Can the Feds Help Promote Small Business Growth?
Can the government help spur entrepreneurship and business growth? Apparently they think the can-the Department of Commerce just formed the Office of Innovation and Entrepreneurship, as well as a National Advisory Council on Innovation and Entrepreneurship. The new Office of Innovation and Entrepreneurship will report to Commerce Secretary Gary Locke:
“We’re not lacking for groundbreaking ideas in this country; nor are we short on smart entrepreneurs willing to take risks,” Locke said in announcing the initiatives. “What we need to do is get better at connecting the great ideas to the great company builders. I think The Office of Innovation and Entrepreneurship is a big step in the right direction.”
The National Advisory Council on Innovation and Entrepreneurship will include entrepreneurs, innovators, investors, leaders of nonprofit organizations and other experts. The Council will advise the Commerce Department on policies related to small businesses and will encourage dialogue between Commerce and the small-business community.
In its launch announcement the Department of Commerce said that the mission of the Office of Innovation and Entrepreneurship is “to unleash and maximize the economic potential of new ideas by removing barriers to entrepreneurship and the development of high-growth and innovation-based businesses. Working closely with the White House and other federal agencies, this new office will drive policies that help entrepreneurs translate new ideas, products and services into economic growth.”
The new office will concentrate on six key areas:
1. encouraging entrepreneurs through education, training and mentoring;
2. improving access to capital;
3. accelerating technology commercialization of federal research and development;
4. strengthening interagency collaboration and coordination;
5. providing data, research and technical resources for entrepreneurs; and
6. exploring policy incentives to support entrepreneurs and investors.
Additional initiatives will be announced in the coming months.
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About the Author: Rieva Lesonsky is CEO of GrowBiz Media, a content and consulting company that helps entrepreneurs start and grow their businesses. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America ‘s entrepreneurs for nearly 30 years. Follow her on Twitter @Rieva and visit SmallBizDaily to read more of her insights on small business.
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Thanks Rieva, this is a really informative article. I’m looking forward to your follow-ups on this topic and in reading more of your articles!
Very interesting article. Sorry, but the government will only get in the way of economic progress. I question whether this new department can be effective when the rest of the government is about to impose increased costs on most small businesses, including new health care programs, cap and tax, and union payoffs such as “card check”.
I agree with Kip. The government is the one of the least entrepreneurial organizations in the country. They actually are the definition of bureaucracy, so I doubt they will be able to do much for entrepreneurs and small businesses. While I admire the thought I won’t be holding my breath for their help.
Hi Rieva, welcome to the community. Most of us here are very familiar with your work and appreciate your perspective and insights. The post is informative.
A litmus test I might offer this new office and initiative that is going to help entrepreneurs and small biz owners is this: Participate. Jump in here at Small Business Trends. Put 5 dozen interns into a social media “room” and let them start helping people. Demonstrate that you get what the local startup is facing, offer ideas, get in the game. Their advice and effort is less helpful if we don’t trust them and many people simply don’t. They could turn that impression around. It has been done before.
If #1 is really #1: “Encouraging entrepreneurs through education, training and mentoring.” Then they need to hit the streets and know what’s going on. I would love to see the gov do something innovative. I know they can do it. I’ve seen firsthand the good they can do in a person’s life, but they need someone passionate and in touch to help drive it to real success.
Finally, if they can’t manage the social media idea, then they should at least buy an RV, paint it with some hip colors and logos, and drive around the country talking to people. They can start with Cleveland and visit one in-touch entrepreneur we all know… She has her finger on the pulse of 250,000 of them.
Call your people, Rieva… Light an innovation fire.
Thank you all for your comments and warm welcome here. I may be in the minority, but I actually think the government can help, but they need our input to do so. Small business owners need to tell all our elected reprensentatives what we think and what we need.There are millions of us small business owners out there, and our views are often misrepresented by other people, organizations and politicians.
TJ–I’m happy to be the spark, but it’s going to tak all of us to keep the fire burning.
All of it sounds good–but the biggest problem, and what should have been first on the list, is access to capital. Good ideas, savvy marketing, social connections, great business acumen are not much without the ability to tap into money. Hope the Feds will loosen up the $$$s.
Rieva,
This could be great!
{Not to be a Negative Ned here, but I am afraid of the layers. Very Afraid)
The Franchise King
Joel Libava
I’d love to get involved with such a group to help brand these future “entrepreneural” endeavors.
Any ideas on how I might be able to get involved?
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Thanks and Regards
Noel for Nopun.com
a professional graphic design studio
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I have written several posts on the land of opportunity and why entrepreneurial spirit is strong in the United States of America. I agree Kip Marlow (I am interested to learn more about The Entrepreneur’s Club of America (TECA)), Robert Brady and Joel Libava regarding the bureaucratic tendencies. To end my comment with a twist, check out the old British TV-series Yes, (Prime) Minister based on the book with the same title.
I could tell you about similar “experiments” here in Sweden, if you are interested…
I look forward to return to the Land of Opportunity…
[...] Could this help? Rieva Lesonsky common this report over at Small Business Trends. [...]
There are 2 specific issues that I think a government agency could tackle that would support small business growth.
1) Make the IRS treat all small business people equally. It is absolutely unfair to treat health care premiums as taxable income for small business owners, while the very same benefit for the employees of that small business is not taxable income. With premiums running $13,000 a year, that’s an extemely unfair tax.
2) Stream line SBA’s paperwork. We were fortunate enough to get a 504 loan. The process was very lengthy, taking about a year and half from start to finish. The closing documents were a stack of papers over an inch high, but we made it through and the closing took place in June 2006. We found out early last year, when we sought additional funding, that the 1″ thick stack was not filed properly so, basically, we couldn’t borrow against the building because SBA has to approve any additional borrowing against that collateral, which they won’t do until the documents are properly filed. In spite of multiple requests, I still do not have the necessary documents from SBA.
It would be better if the IRS and the SBA would self-police rather than generating another agency, but entrepreneurs and small business need an advocate. These 2 issues boil down to such a basic level of inequitable treatment and apathy, that it is obvious that the IRS and the SBA really won’t or can’t help in the absence of some outside push.
I am going to put this program into the category of: “We’re from the government, and we’re here to help”. (For those of you don’t know, you’re supposed to run away as quickly as possible when you hear those words).
You know what would really help us out? Stop confiscating our money and spending it on silly nonsense like this!
How in the world can the President bail out banks and then turn around and committ monies to small business? Can he force banks to lend? extend credit? I am quickly watching lines of credit I have established years ago, shrink to nothing ($16K to $2K) and not for lack of payment….banks/lenders must pay forward the bailout monies by supporting small business. If they won’t, will feds just print more money and lead us quickly into a recession?
Support for innovation – yeah.
Support by mentoring – yeah.
Bottom line is money to make it happen. Let’s hope the money appears.
So I’m curious, and maybe your responses will lead to another blog post or two. If you the goverment were to “bail you out” how much money do you want and what would you use it for?
I would not advocate for a bail out. I’m too concerned with the amount of debt that our nation has assumed already.
I think that many of us our expressing frustration over the simple fact that the banks were given astronomical amounts of money from taxpayers wallets while simultaneous making less money available to those same taxpayers. The banks have behaved like pirates. We’ve been betrayed.
If each existing government entity looked at their policies and practices trying to find where they inhibit small business and actually made changes that were geared toward improvement, I think our situations could improve without a bail out.
An area of need is for educational institutions to get the entrepreneurial bug. Too often community colleges cry “Woe is me” when cutbacks come, when they should be thinking like entrepreneurs and finding ways to thrive in a down economy. I’d like to see this new office help such institutions move past the “government handout” philosophy to the “we are masters of our own fate” mindset that business owners understand and work with.
Rieva,
Thanx for the post. I am sharing it with the “CEOs, Angels & VCs” group of “MedTech-IQ”, an international community dedicated to the translation of medical technology from “Lab to Market”, http://medtechiq.ning.com/group/medicalangelsvcs/forum/topics/us-government-launches-new.
[...] Rieva Lesonsky common this report over at Small Business Trends. [...]
Informative, but what’s the difference then between this organization and the Small Business Administration that has long existed and formed to focus on most of the same key areas? Why form yet another agency that seemingly has similar goals and offerings instead of improving and expanding the scope of one that already exists? At least the SBA is an independent agency and not likely be influenced by larger corporations and lobbyists. I’m a Democrat and I’m growing a little skeptical of the number of these “councils” that are being formed for our “benefit” before attempting to revamp or eliminate something that isn’t working.