The Big Deal About Small Business, Part 1

Think big? Think again…

A January 24, 2015 article in the New Yorker exposes the advantage that small businesses have over their larger rivals, namely “true differentiation”.

“Most profoundly, the trend creates an industrial upheaval important to the long-term strength of the economy. It suggests an economy that is alive and reinventing itself, that is mutating from within, that is engaged in the never-ending process of creative destruction.”

BusinessUS supports the growth of small businesses by providing timely and affordable small business loans. If your small business has a true differentiation it wants to promote, contact Norris Lozano for information about new capital to get it done.

Shark Tank gets schooled by a good man

Watch Johnny Jordan teach the sharks: http://omeleto.com/206317

 

 

 

SBA says: Small Businesses Create 2 Million Jobs

From an early January post from SBA Administrator Maria Contreras-Sweet: “Last week’s jobs report offered more evidence that our economy is gathering a head of steam as we ring in the New Year. Last month, American businesses added back 252,000 jobs and our unemployment rate fell to its lowest level since June 2008. We’re in the midst of 58 month of consecutive job growth – the longest streak on record since the mid-1990s.

Read the article here.

~ Norris Lozano, CEO of BusinessUS

How Grameen Bank is about barn raising, and other observations

“When Nobel Prize winner Muhammad Yunus founded Grameen Bank, his innovation was not so much the idea of lending small sums of money to poor villagers in Bangladesh; it was the idea of lending to small groups of women who could help each other make the best use of the loans and ensure repayment. The community was the big idea.”

So says Tim Brown, CEO of Ideo.

The concept of providing capital that helps communities grow is not new to BusinessUS. Please reach out if a small business or organization in your community needs a boost.

 

Fed says: One-Third of all small business loans are SBA-guaranteed

Today, Bob Coleman reports on the “2014 Joint Small Business Credit Survey“, a study compiled by the Federal Reserve Banks of New York, Atlanta, Cleveland and Philadelphia, that reveals that one in three small businesses that received credit in the first half of 2014 came in the form of a SBA loan.

One-in-three.

Wow.

Read more news about SBA lending at the Coleman Report.

~ To find out whether your small business qualifies for an SBA loan, please contact BusinessUS using our contact page, or send an email to Norris Lozano, our CEO,

Small Business Loans: hot… or not?

The media is hungry for clues about the direction of the American economy. And as we know, small business is a key engine of this economy, providing 55% of all jobs and 66% of all net new jobs since the 1970’s, as well as 54% of all US sales.

Here are a few positive snippets from recent news:

• “U.S. small business confidence at eight-year high; job openings rise“

U.S. small business optimism jumped in December to its highest level in more than eight years, the latest sign of strength in the economy even as dark clouds settle over global growth….The outlook was further bolstered by other data on Tuesday showing job openings approached a 14-year high in November.

• “Small Business Transactions Signal Improving Economy”

  The number of purchases and sales of small businesses, at an all-time high in 2013, grew even more during 2014…Participating business brokers reported 7,494 closed transactions in 2014, an increase of over 6 percent from the 7,056 transactions in 2013.

• “Survey finds 54% small business loan approval rate“

But perhaps these headlines grabbed you:

• “Small Business Loans Up at Big Banks, Down at Small Ones“

So 2014, on the whole, seems to have been a good year for small businesses seeking capital from banks to grow…..But if you look at the numbers another way, you’d see that this increase is only telling part of the story. It’s a story of success mainly for small businesses seeking big money from big banks.

• “Too Little to Borrow? Small-Business Lending Lags“

U.S. small-business lending never quite regained the ground lost during the Great Recession, ceding significant market share to larger firms that have benefited from a gradual but lengthy economic recovery, research from the Federal Reserve Bank of Cleveland finds.

Seems to be a mixed bag… so here’s some clarity. Big banks are stepping up to the plate for small business after almost 6 years of kicking them to the curb. But only in larger amounts. No surprise here: big banks make big loans to make big profits.

Where small business lending is growing is sub $150,000 loans, which many new online lenders are happy to provide – at massively high rates.

What’s still missing in the picture is the traditional meat-and-potatoes of the small business lending picture: community banks lending to small businesses in their communities.

Says Carly Fiorina in Inc. Magazine: “Unlocking capital is very important, and of course since the financial crisis, the surviving big banks have gotten bigger, but the community banking system is really struggling, and that means small businesses are struggling. It is community banks that provide most of the capital to small business, and [we need to] start unlocking small business loans again. We have got to get capital to them so they can form and thrive.”

If you want to learn more about small business loans, contact BusinessUS

Companies tend to die, Cities don’t

Tony Hsieh has led Zappos to the business stratosphere, with unique approaches that resonate with its customers.

Inc. Magazine tells of 10 Steps to Zappos Success. 

US News & World Report lays out the unique reasons that Zappos “… went from a struggling start-up in 2000 to getting acquired by Amazon in a deal valued at $1.2 billion in 2009.”

Legend has it that:

• 75% of its sales come from returning customers
• …who also spend 2 1/2 times more time on the website than first-time visitors
• the longest customer service call took almost six hours.
• Another rep helped a caller locate a nearby pizza place that would deliver after midnight.

Some say that Zappos’ success is proof that Customer Service is the new Marketing.

Now we hear that Zappos is creating an “entrepreneurial utopia” in Las Vegas (Zappos’ offices are now housed in the old Vegas City Hall), and has changed the corporate structure to a “Holoacracy“, because “Look at companies that existed 50 years ago in the Fortune 500—most don’t exist today. Companies tend to die and cities don’t.”

 

~ If you have a unique concept for your small business need funding to get it going, please contact Norris Lozano or Stephanie Bitters at BusinessUS about an SBA loan. We’d like to support you on the road to Zappos-dom.

SBA Extends Fee Waivers for Veterans and Small Loans

The U.S. Small Business Administration announced that it would extend 2 important fee waivers until Sept. 30, 2015. SBA will continue to waive the 2% Borrower Fee (also called upfront guaranty fees) for loans under $150,000 and for Veterans Advantage loans from $150,000 to $350,000.

SBA is also halving the rate of the upfront guaranty fee for non-SBA Express loans of $150,000 to $5 million.

The fee waivers were originally scheduled to end Sept. 30, 2014.

Certain restrictions apply to SBA loans. If you have questions, please contact Stephanie Bitters at BusinessUS.

16 Hot Startups that Launched in 2014

Business Insider has issued its Best Startups of 2014 List, and it’s worth the read.

As should be expected from a media source whose CEO is Henry Blodgett, there’s a whole lotta technology on the list, analyzed by factors like

• funding
• revenue
• growth, and
• investor interest.

Here’s the article:

Here’s the list:

1. GLAMSQUAD brings hair salon-quality blowouts to your apartment.
2. Spring is the Instagram for shopping.
3. DWNLD makes apps easy to make, customize and get published in the App Store

4. Ello is the ad-free, anti-Facebook social network.

5. Curbside lets you order stuff on your phone and pick it up at the store without leaving your car.

6. Reserve takes all the pain out of making restaurant reservations.

7. Shyp sends your packages for you, so you never have to step foot in the post office
8. Jet.com is Marc Lore’s mysterious “Amazon-killer” e-commerce website.
9. … More …

~ For more information about using an SBA Loan as part of your startup capital, please contact Norris Lozano at BusinessUS

Small Businesses add a million new workers in 2014

“Small employers added 106,000 workers to their collective payrolls in December, according to the latest round of data issued by payroll processing firm ADP. That’s up from 99,000 added the month before and the fourth consecutive month of employment growth exceeding 90,000.

Over the year, small businesses added more than 1 million employees, averaging monthly additions of 90,000 workers — up from last year’s pace of about 80,000 per month.”

Read more here in the Washington Post

~ want to learn more about small business loans? email Norris Lozano or visit the BusinessUS website

Washington DC may assist more small businesses in the New Year

“Small businesses are looking for government to function and get a lot more done,” said John Arensmeyer, chief executive officer of the advocacy group Small Business Majority.

A few of the options on the table in this upcoming Congress are:

1. Reduction in corporate tax rate from the current 35%
2. Small Business tax deductions
3. Bonus depreciation
4. Reduction in paperwork for SBA loans.

“It’s expected to encourage more banks, particularly smaller ones, to make SBA-backed loans, said SBA Administrator Maria Contreras-Sweet.”

Read the full article here.

~ Learn more about small business loans by contacting Norris Lozano at www.Bizbank.US

“8,000 small business loans are declined every day by banks”

Time well spent: Have a look and listen to this impactful talk with Connie Evans, President & CEO, Association for Enterprise Opportunity in Washington DC, hosted by Bob Coleman of the Coleman Report.

Ms. Evans gives an impressive array of facts about the benefits of micro-lending (loans of up to $50,000) and micro-capital (up to $250,000) to small businesses of up to 5 employees.

Among others, she says that such businesses are declined for loans by banks at a rate of 8,000 declines per day.

8,000. Declines. Per. Day.

The opportunity to serve these underserved small business borrowers is profound.

~ Norris Lozano, CEO, BusinessUS, a California-based small business lender

Small business time-saver: automate your social media posting

Small business owners rejoice (happy feet under the desk will suffice) – there’s an easy way to save yourself from a major social media time-suck.

Scene: You’re a big believer in developing new marketing content, and then sharing it across your social media.

(Excellent, you’re right on-trend!)

The deal: You write the piece, and post it on your blog (and you only post with pictures, right? … Of course you do)

The problem: You have to then post on Facebook, and Twitter, and LinkedIn, and Google+…. Half an hour… times 2 times a day… 5 times a week…

Srsly?

Our good friends (BFFs, really) over at Talent Zoo turned us on to an app called IFTTT – – If This, Then That.

With IFTTT, you can automate all the re-posting, and save yourself a ton of time.

The solution: Read all about it here

~ Christopher Smith, BusinessUS

What’s new in small business? Optimism(!)

 

 

And now, a headline that wants to brighten your day, “Here’s a Round-Up of Small Business Surveys That’ll Cheer You Up”

Lots of good topical research here into the mood of small business owners around the country. For example:

• “…80 percent of the small businesses they polled grew their revenue in the past year and 90 percent forecast a revenue growth in 2015” (says the Accounting service Xero)
• “…optimism is at a two-year high and 58 percent of those firms planned workforce increases” (says Vistage)
• “…77 percent of small business owners feel they are “successful” and a majority of them believe that they have access to capital if they need

Are you a California small business needing a loan? Try BusinessUS

 

For small business, a lot of lending is moving online

We’ve read multiple stories recently (here are just a few one, two, three, four…) about small business lenders accomplishing astonishing numbers with online lending platforms. In our research we’re finding that this new money appears easy to get (the online applications and due diligence are relatively simple), but the price is steep (annualized interest rates of up to 70%).

Problem is, small businesses have fewer financing options now then in the last decade. Indeed, small businesses have suffered 3 ways when it comes to acquiring capital they need to grow. According to the Harvard Business Review:

1. “A decades-long trend toward consolidation of banking assets into fewer institutions is eliminating a key source of capital for small firms….”
2. “…collateral owned by small businesses lost value during the financial crisis, potentially making small business borrowers less creditworthy today…”
3. “In the recent recession, small-business sales were hit hard and may still be soft, undermining their demand for loan capital…”
4. “…. tightening on loan terms, including the Federal Reserve Senior Loan Officer Survey, for small businesses increased at double-digit rates during the recession and recovery, and have eased at just single-digit rates over the past several quarters. Loosening has been much slower and more tentative for small firms than for large firms…” (italics added)

Despite the low barriers to lending, these expensive online lenders are not a sustainable solution to small business borrowing needs. What’s often overlooked in this discussion of small business loans are SBA loans. SBA loans are available from banks and non-bank lenders to American small businesses that “can not get credit elsewhere” (small businesses that are underserved by traditional lenders) at competitive rates (about 6%) with an SBA guarantee.

~ Norris Lozano

CEO of BusinessUS