“small businesses will pave the road to recovery”
This according to the U.S. Chamber of Commerce, in an article By Tom Donohue, President and CEO, U.S. Chamber of Commerce – April 21, 2009 (see the following article from their web-site: http://www.uschambermagazine.com/content/090421.htm?n=w)
“Small businesses not only generate 60% to 80% of net new job growth and most American innovations, but they will also be the ones to lead us out of this economic recession. That’s why the U.S. Chamber is committed to ensuring that small businesses have an environment in which they can grow and succeed. It’s also why we’re committed to highlighting the critical role that they play in our economy and in the pursuit of the American Dream.
In these uncertain economic times, let’s take a moment to recognize some of the best companies in the small business community. On May 12, the U.S. Chamber will present America’s Small Business of the Year Award to a company that demonstrates exemplary performance in five areas: financial growth, staff training and motivation, community involvement, customer service, and business planning. Our judges read hundreds of applications and selected seven regional finalists who have succeeded because of hard work, long hours, and a little bit of luck. Allow me to share a few of their stories.
Charter School Business Management (CSBM), Inc., based in New York City, provides more than 100 charter schools with support in the areas of finance, operations, and human resources and donates hundreds of hours of pro bono services and advice to schools facing challenging financial conditions. Through its support of charter schools, CSBM is enriching the lives of children and preparing them for careers in the 21st century workforce.
Abstract Displays, Inc., located in Cincinnati, is a designer and producer of displays, banners, and other materials for trade shows and corporate events. Just months after starting the business in 2001, Carla Eng (who founded the company with her husband, Michael) was diagnosed with cancer. The Engs scheduled treatments around work and moved forward with their business plan. Since then, the company has experienced a 941% increase in sales revenue. This is an inspirational story of determination in the face of adversity.
Meier Architecture • Engineering of Kennewick, Washington, became an employee-owned company in 2007 when the majority of shares were purchased from its sole proprietor. Over the last four years, Meier has doubled its staff, as well as its revenue. To improve employee health, the company created a contest based on the popular TV show The Biggest Loser. For every pound employees lose, Meier contributes a pound of food to the local Second Harvest food bank.
America is a nation of entrepreneurs, and as these stories show, the American Dream is alive and well. Let’s remember this as we navigate these difficult economic times.”
___________________________
response to this article from limomangary:
this is news that most entrepreneurs have known since the beginning of the business world and certainly the same holds true for this recession. the article is timely and i believe something that both i and the other 3.9 million entrepreneurs that launced businesses during the past 18 – 24 months need and want to hear, but more importantly need to see a plan in action. the start-up statistics are based upon a report from forbes.com, in which forbes outlined the fact that the number of actual entreprenurial start-ups increased from 3.4 million on average from 1996 to 2006 to the number of 3.9 million in 2007:
what is most critical to the development of this indication by the U.S. Chamber of Commerce is deal flow reaching the early stage entrepreneur. by deal flow i am referring to: venture capital, private equity, sba loans (especially target for distresses early-stage businesses, that have weathered the storm but ownership and it’s books have taken a beating), commercial lending, etc. anyone that has an eye on deal flow and where money is going knows that major corporations are seeing not just stimulus money from the government but also merger & acquisition – to – projection based investment monies. if the U.S. Chamber of Commerce (the voice of business in America) feels that the small business is the way to best solve the financial crisis then there needs to be a sort of financial world “put your money where your mouth is” type of follow-up.
now i ask you the public: how or is the U.S. Chamber of Commerce correct in their thinking and what needs to be done, short and long term? do they need to be the champions of the cause or leave it to some other entity?
share your thoughts and leave a comment; i and the blog community want to know what you think about this topic, article, or my response. as always thanks in advance for being a part of this on-line community!
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When the Chamber of Commerce takes the necessary steps in educating “their” members on how to secure stimulus money. Maybe they can stand on their ideas.
John Feeney
April 28, 2009 at 7:51 am
Johh F.,
Very similar thought to my feelings on the matter; I felt it was a great outward gesture to make such a statement, it couldn’t hurt for small businesses like mine currently trying to raise funds through independent sources such as private equity, angel funds, etc. The fault though in the comment is as you started to outline there is no plan by the Chamber of how to ensure that small businesses see the reward of the sentiment that WE will lead the charge to recovery. That is something that the Chamber absolutely must correct and establish; I am personally tired of seeing small businesses fail due to the fact that WE are currently boxed out of $$$ deal flow. There needs to be more incentivized programs established, the fed is backing money to the failing giants the same should be done for the small business owner that could be showing profits if he/she were properly capitalized to put in plan an action plan that drives (pun intended; car service company) revenues up!
This would help banks and other INSTITUTIONS take on the risk of funding loans and credit for companies that currently have weak balance sheets & minimal to no profits at present, but that have strong development plans and potential to create jobs and generate substantial revenues…
limomangary
April 28, 2009 at 11:31 am
Folks John Feeney and I have exchanged a couple of email’s since the initial 2 posted messages above…I decided to post his reponse to my initial reply to him, after which I will then post my next and subsequent response after this post.
Here is what he said: “Help the banks / institutions? What more evidence does the American people need to see to cement the idea “Trickel down effect” does not work.
We support a failing bank that now refuses to extend credit because the “RISK” is to high. Considering they CREATED the RISK applicates in the first place through poor Mortgage lending practices they established to capture the “UNREGULATED” secondary market of Independent Brokers that prayed upon less than educated / ill-Informed individuals that had no business signing a contract for 200K+ with 2K down, No Savings to speak of, enability to pay “ON TIME”, annual income of less than 40K with a percentage of that being “SELF EMPLOYMENT INCOME”.
Those “Sharks” got feed and moved on. To this day, when someone tells me they we’re selling mortgages and the money they made, I just want to go crazy…….”
limomangary
April 28, 2009 at 1:16 pm
In response to John F.
John, I whole heartedly agree, my indication of “help the banks” was not to focus on the help being given to them but rather to make them begin to open the coiffeurs to the small businesses that they are currently turning down (mine included). We all know they have the money to take on the risk of funding a small business looking for 50K – 500K for development but choose to utilize a now stringent underwriting system; the infuriating fact of that matter is just what you indicated about the “200K+ loans to folks with limited income….ability to repay” the purse straps were extremely loose during that feeding frenzy, but now when a small business approaches them with a solid plan to build, create jobs, market and develop products or services (needing funding to do so) thus generating revenues and the ability to repay loans they are NOW very cautious and skeptical after playing a major role in creating this mess.
As of this moment the only places for entrepreneurs/small business owners to go is high-net worth individuals or groups such as private equity/angel funding/venture capital and large commercial banks, why because of the $$$ mess that was created the “friends & family” or micro lending sources don’t have the money or rather discretionary money to throw at a “good idea”.
That being the case is the reason whey the Fed & The U.S. Chamber MUST act to cause the institutional lenders to lessen there requirements and open doors that they themselves have closed to us the small business owner!
limomangary
April 28, 2009 at 1:17 pm
After reading some of the responses to this article on the U.S. Chamber website, I felt it necessary to write my own direct response to Mr. Donohue, below is that response. Here is the link to the article to see what others also had to say: http://www.uschambermagazine.com/content/090421.htm
Mr. Donohue,
I invite you to take a moment to view some of the recent posts and reactions on my blog about this article you wrote, here is the link:
http://limomangary.wordpress.com/2009/04/21/small- businesses-will-pave-the-road-to-recovery/
I am the owner of an early-stage car & limousine service that wants to build into a national service. I have been searching for funding for development, unsuccessfully for 18 months, because of the mess created by Washington, Wall Street, The Banking Institution, and the large industry giants currently receiving the benefit of TARP money. The general individual public doesn’t have money to get involved in the so called “friends & family stage” and the Banking industry all of a sudden (because of the housing/mortgage debacle) NOW decides to be diligent in their making loans & offering credit. Sadly, now not offering opportunity to the group(s) that would be in the best suited to utilize and create opportunity for jobs, and as a result generate revenues enough to repay the credit extended. That group Mr. Donohue is my group those that are the small businesses (disadvantaged or minority or women owned businesses) the very group and sub-groups that you wrote about but as an organization and government seem to not be doing anything about. I felt it was a great outward gesture to make such a statement, that couldn’t hurt for small businesses like mine currently trying to raise funds through independent sources such as private equity, angel funds, etc but banks and other INSTITUTIONS currently won’t take on the risk of funding loans and credit for companies that currently have weak balance sheets & minimal to no profits at present, but that have strong development plans and potential to create jobs and generate substantial revenues and would have the ability to repay loans. The point of “poor balance sheets & profits” is the essence of small business and why WE go looking for capital to get beyond this phase.
That is something that the Chamber absolutely must correct and establish; I am personally tired of seeing small businesses fail due to the fact that WE are currently boxed out of $$$ deal flow. There needs to be more incentivized programs established, the fed is backing money to the failing giants, the same should be done for the small business owner that could be showing profits if their business were properly capitalized to move on an action plan that drives revenue up!
We all know there is money to take on the risk of funding a small business looking for 50K – 500K for incremental development but now the INSTITUTIONS choose to utilize a stringent underwriting system, that’s an infuriating fact considering that the purse straps were extremely loose during the feeding frenzy that was the mortgage & housing market boom! As of this moment the only places for entrepreneurs/small business owners to go is high-net worth individuals or groups such as private equity/angel funding/venture capital, groups that have their own standard and preference for whom to fund, which is mostly not the small business. Because of the $$$ mess that was created the “friends & family” or micro lending sources don’t have the money or rather discretionary money to throw at a “good idea”, all these factors are effectively boxing out the small business and especially the early stage small business. That being the case is the reason whey the Fed & The U.S. Chamber MUST act to cause the institutional lenders to lessen their requirements and open doors that they themselves have closed to us the small business owner; bluntly speaking Mr. Donohue, you MUST do something about this!
(Poughkeepsie , NY)
limomangary
April 28, 2009 at 4:29 pm