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Slide 1: Embrace the Teeter Totter Factor … What is so BIG about Small Business? Presented by: Jim Carroll Executive Director, BIG Center Kentucky Highlands Investment Corporation London, Kentucky
Slide 2: KHIC‟s Mission To provide and retain employment opportunities in Southeastern Kentucky through sound investments, training and management assistance. Regional, private, non-profit business development corporation founded in 1968 serving 22 counties in Eastern and Southern KY.
Slide 3:     Created or retained over 10,000 jobs Assisted 483 businesses Invested over $180 million Created or retained over $120 million in annual wages
Slide 4: How Do We Accomplish Our Mission?        Micro- Enterprise Loan Program – up to $35,000 Small Business Loan Program – up to $250,000 USDA B&I Loan Program – up to $10,000,000 Revolving Lines of Credit Equity Investments Support Entrepreneurs with Training & Coaching Business Incubation
Slide 5: Definitions… Small Business – a for profit business with 500 or fewer employees that is independently owned and operated. US SBA Micro Enterprise – a business having 5 or fewer employees and seed capital of no more than $35,000. Wikipedia Entrepreneur – an individual who starts a for profit business with the idea to supply a product or service which is better, faster or cheaper than what is currently available. Jim Carroll
Slide 6: Economic Development Recruitment (Get „em) Retention (Keep „em) New Companies (Grow „em)
Slide 7: “For the United States to survive and continue its economic and political leadership in the world, we must see entrepreneurship as our central comparative advantage.”
Slide 8: What you should know…  1/3 of GDP comes from companies that didn‟t exist before 1980  Between 1980 and 2005, young companies (<5yrs) accounted for ALL net new job growth Firms have been started in bad economic times   FedEx, Microsoft, Apple, Southwest 50% of Fortune 500 and Inc. 500  Since 1980 the US has made a “profound shift from a „managerial‟ to an „entrepreneurial‟ economy.” Peter Drucker
Slide 9: What you should know…  New companies create new industries  Small businesses are more productive Small businesses pay better wages (+15%) Employees of small companies have higher job satisfaction Small businesses are a major source of innovation   
Slide 10: What should concern you…  Little “economic stimulus” is directed towards Small Business - $15 billion of $1.5 trillion Policy tends to hurt Small Business    Sarbanes Oxley Health Care Taxes   Higher Education    27% of graduating college seniors plan to work for nonprofits More seniors will graduate with sports degrees than electrical engineering degrees < 20 business will be started for each $1 billion in university research
Slide 11: What should give you hope…  SBA Policy…      Elimination or reduction of SBA loan fees Raising SBA guarantee Raising loan maximums Expansion of SBIC program State is streamlining application processes  Bank regulations focusing on Small Business “Economic recovery will be driven, in a large part, by America‟s small businesses.” – White House Statement
Slide 12: Things I Think I Think…  SEC and states need to allow third party securities (peer-to-peer loans such as Kiva, Prosper) to operate without standard regulation Allow shareholders of Small Business to choose SOX compliance Health care reform – level out small business costs, eliminate “entrepreneurship lock” Immigration – green cards for job creators University Technology License Office competition Educators… Stop vilifying capitalism and free enterprise States need overarching visions for Small Business Economic Development Each community must adopt a plan for creating a Small Business Ecosystem        Creating a System of Support for Entrepreneurs and Small Business in Kentucky: Insights and Policy Recommendations, Marley and Dabson
Slide 13: The Teeter Totter Effect It only takes a small shift one way or the other to make a negative or positive impact on a community. “Just one person can really make a difference – either for good or for bad.”
Slide 14: The Teeter Totter Effect       Identify the Champion Use the Champion to make introductions to community leaders – don’t expect this person to deliver YOUR message Understand the political dynamics Know the hot-buttons for the community Show support for other projects already in place Communicate, communicate, communicate…
Slide 16: E Entrepreneur Ecosystem Training Capital Connections Entrepreneur Mentoring Commerce Connections Networking Facilities
Slide 17: E Entrepreneur Ecosystem Training  Provide practical business skills training  Recruit Trainers  Provide training to Trainers  Offer classes on a regular basis  Partner with local Higher Ed Institution(s)     Offer lecture series on Entrepreneurship Encourage participation in Excellence in Entrepreneurship Awards Publicize Boot Camp to students Provide facilities to conduct Boot Camp  Encourage High Schools to introduce entrepreneurism  Offer lecture on Entrepreneurship  Offer Junior Achievement program  Encourage participation in Entrepreneur Leadership Institute
Slide 18: E Entrepreneur Ecosystem Mentoring  Engage SBDC, SCORE, Chamber of Commerce, ED  Deliver information to Entrepreneurs on existing programs  Provide Mentors and Coaches  Recruit Mentors and Coaches from existing business leaders  Provide training to Coaches  Establish Coaching Connections  Assign Mentors to Entrepreneurs  Mentors to schedule regular meetings with Entrepreneurs
Slide 19: E Entrepreneur Ecosystem Facilities  Identify space for collaboration with other entrepreneurs  Establish Business Accelerator (nice to have)  Shared office & conference facilities, shared technology, shared manufacturing  Below-market rates  Favorable lease terms (short-term, no personal guarantee)  Furnished
Slide 20: E Entrepreneur Ecosystem Networking  Utilize technology to communicate with Entrepreneurs  email, Facebook, Twitter  Sponsor regular networking events for entrepreneurs  Establish CEO Roundtable group  Sponsor Lunch & Learn Series  Recruit small businesses to join Chamber of Commerce  favorable rates  benefits
Slide 21: E Entrepreneur Ecosystem Commerce Connections  Establish a formal business networking group  Establish “Do Business Local” campaign  Establish/maintain connections with State and Fed policy makers  Make connections with University tech transfer organizations  Sponsor an annual Export Expo  Encourage E-commerce  Identify local developers  Encourage instruction at local education institutions
Slide 22: E Entrepreneur Ecosystem Capital Connections  Involve local banks  Cultivate relationships with local investors, CDC’s, etc.  Identify local and state private investors  Sponsor an annual Small Business Showcase  Educate entrepreneurs on due diligence expectations
Slide 23: E Entrepreneur Ecosystem Training Capital Connections Entrepreneur Mentoring Commerce Connections Networking Facilities
Slide 24: What is so BIG about Small Business? Jim Carroll Executive Director, BIG Center 606.260.0830 jcarroll@khic.org