The Small Business Administration (SBA) believes “giving small employers a voice early in the process is key to reducing the negative impact of regulations on small businesses, increasing the level of regulatory compliance, and passing on cost savings to state economies. Regional Advocates help identify regulatory concerns of small business by monitoring the impact of federal and state policies at the grassroots level,” according to sba.gov.
According to Marilyn Geroux, District Director of Maine’s SBA, a small business is considered any business that employees less than 500 people. “Actually, around 97% of Maine businesses qualify,” Geroux states.
Last year, Maine’s SBA helped over 400 small business owners. “Last year alone, we leveraged 110 million dollars into the Maine economy,” Geroux says.
SBA offers three financial programs for small business owners. The first is a Guaranteed Loan Program, or debt financing. According to Geroux, “We don’t hand out the loans, we are actually a guarantee lender. This means we guarantee bank loans. The business owners work with the bank, and we just guarantee the bank that their loans will be paid back.” In other words, SBA sets the guidelines for loans, which are then made by its partners. SBA then guarantees that the loans will be repaid, thus eliminating some of the risk to the lending partners.
The second financial program is a Bonding Program, or surety bonds. This helps small business contractors who cannot obtain surety bonds through regular commercial channels. According to sba.gov, “Through the SBG Program, the SBA makes an agreement with a surety guaranteeing that SBA will assume a percentage of loss in the event the contractor should breach the terms of the contract. The SBA’s guarantee gives sureties an incentive to provide bonding for eligible contractors, thereby strengthening a contractor’s ability to obtain bonding and greater access to contracting opportunities for small businesses. SBA can guarantee bonds for contracts up to $5 million, covering bid, performance and payment bonds, and in some cases up to $10 million for certain contracts.”
The third is a Venture Capital Program. “SBA’s Small Business Investment Company (SBIC) Program is a public-private investment partnership created to help fill the gap between the availability of growth capital and the needs of small businesses. The SBA does not invest directly in small businesses, relying instead on the expertise of qualified private investment funds. The SBA licenses these funds as SBICs and supplements the capital they raise from private investors with access to low-cost, government-guaranteed debt,” according to sba.gov.
SBA also offers counseling through three primary channels, SCORE, Small Business Development Center, and Women’s Business Center business counselors. “This is the best aspect of SBA, along with providing access to capital through our loan guaranty programs,” Geroux says. “Counseling through our Resource Partners is free, confidential and there is no time limit. Our counselors help with a wide array of issues such as helping prepare business plans, providing social media assistance, and even marketing.”
Helping small business owners find a business mentor through the Mentor/Protegee program is another service SBA offers. According to Geroux, SBA doesn’t set small business owners up with a mentor, but they do approve the mentor partnership. “This is really important because many companies grow too fast or, have trouble getting to the next level, but the mentor/protegee relationship can help with that,” she states.
“We are always looking to help companies export as well,” Geroux says. “We also want to appeal to young entrepreneurs. We want to help them start up a business in Maine and stay here.”
Geroux wants to remind small business owners that the most important thing about SBA is that they are here for you. “We are here for them as long as they need us through the life cycle of their SBA Guaranteed loan and through the life cycle of their business. We don’t disappear once they get the loan, and we offer much more than just our guaranteed loan programs. Our phones are always ringing and we are always here to help.”