It's time to replace the SBA with a True SBA for small businesses
by chuckblakeman, Window Shopper
- Created: November 21, 2009, 12:34 am
The SBA is supposed to serve all businesses with under 500 employees. This constitutes 99.7% of all businesses. Only 17,000 businesses in the entire US fall outside of the SBA, with 28 million falling inside. A constituency from 1 to 500 employees is so broad as to be meaningless, and no agency could successfully serve such a ridiculously broad group. To call 99.7% of all businesses small is no different than saying everyone under 7' tall is 'short'.
Everything in the SBAs history points to the obvious - they exist to serve businesses over 100 employees, with an occasional nod to businesses w/ over 50 employees, and virtually no help for true small businesses under 20 employees. The loan programs and the entire structure of the organization is focused on these mid to large size businesses masquerading as small.
A classic example - Obama's most recent 'solution' to the lending crisis to true small businesses under 20 employees was to raise the lending limits on 7(a) loans from $2 million to $5million. Please tell me how raising the limits on loans a true small business will never qualify for could possibly offer any relief whatsover. Who does this help? Businesses with 50 to 500 employees will beneift greatly. True small businesses will be left in the lurch once again.
SCORE is supposed to be an aide to true small businesses. The overwhelming number of SCORE counselors are retirees from middle management in big businesses who never started a business in their life. They use their big business experience to advise people on things they themselves have never done (crunching the numbers for a 2 person business is an entirely different thing than for a 75 person business - until you've started and bootstrapped a business, you shouldn't be telling others how to do it.)
It's time for change you can believe in. The SBA is not only ineffective, but as a strong supporter of businesses from 50-500, the SBA has for 50 years made it easier for those businesses to succeed at pulling market share away from true small businesses. The SBA is responsible for an ongoing deleterious effect on true small business.
It is time to call for the creation of a true small business administration and a recognition that the existing one should be renamed and repositioned as the MSBA - Mid-sized Business Administration.
Over the next three years, beginning immediately, we are recruiting support for the formation of this new administration that separates the 90% of all businesses in America with under 20 employees out and away from the mid to large sized businesses that have been the real focus of the SBA for over 50 years.
Please join us in the conversation. What should this new agency provide for true small businesses? How should it interact with them. What would be the metrics for measuring its success?
We look forward to your involvement in bringing the true SBA to life and the repositioning of the existing one as the Mid-sized Business Administration.
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