Thursday, February 5, 2009

SBA Bashing

So here is the deal with the SBA (Small Business Administration): a little over a year ago, this was the government source for start-up and small business funding. A year ago, Saus probably could have swindled the SBA for a loan. It's not that there is something particularly special about the agency -- it's basically a glorified bank -- in fact, it teams with banks to provide loans to entrepreneurs at a Federal interest rate....a little over a year ago, that is.

If you are an entrepreneur trying to obtain seed money at this time, your efforts to do so through the SBA might be futile. Recently, I met with the resident food service expert at the SBA and dragged our adviser along in case there was a glimmer of hope for a financing option. We soon discovered there was not. The banks have more financial jurisdiction than even our own government in that due to their loan terms for small businesses (that is, in order to secure a loan, must have been in business 2+ years), the SBA consequently was disabled from its lending. Simply, the banks control everything. The 7(a), which is the SBA's general business loan, was down 40% from last year. The good news, however, is that in 2008 the SBA was able to lend to some of the largest companies in the United States (Lockheed Martin, Dell, etc.) -- do these sound like small businesses to you? In fact, 1/6 of the money doled out by SBA went to the top 10 largest firms in the US.

Let's just hope for all the job creators of the future that the banks, followed by the SBA, begin lending to small businesses again.

So to add humor to this dark and dismal landscape, I have included an online conversation I had with our adviser about the SBA:

Adviser: We should rename the SBA from Small Business Administration to something more appropriate
Like No Start-Up Loans (NSL) or No Jobs Here (NJH)...
Sent at 8:34 PM on Tuesday
Me: Shouldn't Be Agency
Adviser: Ha Ha, yes I could not think of anything good for SBA
You are a quick wit you.
Me: not really, my quick wit would originally have said, Shit Bagger Association
Adviser: Har Har.
Small Business Anti-Christ
Another pot of gold for the shameful business advocates (aka lobbyists)
Sent at 8:38 PM on Tuesday
Me: haha
Small Business Annihilator
Adviser: ha ha okay you win
Me: i think ill cut and copy this conversation onto the blog

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