Making Government Smarter, More Innovative and More Efficient for America’s Entrepreneurs
by Karen Mills, Former SBA Administrator
- Created: July 17, 2013, 4:28 pm
- Updated: July 17, 2013, 4:28 pm
America’s 28 million small business owners drive job creation and innovation across our economy. They are responsible for creating two out of three net new private sector jobs in our communities. Many of these businesses start with shoestring budgets and small staffs of dedicated people looking to transform their industries. These men and women work hard. They sacrifice. And the last thing they have time for is bureaucracy, piles of unnecessary paperwork and navigating byzantine processes that waste time, money and resources. They have businesses to run.
Last week, President Obama announced a second-term management agenda designed to make interacting with the government easier for these businesses. The goal is to ensure that government is a trusted partner and a catalyst for helping these entrepreneurs to grow and succeed. This agenda builds on a successful four-and-a-half-year effort to make government more efficient, more transparent and more accountable.
At the U.S. Small Business Administration (SBA), we are doing this by harnessing technology, breaking down bureaucracy and making our programs more streamlined and responsive. Our goal is to create tools that allow small businesses to punch above their weight.
We have eliminated more than 100 pages of paperwork from some of our loan products and launched simplified products to address the working capital needs of small businesses and better fill gaps for small dollar loans. This helped to fuel record years for SBA lending in 2011 and 2012.
For example, we created a simpler application process for our Small Loan Advantage program, the flagship 7(a) product for loans under $350,000, which we call SLA 2.0. Since these changes, we’ve seen a threefold increase in participating lenders and a more than 280 percent increase in the number of loans provided.
We also know that high growth businesses, particularly those located outside of traditional start-up hubs, often struggle to get the investment capital they need to turn great ideas into viable and successful businesses. These businesses are critical to job creation and innovation across key sectors of our economy.
At the SBA, we run a program called the Small Business Investment Company (SBIC) program. This program is authorized to invest up to $3 billion annually in funds that invest in high growth businesses. In the past, this program was too cumbersome and underutilized. We fixed that. We reduced the processing times to license new SBIC funds to under five-and-a-half months from about 15 months in 2009. In fact, SBIC funds that are eligible for SBA's new fast track process often get licensed in as little as two months. Today, this streamlined program is operating as a model public-private partnership and it had its third consecutive record-breaking year in 2012. Investment funds licensed as SBICs provided more than $3 billion in growth capital to over 1,000 small businesses, a 17 percent increase from FY 2011 and an 83 percent increase from FY 2010.
We also know that small business owners don’t have the time or the resources to be spending all day on the phone or on the computer trying to navigate various government programs. That’s why the Administration launched BusinessUSA, a one-stop shop for accessing business-related programs across the Federal government.
Our goal is to ensure that small business have the tools they need to be globally competitive. Small business owners want to access new markets, including overseas export opportunities, and to be able to tap into important commercial and government supply chains. However, many of these businesses don’t have the manpower or the resources to research and go after these opportunities.
We are changing that. We recently launched a multi-agency pilot called U.S. Global Business Solutions. It combines trade finance loans, export insurance and marketing support that were previously delivered across a variety of government agencies into one streamlined package of products. We will have a full scale roll-out of Global Business Solutions in January 2014 to our entire lending portfolio.
We also launched the American Supplier Initiative. The goal of this initiative is to help small businesses more easily connect to both government and commercial supply chain opportunities. As part of these efforts, we are hosting matchmaking events and providing specialized tools and programs to ensure that small businesses have what they need to be successful suppliers.
In addition, we are using technology to break down barriers that prevent small businesses from winning commercial and government contracts. For example, we worked with the IBM Foundation on Supplier Connection, a portal that makes it easy for a small business to quickly connect with the right procurement people at hundreds of large corporations across the country. And we launched RFP-EZ, an online marketplace that streamlines the government contracting process, making it simpler for small businesses to find and bid on low-dollar contracts from federal agencies. It also lowers the cost of technology services, saving taxpayer money.
RFP-EZ was built by the Presidential Innovation Fellows’ Entrepreneurs-in-Residence at the SBA. These men and women know what entrepreneurs need and the format they need it. And we are going to use these entrepreneurs, and continue to solicit the advice of entrepreneurs around the country, to help us to streamline and improve programs across the Agency, including how we can better use data to create supply chain opportunities for small businesses.
The goal of all of these efforts at the SBA, and across the Administration, is to make sure that we deliver, as the President said, “the kind of 21st century government the American people want.” By doing this, we are ensuring that America’s entrepreneurs and small business owners have the tools, the resources and the business environment they need to do what they do best: create innovative new products that drive job creation and accelerate our economic growth.
About the Author
Karen Gordon Mills is the Former Administrator of the U.S. Small Business Administration. The SBA helps both Main Street and high-growth small businesses get access to capital, counseling, federal contracts, disaster assistance and more.
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