SBA expands reach

Tameka Montgomery, associate administrator of the SBA’s Office of Entrepreneurial Development. (Photo: Courtesy of SBA)

The federal government is trying to do a better job helping small businesses in underserved communities grow, and is reaching out to community organizations as partners in doing so.

Earlier this month, the U.S. Small Business Administration and the National Association of Government Guaranteed Lenders launched the Business Smart Toolkit, designed to teach faith-based and community organizations to deliver education and training to aspiring entrepreneurs and small business owners among their membership.

“The idea is to provide a resource for these community organizations,” said Tameka Montgomery, associate administrator of the SBA’s Office of Entrepreneurial Development, “so they can provide a base level of information to their constituents, educating them and connecting them to the resources they need to grow their business.”

The Toolkit equips local community leaders to offer 60–90-minute presentations and workshops, starting with simple information useful to those who might be thinking about starting a business but do not know where to begin. The Toolkit provides PowerPoint presentations for each module, tips for successful workshops, an instructor guide and even customizable flyers to advertise the workshops.

The curriculum’s three modules — dubbed “Ready, Set, Go” — cover business startup basics, essentials of becoming credit-ready, and how to find additional resources for small business support and education.

Trusty intermediaries

The SBA, through its regional offices and local partners, already provides business development and support programs across the country, but Montgomery said the hope is that the Business Smart Toolkit program, with its reliance on community-based organizations, will be more effective at reaching underserved communities. Community organizations may be seen as trusted sources of information that local community members will be more likely to turn to than an SBA office.

“[The organizations] can be like force multipliers for our agency that help us spread the news and allow us to access more communities,” she said.

Prior to launching the Toolkit program, the SBA and NAGGL reached out to community organizations to ask what could be done to help them support small businesses in their areas. The feedback was overwhelmingly in support of the Toolkit’s train-the-trainer approach.

“Everyone that we spoke to said, ‘Yes, this is definitely what we need,’” Montgomery said.

About a dozen test-case organizations will serve as groundbreakers to roll out the toolkit program and jump-start awareness of how it works and how to implement it.

NAGGL is an association that represents small business lenders that take part in SBA’s guaranteed government loan programs. The chance to help more small businesses grow and become more credit-ready was too good to pass up, NAGGL leaders say, as the more businesses that reach the stage of needing loans for growth, the more potential customers the lenders have.

NAGGL President and CEO Tony Wilkinson said he hopes the program inspires more entrepreneurs to open small businesses, and wants his organization to provide as much support and resources as it can to make this happen.

The credit-ready aspect of the Business Smart Toolkit program is especially exciting to NAGGL leaders, as the organization works with traditional lenders who want their loans to be available to small businesses, but still need the businesses to be ready to pass loan applications.

Access to capital

The toolkit program can put small businesses on track to have quicker access to capital to fuel growth, said NAGGL Executive Vice President Jane Butler. She views the program as helping bolster a future generation of small businesses that lenders will be able to work with.

“We see this program as maybe being the step before traditional lending, for folks that might not be able to walk into a bank and walk out with a loan,” Butler said. “This is part of our commitment to make sure there is access to capital for all small businesses — even those that might not be ready for a traditional loan today.”

Bob Nelson, district director in the SBA’s Massachusetts office, said the Business Smart Toolkit program should provide a big boost to his office’s efforts to reach out to underserved communities. The model of connecting with community partners who in turn train entrepreneurs will be key to success, he noted, because it helps bridge the gap between neighborhood small businesses and the government.

“We have been spending a lot of time trying to increase our numbers to underserved communities. Things don’t change overnight, but when I look at the lending activity this year to date versus last year there are some strong trends in terms of numbers to minority businesses,” Nelson said.

On the national level, the SBA’s Montgomery said the toolkit program will keep her organization moving in the right direction in its commitment to communities of color and underserved communities.

“We are excited about it. We want to be intentional about reaching out to underserved communities,” she added. “We believe this approach will allow us to educate more people, reach out to more people, and make them more aware of the resources available to them.”