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Ask The Small Business Professor?

Dear Professor Bruce:

I feel stagnant in my current job. It’s a road to nowhere. I am talented in my field and have some excellent background. Money is what I would need to really get going in my own business. Are there government programs available to help me?

Answer:

The U.S. Small Business Administration (SBA) has a number of loan programs for small businesses unable to secure financing on reasonable terms through normal lending channels. According to SBA spokesman, Mike Stamler, “the SBA approved a record 105,094 loans to small business owners for $20.2 billion, nationwide.. The number of loan approvals to small business owners rose 17 percent in 2005, and 2006 promises to be even better.”

The majority of small business owners obtain financing under SBA’s 7(a) loan program. These loans are made through private-sector lenders and are partially guaranteed by the SBA. Many of today’s SBA loans are approved within 36 hours through the expedited approval programs we have established for our lending partners. Most lenders participate in SBA’s programs and interested applicants should contact a local SBA lender for a loan application or information.

The vast majority of businesses are eligible for financial assistance from the SBA. However, the business must operate for profit; be engaged in, or propose to do business in, the United States or its possessions; have reasonable equity to invest and use alternative financial resources first, including personal assets Please note that the SBA does not lend money directly nor does it provide grants.

The proceeds of SBA loans can be used for most business purposes. These may include the purchase of real estate to house the business; construction, renovation or leasehold improvements; acquisition of furniture, fixtures, machinery, and equipment; purchase of inventory; and working capital.

Small business owners and start-up companies can obtain free business counseling from SCORE – “Counselors to America’s Small Business” and the network of Small Business Development Centers (SBDCs) conveniently located throughout the country. Both groups also conduct training courses on a large variety of business topics for modest fees and their services are an excellent starting point for those interested in starting or expanding a small business.

The SBA also funds the Women’s Business Center (WBC) to provide women entrepreneurs with training, counseling, mentoring and access to SBA programs. Areas of assistance and training include finance, management, marketing, procurement, as well as specialized topics such as home based businesses