Feds award cash prize to small biz incubators
Economists acknowledge one very important indicator of the nation's financial strength is the state of its small business sector.
The Small Business Administration notes that, while corporate America has been downsizing its operations for years, the number of small businesses has grown dramatically -- up 49 percent since 1982 -- accounting for more than half of all U.S. sales. Small businesses have reportedly added 8 million new jobs to the economy since 1990. During that same time period, in comparison, big business eliminated 4 million jobs.
Data released late last month by the non-profit small business assistance group SCORE found a large majority of consumers believe small business are a crucial part of the nation's overall economic health, and say they consciously shop at local small businesses to keep them thriving.
The SBA is also putting some skin in the game, via its first-ever Growth Accelerator Fund competition. The agency on Monday announced the 50 winning organizations (out of more than 800 applications) that will each receive a $50,000 cash prize from the SBA. Officials say the competition is meant to bring attention and funding to small businesses in parts of the country where, according to the news release, "there are gaps in the entrepreneurial ecosystem."
The winning entries were chosen by a seven-judge panel of experts in entrepreneurship, investing and business planning from both inside and outside of the federal government.
"We've seen the enormous success of the accelerator model in communities like Silicon Valley," SBA Administrator Maria Contreras-Sweet said in a statement. "We believe we can export this type of sophisticated support structure across the country to help start-ups become commercially viable and create jobs more quickly."
The winning firms are from 31 states, the District of Columbia and Puerto Rico, and represent a wide variety of demographics and industries.
One winner, EatsPlace in Washington, D.C., is a self-described "food and restaurant incubator." Among its services, the community commercial kitchen and marketplace offers dining space to host "pop-up" restaurants and guest chefs-in-residence.
Another organization getting the $50,000 SBA award is 712 Innovations. The Topeka, Kansas, incubator provides would-be entrepreneurs with space where they can work to get their ideas off the ground and access the organization's training programs and business services.
Winning the cash prize doesn't mean the recipients can sit back on their laurels. By accepting those funds, the so-called accelerators are then committed to one year of quarterly reports on such elements as job creation, fundraising, corporate sponsorships obtained and startup businesses launched.
The SBA plans to take that information from its award-winners and turn it into a database "to develop long-term relationships with the start-ups and constituents in these innovative and entrepreneurial communities."