What Is the SBA?
Though it was officially created in 1953, the ideas behind the SBA began to swirl years earlier in the form of other agencies — predominantly as a response to global economic disruptors like the Great Depression and World War II. For example, President Herbert Hoover’s Reconstruction Finance Corporation, a lending program for businesses hurt by the Depression, is considered a “grandparent” to the SBA.
Over time, beliefs evolved from considering the main cause of business failure to be lack of information and expertise to recognizing the fact that smaller companies find it more difficult to win contracts against bigger, well-established rivals. These shifts in thinking funneled into the agency where President Dwight Eisenhower eventually proposed a solution: the Small Business Administration.
The function of this agency, according to a history of the organization, was to:
“aid, counsel, assist and protect, insofar as possible, the interests of small business concerns … the charter also stipulated that SBA would ensure small businesses a ‘fair proportion’; of government contracts and sales surplus property.”
Thus, information and opportunity form the crux of the SBA’s resources and services. Today, the SBA has grown to include federal and financial contract procurement assistance, management assistance, in addition to specialized outreach to minorities, women business owners, and veterans.
To achieve its goal of supporting small businesses — and minority-owned businesses in particular — the SBA offers an extremely diverse array of services which can be broken up into the following categories:
One of the SBA’s key goals is to provide small businesses with the capital they need to launch or grow. This is done primarily through the SBA’s funding programs, which include loans, investment capital, disaster assistance, security bonds, and grants. The SBA works with lending partners to provide loans ranging from $500 to $5.5 million. Funds can be used for most business purposes, such as long-term fixed assets and operating capital.
In addition to its support with loans, the SBA helps businesses with investment capital by connecting them with investors who make both debt and equity investments. The SBA can also put businesses in touch with a number of government grants that support those doing scientific research and development.
The SBA has a number of resources dedicated to entrepreneurial development. Online, you can benefit from educational resources such as business guides covering multiple topics to help you achieve your company goals:
The SBA also has an online learning center where you can find a variety of online courses that will help you start and run your business.
There are also in-person resources to support entrepreneurial development. For example, the SBA works with a number of local partners to counsel, mentor, and train small businesses. You can take advantage of the SBA’s free counseling services by using the local assistance search page on the website to find the nearest source of mentoring from over 1,800 locations. Alternatively, the SBA offers low-cost training in a range of areas including the following:
- Business planning
- Selling to the government
- Searching for financing
One of the SBA’s most significant means of supporting small businesses is through its certification program. Certified businesses are exposed to increased government and corporate contracting opportunities, which can be useful, particularly for women-owned businesses that are often overlooked. According to its website, “The SBA sets goals with other federal departments and agencies to award 23 percent in prime contract dollars to small businesses.”
On the SBA website, you can learn more about how to apply for certification — a process that requires a large amount of documentation and can take up to 90 days after submission — as well as the ways in which you can find and win contracts with the federal government.
The SBA also has contracting assistance programs designed specifically for minority-run businesses, such as the Women-Owned Small Business Federal Contracting Program. Certified women-owned businesses can use certification to gain an edge and reach their maximum potential.
The final way in which the SBA supports small businesses is through advocacy. Over the decades since it was founded, the SBA has facilitated significant legislative change that benefits American small business owners, including the Small Business Investment Act.
“The SBA reviews Congressional legislation, testifies on behalf of small businesses, and assesses the impact of regulatory burden on small businesses,” reads the website.
As a consequence, the SBA website is a great place to turn if you’re looking for information on the general state of entrepreneurship and the laws that do or don’t benefit small business owners.
How the SBA Can Help Your Business
The SBA differs from other agencies simply because of the scope of its resources. In addition to directly providing certification, the SBA works with hundreds of partners across the U.S. to provide comprehensive mentorship and teaching opportunities. Pretty much any resource or service you can think of, the SBA has within its docket.
Additionally, the fact that the SBA is a federal agency means that its events have a certain legitimacy. SBA events facilitate ample opportunities for business owners to network with government suppliers and other local and regional businesses.
Female entrepreneurs, in particular, can benefit from funding and mentorship support from the SBA that they may otherwise struggle to find. An example of an SBA success story is Dory Wilgus, who runs U.S. Flag and Signal along with her partner Ed Capps.
“I did not realize the support and expertise that SBA can provide. It wasn’t until I was approached did I understand what the SBA’s capabilities were,” said Wilgus in an online testimonial. “As small business owners, we don’t have the time to research how to correctly export. They have training events to help businesses grow that are free or very little cost. They back small business owners because we are the backbone of our deep economy.”
Wilgus credits the widespread success of her company to early financial support from the SBA, which helped her secure the space needed to grow the company.
No matter your business stage or need, you can benefit from the SBA’s offerings. If you want to learn more about what the SBA can do for you, you can contact the administration’s Answer Desk at (800) 827-5722 or the individual headquarters offices. For any questions about loans, contact email@example.com; for certification, reach out to firstname.lastname@example.org.