Black Americans.

So, what’s happening and how might it impact the future of business and society?

Low-code tools: What they are and why they matter

Technical innovation has paved the way for Shopify and other low-code tools that eliminate the need for coding expertise—and hiring coders. Shopify and other common low-code e-commerce enablers such as Wix and BigCommerce allow their users to build fully functional websites and digital storefronts using drag-and-drop tools very much like a kind of digital Lego for business: all the requisite parts, from payment systems to inventory tracking to mobile responsiveness simply snap together to form a whole, without the need for a single line of code.

These platforms offer three game-changing benefits to aspiring entrepreneurs:

  • No need to hire in tech expertise: Anyone with a good idea and basic digital skills can build a robust and functioning business infrastructure.

  • Accessible costs: Shopify and other low-cost tools offer packages from less than $50 per month. Some entrepreneurs in the study began with as little as £200 – less than $250 in outlay.

  • Scalability built-in: These tools are designed to grow in tandem with the businesses they house. Whether it’s selling to the neighbourhood or shipping internationally, the same platform can support and help accelerate expansion.

And Shopify et al are gaining monumental traction. According to one analyst site, the low-code platform market is expected to grow from $37 billion to $264 billion between 2015 and 2032, a function of their growing appeal to users with limited funds and resources. Shopify alone currently accounts for roughly 10% of the worldwide e-commerce software space.

As Aaron Levie, CEO of cloud platform Box puts it: “I have a friend who sells balloons online… I don’t think he would have started the business if Shopify didn’t exist.”

New tech, new entrepreneurs

Technology is bringing unprecedented access to instant application, low-cost development platforms. But who is exploiting this new opportunity the most?

To glean some sense of the impact among different demographic groups of prospective entrepreneurs, Stroube and Dushnitsky put together a massive dataset of more than 160,000 Shopify-powered businesses across a total of 32,000 US neighbourhoods.

Using web-technology search engine BuiltWith to parse the data, they were able to pinpoint those areas registering the highest numbers of active Shopify-powered ventures. When they crunched this data together with demographic information from the Census American Community Surveys (covering neighbourhoods by total population, by Black or African American population, by those individuals with bachelor’s degree and those who had been below the poverty line in the last 12 months) Stroube and Dushnitsky found something striking.

Neighbourhoods with higher Black populations have significantly more Shopify-based ventures than others. Specifically, those areas with an uptick of 1% in the prevalence of Black residents see a concomitant uptick of 3% in Shopify-powered businesses.

“We find a direct tie between the proliferation of new ventures housed cheaply, quickly and effectively on Shopify and the proportion of Black households in these neighbourhoods—neighbourhoods which include rural regions and areas that have traditionally seen very little entrepreneurial activity. And what’s more we’re seeing these new ventures appear all over the USA,” says Dushnitsky.

“And this is in sharp contrast to the historical patterns, where entrepreneurship has been heavily concentrated in parts of the US rich in financial, social and human capital – think Silicon Valley or other affluent urban centres.”

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