It”™s been said that small business is the backbone of the economy, but with 60 percent to 80 percent of new net jobs being created by small companies over the past decade, it”™s safe to say the sector is the nation”™s lifeblood.
“Typically large businesses are continuing to downsize while small businesses are hiring, but that”™s not to say that small businesses don”™t have significant challenges,” said Steve Cohen, senior vice president and deputy commissioner of Empire State Development.
“They do, and they include business costs, access to capital and retaining customers. It”™s important to address all three when you”™re thinking about public policy solutions to small-business challenges.”
Cohen, a former senior vice president for Seedco Financial Services, spoke at a forum Oct. 18 hosted by the Women”™s Enterprise Development Center in White Plains and State Sen. Suzi Oppenheimer, D-Mamaroneck.
He outlined a number of administration initiatives and said that lending through the state”™s major capital initiative, the Small Business Revolving Loan Fund, “has been brisk.”
“We are providing $25 million in capital to 20 intermediary lenders throughout the state, which are then providing an additional match of $25 million,” Cohen said. “Right now we”™re on track to meet our two-year goal of getting a total of $50 million into the hands of small businesses.”
Of the $55.4 million allotted to New York state by the U.S. Treasury through the Small Business Jobs Act of 2010, Cohen said, “We have a very aggressive rollout period and hope to meet some development milestones by the end of the year.”
Some $19 million will go into a Loan Loss Reserve Program, encouraging participating financial institutions to modify credit criteria to spur small-business expansion. Cohen said the governing agency expected all the rules and regulatory action to be complete last Thursday, officially launching the capital access program.
“We want to make sure the businesses who create technology here stay in New York state and create jobs in New York state,” Cohen said of the $25 million that will be injected into an Innovate New York Fund. “Even though we”™re a financial center, too much of the money for this very early, seed-stage capital moves out of state.”
In addition to easing the process of business licensing and of securing contracts, Cohen said there must be cooperation from lenders and businesses alike.
“Many sources have contracted in the lending that goes out and lenders are suffering because demand is down, so it”™s both of those elements contributing to a contraction,” he said. “We have to encourage traditional financial institutions to do more business lending, to work with the community of alternative nonbank lenders and it is incumbent to us to work with small-business owners on financial literacy” and to prepare concise loan documentation.
Resources
- Business First Portal ”“ nyfirst.ny.gov ”“ provides startup assistance, information on access to capital, government contracts and mandated government filings.
- New York State Contract Reporter ”“ nyscr.org ”“ provides access to all available state contracts. You can sign up for e-alerts that are tailored to your business needs.
- Counseling and entrepreneurial training programs are available at Small Business Development Centers and at Women”™s Enterprise Development Center, wedc-westchester.org.
