The U.S. government has an agency that specializes in serving the needs of entrepreneurs, called the Small Business Administration (SBA). The entity is responsible for offering assistance in four priority areas: administration, promotion, bidding, and financial assistance. This institution provides companies with essential resources to establish, develop and consolidate themselves. You have to get to know its characteristics and take advantage of the available tools.
There are three ways in which you can get advice and support from the SBA, in person at one of its offices, by telephone, or through its website, which is considered the holy grail of entrepreneurship, thanks to all the educational resources it has.
One of the SBA benefits that most people take advantage of is financing. To find the best small business loans is a complicated task, but with the help of the government entity, you can access better interest rates and greater flexibility in the payment, compared to what financial institutions offer if you apply independently.
SBA: what it is and importance
As of 2020, the SBA had 31.7 million businesses registered, representing 99.9% of all firms in the United States and generating 60.6 million jobs. These figures are obtained by identifying the type of businesses that are established, the industries and sectors, geographic location, among other demographic data. Its task is to contribute and generate the necessary instruments for adequate business development in the country.
How this entity works, and how is it helping entrepreneurs
The Small Business Administration was founded in 1953 to encourage entrepreneurship in the United States. In the financial aspect, the SBA operates with a government budget, and its financing products work in a very simple way, offering loans through banks and cooperatives, guaranteeing that if any of the companies requesting the capital does not comply with the commitment, the agency will cover the debt.
To apply for any of these financing products, small businesses must meet the following requirements:
- Operate in the United States.
- Meet the definition of a small business (number of employees, annual revenues, and net worth of the company).
- A minimum credit score of 680.
- Demonstrate that you have had difficulty obtaining financing through other channels.
- More than two years of business operation.
Besides financial resources, the SBA provides advice to entrepreneurs. Through its website, you can access informative material depending on the stage of your project. From the planning of a business from scratch, in the launching phase, to the administration and operation, as well as the development of expansion plans.
Another of the benefits offered by the Small Business Administration is the possibility of obtaining supply contracts with federal government entities. These types of bids are great opportunities to enhance the growth of any company.
Why does a rising business need financial support?
Lack of capital can mean death for a business. The growth processes of a company must be accompanied by investments to improve its operation, administration, sales process, and marketing strategies. Currently, there is a wide range of financing available, some from government entities such as the SBA, others from traditional banks, and a growing option are online lenders.
There are financing products tailored to all types of needs, from grants or small business loans to business credit cards or merchant cash advances. Depending on the type of business you own, some businesses, particularly minority-owned ones, cannot access SBA benefits due to lack of documentation, and the situation is replicated with banking institutions.
If this is your case, get to know the offer of different online lenders, which have fewer requirements, and their processes are much faster and simpler. Starting a business is an adventure that will change your life radically; it will give a better standard of living to your family and will mean the basis to achieve the American dream. Don’t let your goals collapse; generate a stable business model, get small business loans and achieve the lifestyle you’ve always wanted.