Small businesses remain starved for the capital required to grow their businesses at this time. Banks are not an option for these companies just developing financial results vs. lending to established proven businesses with track records that represent very low risk to banks. Low risk is not a measure of innovation and entrepreneurship, rather safe and status quo. One might ask whether providing capital for growth is actually an intended function of banks, but actual behavior is the best indicator. It is also nearly impossible to turn the aircraft carrier – known as the SBA – into the wind to provide that capital, so give up on that venue also. Guaranteeing a bank loan with near zero risk through either federal or state agencies already is effectively redundant and wasteful – and for an additional fee due to our government, no less.
These behaviors are not worthy of association with an innovation economy.
What is innovative - is when a sitting US Congressman, Seth Moulton, identifies a potential capital source – Inner Cities Capital Connections and arranges access to that source of capital for small businesses located in small cities throughout his Congressional district. What actually is the definition of an Inner City – an older, disadvantaged section of a large city – is not even defined within smaller cities in this district. This can be the ‘juice’ to return manufacturing jobs to the US economy. The activities of the Inner City Capital Connections are innovation in action.
ICCC is a proven source of capital acquired through commitments from a variety of private sources and deployed to thousands of small businesses across the United States, but up until now principally in large cities like NYC, LA, Chicago, and Dallas. In addition, ICCC provides relevant business training to business owners desiring to grow their businesses, preparing an approach to raise capital, and through introductions to these potential sources of capital. This program has proven success with over $1 billion deployed to small businesses to promote growth.
This approach is innovative in many ways – a US Congressman being involved, the designation of a district as alternative to a large city, availability within smaller cities, and support for early stage and small businesses. Kudos to Cong. Moulton for thinking outside the traditional government box and providing support for small businesses located throughout his district.