All Articles Tagged "sba"
Black Business Owners, Civil Rights Groups Support Marie Johns For Next Head Of The Small Business Association
Now that Karen Mills is stepping down as chief administrator of the Small Business Association (SBA), there’s an opening at the top of this important government agency. According to the Trice Edney News Wire (via the Florida Courier), “at least 80 Black business and civil rights organizations, representing nearly 30 million small businesses” sent a letter to the the Presidential Personnel Office advocating for the appointment of Marie Johns to the position.
Johns is currently deputy administrator of the agency, managing the agency and working on programs and policies for the agency. She was appointed to her position in June 2010 and, according to her bio, the “SBA had a record year in 2011, supporting more than $30 billion in lending to more than 60,000 small businesses across the country. That is the most capital going to small businesses in the history of the SBA.”
“Hope for the selection of Johns is said to be based on her established record of work for inclusion of Black and other minority-owned businesses, which have been hit hardest during the economic downturn,” writes Trice Edney. The wire says the National Bankers Association, the National Association for Black Veterans, and the National Urban League are among the organizations that signed on to the letter.
Mills will remain in her post until a successor is named. The SBA took on renewed importance during the Obama administration, re-gaining Cabinet-level status and stepping in to help small businesses in the wake of the Great Recession. According to USA Today, $106 billion has been lent to 193,000 small businesses since Mills became head of the agency. Click that link to read a Q&A with Mills and learn more about the agency.
African American entrepreneurship was the topic of a recent summit sponsored by the Small Business Association (SBA), the US Department of Education and the White House. As JohnathanHolifield, the co-founder of The America 21 Project and a participant at the summit acknowledges, “We need to create a thrust to complement existing entrepreneurship and small business leadership to ensure that African Americans as well as Latinos and others are connected to the innovation economy.”
According to the Washington Informer, the forum was moderated by Marie Johns, SBA’s Deputy Administrator.
“Our job at the SBA – which boasts 17 development centers on HBCU campuses across the country – is to ensure that innovative ideas and an entrepreneurial spirit can be harnessed, and then transformed into successful businesses,” she said at the forum.
HBCU representatives were central voices to the forum, including Bennett College President Julianne Malveaux as a panelist. Malveaux, who believes that African Americans were the original entrepreneurs in this country, revealed that Bennett College has been assisting with entrepreneurship over the past four years, with the construction of several of its new buildings. The construction of four of the campus’ buildings was a $21 million project in Greensboro, NC that meant economic opportunities for the area’s residents.
“One of the things that I insisted [on], was that the major contractor made sure 50 percent of the [sub-contractors] were people of color. . . [and] that’s the role we [currently] play” in creating black-owned and operated businesses,” he said.
Rutgers University has focused energies on a “Lemonade Day” in Newark, New Jersey. The project is aimed at helping children from kindergarten to age 12 understand entrepreneurship through developing a lemonade stand.
Meanwhile in Charlotte, NC, Ron Stodgill, the director of the Small Business Incubator/Think Tank on Johnson C. Smith’s campus, relays the group’s initiatives to reach businesses in their local area. Although the group is making strides, Stodgill acknowledges that the growth won’t happen overnight.
To that end, Holifield points out one of the black community’s greatest business weaknesses.
“We have in our communities and in our HBCUs, good programs and good support systems,” he said. “but we lack emphasis on explosive-growth for the kinds of companies that are responsible for the disproportionately high amount of jobs [created].”
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(Wall Street Journal) — Amid tougher lending standards and riskier times, a growing number of small-business borrowers are seeking federal government loan guarantees to loosen the purse strings at their local bank, according to SmartMoney’s latest Take Two profile of 50-plus entrepreneurs. With several weeks left in the fiscal year, the Small Business Administration’s two main lending programs have already surpassed arecord-high $18 billion in guaranteed loans issued through banks and other conventional lenders, agency data show. That’s more than double the full-year total in 2009. Depending on size, SBA loans are guaranteed for up to 85% against default. Like many borrowers, Alan Green, a former television news photographer who is the subject of this week’s profile, was initially turned down by three banks for a loan he needed to buy an ailing Molly Maid franchise in Salt Lake City. Yet after applying for an SBA 7(a) loan, Green, 59, had a check for more than $100,000 within a matter of weeks.
(Philadelphia Business Journal) — In most ways, a loan backed by the Small Business Administration is just like any other loan, and the process for getting one is much the same. The borrower applies to the bank, and the bank decides if he or she meets the criteria for credit. If the bank determines it cannot make the loan on its own, it may then look to an SBA program, most commonly the 7(a) guarantee program. If the SBA agrees, it will guarantee a portion of the credit, typically 75 percent or more. There are pros and cons for the borrower. Working with the SBA typically allows banks to offer rates and terms they may not otherwise be comfortable with. But there are also fees that range from 2 percent to 3.75 percent of the guaranteed portion of the loan, depending on loan size. For example, a $250,000 7(a) loan with a 75 percent guarantee would carry a $5,625 fee.
(The Root) — In a 2008 study sponsored by Radio One, Black America Today, the majority of participants between the ages of 18 and 30 said they wanted to be entrepreneurs. ”The hip-hop generation believes in education, but not … that you need a good education in order to get a good job,” Cathy Hughes, founder of Radio One, said at a recent White House reporters’ roundtable. “They want a good education in order to work for themselves and to start their own businesses.” Hughes, who was tapped last year to chair the U.S. Small Business Administration’s newly created Council on Underserved Communities, says that the latest initiatives from the agency are designed to help burgeoning minority entrepreneurs. The 20-member advisory council, which represents professionals from various backgrounds, including banking experts and economists, will provide recommendations on how the SBA can strengthen businesses in underserved communities, as well as communicate directly with aspiring and working business owners around the country.
(The State Journal) — Jamila Jones-Fleet saw an opportunity to provide creative IT solutions as a way to fulfill her entrepreneurial passion. She formed Innovative Solutions Technology in 2007. More than three years later, her company is now a prime contractor to a handful of federal agencies and large companies including General Dynamics, SAIC and Caprock, focusing on data storage management and design. Jones-Fleet used her experiences and success as a minority business owner to help guide others. Her dedication to that cause is why Rick Haney, public information officer with the West Virginia office of the U.S. Small Business Administration said she was selected for a state SBA award this year.
(Wall Street Journal) — As Democrats and Republicans remain in gridlock over the federal budget, some business owners are wondering how they will be affected if agencies run out of funding and the government shuts down. Small firms that use government programs or work with government agencies may be impacted in several ways, according to a Small Business Administration official. Here’s the breakdown: There won’t be any new approvals of SBA-backed loans, such as 7(a) or 504 loans. Even though banks and other private lenders underwrite these, the loans also must get approved by the agency before they can be fully processed. That can’t happen without funding. The real backlog will start midnight Friday. Applications that are submitted after that time will be queued up for approval until there’s more funding.
(AJC) — The Small Business Administration Georgia District Office is taking applications for its fourth management training class for small businesses under its Emerging 200 program. The executive-level training program has been expanded to all areas of Atlanta, with the goal being to help promising small businesses step up to the next level.
(Businessweek) — Small business owners have long complained about the red tape, long waits, and prohibitive collateral requirements of Small Business Administration-guaranteed loans. This spring the agency will introduce two new SBA loan programs that will funnel capital to underserved entrepreneurs directly through nonprofit microfinance organizations, says Grady Hedgespeth, director of the SBA’s Office of Financial Assistance in Washington, D.C. He spoke recently to Smart Answerscolumnist Karen E. Klein about the two new loans, as well as the brand-new 504 commercial mortgage refinance program and how they work. Edited excerpts of their conversation follow.
Karen E. Klein: What new loan programs is the SBA adding to its portfolio for 2011?
Grady Hedgespeth: The most exciting are our Community Advantage and Small Loan Advantage programs. They are a simpler and easier way for lenders to make smaller-dollar loans and get a full SBA guarantee of up to 85 percent.
(New York Times) — Back in April, The Agenda reported on a lawsuit against the Small Business Administration, brought by a would-be venture capitalist seeking access to government-backed investment funds. The S.B.A. recently reached a settlement — actually, it was in November, but I’ve been on paternity leave (twins!) — with Diamond Ventures, an Atlanta-based fund run by C. Earl Peek, an African-American who claimed discrimination after the S.B.A. rejected Diamond’s application for a small-business investment company license. But while the settlement is good news for Mr. Peek and his partners, it does not address what Diamond claimed was a far-reaching pattern of bias that affected a whole class of black and other minority investors.