Clusters Initiative

About SBA

Clusters Initiative

The U.S. Small Business Administration is investing in regional clusters throughout the US that span a variety of industries, ranging from energy and manufacturing to agriculture and advanced defense technologies.

Clusters are geographic concentrations of interconnected companies, specialized suppliers, academic institutions, service providers and associated organizations with a specific industry focus. They provide high-value, targeted connecting of small and large businesses, including networking with potential industry partners abroad.

Clusters form strong partnerships between universities and private industry, facilitating technology transfer and commercialization of new technology. Clusters can play a critical role in meeting innovation needs in sectors such as energy or defense faster and cheaper than traditional procurement processes.

The map below shows the names and locations of the more than 40 clusters in which SBA is investing, the majority of which represent a collaborative funding opportunity among several Federal agencies. A list of the clusters can be found here. Small businesses interested in participating in a cluster can also refer to the map below for more information about a cluster's area of focus and the region in which it is concentrating its efforts.

SBA Invests in Over 40 Clusters

In the fall of 2010, SBA funded its initial three clusters in collaboration with the Department of Commerce, the Department of Energy, the Environmental Protection Agency, and several other agencies. These clusters are located in the Greater Philadelphia region, Florida, and Ohio. Read more

SBA Supports Clusters Across the US Learn more

Evaluation

Year One Data Study of the Pilot Clusters Initiative

SBA funded a third-party evaluator to examine the ten pilot clusters in detail, including their various stakeholder participants and the services and activities provided by the clusters, with a focus on small business participants. The report, published in June 2012, evaluates the initial outcomes observed during the first year of the initiative, including the employment, revenue, and payroll of the small businesses as well as their ability to spur innovation and obtain financing. Furthermore, the report analyzes the regional economic impact of the economic activity of the clusters’ small business participants.

Key pilot findings and outcomes from Year One include:

Total small business participation in the 10 clusters grew by over 275% in one year. Small business participants grew from 179 at the start of the pilot to 672 at the end of the first year.
Top reasons for small business participation in the clusters: networking with other SBs (82%); access to new markets (domestic and international) (50%); access to cluster services (49%); access to government procurement opportunities (49%); and integration in the industry's supply chain (45%).
Over 85% of the small businesses surveyed reported that the services and activities provided by the cluster were unique and could not be found elsewhere.
The more established clusters allocate more funding to providing services and engagement activities. The study found that clusters three years or older allocated the majority of their SBA funding to providing services to their members as contrasted with overall cluster management and administration.
On average, total employment grew by 11.2% in the small businesses that participated in the clusters, including both full-time and part-time employees. This includes a 7.6% increase of full-time employees.
Nearly all of the clusters involved in the initiative - 9 out of 10 - experienced an increase in the average revenue of small business participants during year one. On average, the revenue of small business participants increased by 13.7%.
The average payroll (total compensation paid to employees) of small business participants increased in year one by 23.4%.
Over two thirds (69%) of small businesses that sought cluster services reported that they developed new products or services. More than half (54%) reported being able to commercialize new technology.
Clusters helped small businesses enhance economic activity.
- Access to capital as reported by the Cluster Administrators: Nearly $48 million in capital through private funding sources such as venture capital and angel capital. Over $6.5 million in early stage investment from federal Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) awards.
- Access to markets as reported by Cluster Administrators: Over $217 million contracts or subcontracts awarded to small business participants.

Click here to download the five-page Executive Summary of the report. To download a PDF of the full report click here.

Federal Collaborators

Resources

Clusters FAQs

Payment and Invoicing 2011 Jobs Accelerator and Innovation Challenge SBA 7(j) Grant Recipients and the 2012 Advanced Manufacturing SBA 7(j) Grant Recipients. Click here to view FAQs.