As small businesses continue to navigate the COVID-19 pandemic, there are a few silver linings to celebrate. Prior to 2020, new business formation had been declining over the past few decades, according to the Department of Commerce. However, during the pandemic, this decline reversed with the creation of booming new businesses. Additionally, the businesses that have been created in the past two years are projected to have a high propensity for growth.
At CO—’s 2021 Big Week for Small Business, Neil Bradley, executive vice president and chief policy officer of the U.S. Chamber of Commerce, spoke to the administrator of the Small Business Administration (SBA), the Honorable Isabella Casillas Guzman, about how small businesses can continue to grow with the help of organizations like the SBA.
Innovative solutions are needed for access to capital
Many small businesses are suffering from opportunity gaps that cause them to have less access to capital. These businesses are unable to reach their full potential and contribute to the growing economy, said Guzman.
“We know that businesses need support [with] capital because they're trying to seek opportunities and grow,” she said. “And so [the SBA is] envisioning how we can de-risk investments in small businesses so that more can access capital.”
For small businesses to gain access to this capital, there needs to be innovative and creative solutions. The SBA has a number of tools to assist small businesses in finding lenders and banking partners that can keep them from having to rely on credit cards or loans from family and friends. The number of lenders in partnership with the SBA has grown to upwards of 5,000 from 2,000 lenders before the pandemic began, said Guzman.
“We're looking at direct lending for loans under $150,000, where a lot of businesses get their start, or working capital loans through a direct program as well,” she added.
[Read more: 50 Grants, Loans and Programs to Benefit Your Small Business]
We know that businesses need support [with] capital because they're trying to seek opportunities and grow.
The Honorable Isabella Casillas Guzman, administrator, Small Business Association
Technology and e-commerce accessibility project growth
Guzman noted that one of the main goals for the SBA is helping more small businesses gain access to technology and e-commerce platforms. This involves making sure underserved communities and zip codes have additional opportunities to take advantage of technical assistance for their businesses and startups.
“E-commerce and technology adoption was a silver lining during this pandemic because growth in the future is going to veer towards e-commerce,” explained Guzman. “We want to make sure our businesses can leverage that growth.”
Small businesses have also had to learn new technical skills, such as connecting with consumers over social media and brushing up on cybersecurity knowledge. The SBA is hoping to keep these skills accessible with free or low-cost advisory services across their networks and available to small businesses.
“We've all had to learn different skills in terms of connecting with our clients,” said Guzman. “These skill sets are something that we want to lean into. If you're going to be online, we want to make sure you're secure.”
[Read more: How to Decide What Tech to Invest In]
Legislation and SBA resources hold opportunities for small businesses
Guzman detailed how the Build Back Better Agenda put forward by the Biden-Harris administration is hoping to help small businesses have better access to capital, increased job creation and open market opportunities.
“That’s what's envisioned in Build Back Better: the capital and the market opportunities [as well as] these networks that will continue to build up stronger ecosystems,” said Guzman. “And we know that the [individual] chambers will be a key part of making sure that we're connecting all of them.”
It’s also important as a small business to ask for help when they’re first starting out. Guzman stressed that entrepreneurs need the assistance of resource partners and advisors to assist them in scaling their business.
“You wear so many hats as an entrepreneur out there,” she said. “Making sure that you supplement your skill set with others who are offering the services … is so important.”
[Read more: 7 Tasks Small Businesses Can Outsource]
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