Ask most entrepreneurs how the Small Business Administration helps them, and their first response will likely involve SBA loans. But the SBA offers a wide array of resources to help small business owners with virtually every aspect of starting and running a business.
A survey of SBA assistance starts with financing. The SBA doesn’t actually directly lend money to small businesses. Instead, the agency guarantees loans made by banks and other financial institutions through several programs.
7(a) loan program: This is the SBA’s biggest loan program, providing government-backed loans to startups and existing businesses through commercial lenders. The program includes the four following subtypes.
- Express loans: This program offers borrowers expedited turnaround on applications — in as few as 36 hours.
- Export loans: These loans are intended to help small exporters improve or expand their export business.
- Rural lender program: Lenders in small towns and rural areas can use simplified loan applications in this program that’s meant to help smaller communities.
- Special purpose loans: Businesses that have been affected by NAFTA, have employee stock ownership plans, or need help putting pollution controls in place can tap this program.
CDC/504 loans: Private, nonprofit certified development companies provide long-term, fixed-rate loans to small businesses that want to acquire real estate or capital equipment.
Microloans: Small companies and nonprofit childcare centers can get short-term loans of up to $35,000 for working capital, inventory, supplies, fixtures, machinery, and equipment.
Disaster assistance loans: Businesses as well as individual homeowners and renters can get help to repair or replace real estate and other personal or business assets damaged by disasters.
Other SBA financial assistance programs include:
Surety bonds: Contractors that can’t get surety bonds from commercial sources can get help from this SBA program.
Small business investment companies (SBICs): These privately owned venture capitalists can borrow from the SBA to provide equity or debt financing to qualified small firms.
Help with Government Contracts
The SBA offers significant resources for small businesses that want to enter the world of government contracting. It helps prospective contractors understand the process, get qualified, and find and pursue opportunities.
Among the SBA’s contracting help is a guide to registering your company in the Central Contractor Registration database of prospective vendors. This is a necessary first step if you decide federal contracting is for you.
SBA also runs a network, SUB-Net, just for companies that want to pursue subcontracting opportunities with the federal government.
Counseling and Assistance Programs
The SBA’s counseling and assistance resources provide small businesses with information, education, and technical help through several major programs.
SCORE: The Service Corps of Retired Executives connects knowledge-hungry entrepreneurs with veteran businesspeople who can serve as mentors to help small businesses with almost any problem.
Small Business Development Centers: Through a network of more than 1,000 service locations, this program gives entrepreneurs education, advice, and assistance in managing businesses.
Women’s Business Centers: More than 100 of these SBA offices help disadvantaged women and other entrepreneurs with education, training, counseling, and technical assistance.
Small Business Training Network: You don’t have to go farther than your nearest Internet connection to take advantage of the SBA’s Small Business Training Network, a free online educational resource that informs entrepreneurs about topics from accounting to advertising in self-paced, half-hour courses.
Finally, while entrepreneurs don’t have as much direct contact with it as some other programs, the SBA’s Office of Advocacy plays a vital role in representing small business interests to federal legislators and regulators. Among its stated goals are reducing undue regulatory burdens and other worries on small companies and conducting research verifying the positive impact of small businesses.
Mark Henricks writes about business, technology, personal finance, and other topics from Austin, Texas. His work has appeared in The Wall Street Journal, Entrepreneur magazine, The Washington Post, and other leading publications.