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2014 Small Business Week Activities

It’s that time of year again! SBA is gearing up for National Small Business Week, May 12-16. And like last year, they’re taking the show on the road to celebrate small businesses across the United States. They’re excited for this year’s activities, which will include forums and panels about trends in small business, innovation, financing, business growth – and more. There will also be matchmaking events and networking opportunities.

The week will kick off in San Francisco on May 12, followed by events in Kansas City, Boston and Washington, DC. They wrap up in the nation’s capital by honoring small businesses from across the country, culminating in the announcement of 2014’s National Small Business Person of the Year.

In addition to the in-person events, the SBA will sponsor several webinars of interest to small businesses.

Check out the full National Small Business Week conference schedule.

Small Business Week 2014 Kickoff @Twitter HQ

The SBA brings together leaders from the small business, government, consumer and high-tech communities to raise awareness for #smallbiz across the nation. They’ll also share exclusive content to help you learn how social media can be integrated into marketing strategies to help drive your business growth.

This event takes place at Twitter HQ in San Francisco and is SOLD OUT. It will be live streamed.

Click here to add your name to the waitlist.

Time:
Monday, May 12, 2014 from 7:30 AM to 12:00 PM (PDT)

Matched Savings for Entrepreneurs

AFI and Small Businesses: Helping Entrepreneurs Build Assets

Entrepreneurs benefit from maximizing the equity they can invest in their businesses, but low-income individuals may not have that much to start with. That’s where matched savings accounts like Individual Development Accounts (IDAs) can be helpful. Matched savings accounts – similar to 401(k)s – allow entrepreneurs tobuild capital for their small business. Monthly deposits from participants are multiplied by the matching funds offered, up to $4,000. In addition to accumulating capital, participants establish a history of regular savings that demonstrates creditworthiness that can strengthen their potential for other financing options, such as microloan programs.

CAMEO hosted the AFI Resource Center as they discussed how matched savings programs work and benefit low-income entrepreneurs and microenterprise development organizations. This webinar also showcases the work of a current AFI grantee, the Community Action Partnership (CAP) of Sonoma County, who will share insights on managing an IDA program and supporting low-income entrepreneurs.

Sheilah Rogers, CAMEO Founder

CAMEO is celebrating our 20th Anniversary at our Annual Meeting on June 17th in Sacramento! This year, we’re taking the opportunity to honor our founders, including Sheilah Rogers. Visit the 20th Anniversary page for this years agenda and more information on other speakers and award recipients.

sheilah rogers photo (large)

Sheilah Rogers is a pioneer in international and domestic microenterprise development. As a Peace Corps volunteer, she worked with rural women in Ecuador to build a marketing cooperative that recognized their artistic talents and established new domestic and international markets for their artisan products.

Sheilah is the founding CEO of West Company in Mendocino County, one of the first domestic microenterprise development organizations that focused on low- income women’s economic challenges and their paths to social and economic well-being.

As the leader of West Company, she participated in national initiatives to achieve best practices to bring disenfranchised women into the economy and to advocate for public policies that support their entrepreneurship. She counts 30 years of leadership and advocacy for microenterprise as the sustainable economic development strategy for rural economies.

She is a founder and former board member of CAMEO, the California Association for MicroEnterprise Opportunity and AEO, the Association for Enterprise Opportunity. Sheilah holds a Masters Degree in International Development from the School for International Training in Brattleboro, Vermont.

In retirement, Sheilah has focused on one of the Six Targets of Opportunity for economic growth on the North Coast – Specialty Agriculture, Food and Beverage including producers, value added manufacturers, distributors, local vendors. She currently serves on the Mendocino County Food Policy Council, the North Coast Regional Food Systems Network and the Mendocino College Culinary Arts Advisory Committee. Each of these efforts is working to build a sustainable local food system that reduces hunger, increases healthy eating and expands economic vitality.

Research: In Search of Solid Ground

Full_Report_CoverNew Research Broadens Understandings of Microbusiness Financial Vulnerability

Though micro-businesses contribute significantly to nationwide economic activity and their owners’ household balance sheets, many still struggle to make ends meet or build long-term wealth. Today, little is known about how the typical micro-business manages its finances, the major financial challenges they face or which components of financial capability lead them to business success. To begin to bridge this gap in understanding, CFED released a groundbreaking new study titled In Search of Solid Ground: Understanding the Financial Vulnerabilities of Microbusiness Owners.

With support from MasterCard’s Center for Inclusive Growth, CFED launched the study in 2013, surveying 716 micro-business owners from 43 states and conducting phone interviews with 214 owners from two target markets: Miami and Minneapolis. The findings reveal that micro-business owners’ business and personal finances are often inextricably tied, and that they are dealing with significant financial vulnerabilities that reach far beyond access to credit. Among the main findings:

  • Cash flow problems—lacking sufficient liquidity to cover business expenses at the time they arise—are key drivers of financial insecurity for both micro-business owners and their households.
  • Remarkably low short- and long-term savings levels compound these challenges even further, preventing micro-business owners from mitigating income-expense mismatches, weathering emergencies or meeting long-term goals that contribute to greater financial stability.
  • Difficulty accessing appropriate financial products and services, especially credit, also compounds micro-business owners’ financial security: those that are vulnerable for other reasons—young startups, less formal businesses, those generating lower household incomes for their owners, those with fewer employees and minority-owned businesses—are more likely to experience difficulty accessing financial products that suit their needs.

The study’s findings help tell a more nuanced story about what constitutes financial capability and offer new insights into the types of solutions that might resolve micro-businesses’ greatest financial challenges. Going forward, CFED will engage partners in a national dialogue focused on moving from research to action. We hope you will accept CFED’s invitation to stay engaged!

Download the research study and brief from CFED’s Resource Directory today!

Questions? Contact Lauren Williams or Manny Hidalgo.

Healthcare Reform and Small Biz

What Healthcare Reform Means for your Micro-Business

Health care continues to be an important issue for small business owners. The Small Business Administration and Small Business Majority are committed to helping businesses navigate the changes and opportunities in health care through the Affordable Care Act 101 webinar series.

Small business owners can learn the basics of the Affordable Care Act and how they can enroll in small business health insurance marketplaces. Other topics discussed include insurance reforms, the small business health care tax credit, and employer shared responsibility provisions. SBA representatives help small business owners understand the facts of the Affordable Care Act so they can make informed decisions about providing health insurance for their employees.

What the Healthcare Law Means for your California Small Business

English 

Spanish

Learn more about how the new health care law affects small businesses.

For more information visit Covered California.

MicroLending Academy Newsletter V1.1

MLAcademy PencilMicrolending Academy Newsletter

Inaugural Edition Collectors Item – Read it. Print it. Save it. Frame it!

 

Hi Friend,We’ve developed a new newsletter that will be chock-a-block with articles, resources, technology, success stories, interviews, big picture ideas on all Lending Academy features.  We’re starting with once a quarter and will increase the frequency as demand dictates.  Welcome to our first edition!

In this Issue…

  • MMS Update – Microlending on the Rise for Three Orgs
  • News: Proposed Rule Changes to Microloan TA Program
  • Best Practices:  Deployment of Capital from OFN
  • Peer Learning:Developing New Loan Products
  • Training Opportunities

Peer Learning: Developing a New Loan Product

microbiz peer callPeer learning calls will provide a forum in which you will work with colleagues to strengthen your microloan program and share your insights and innovations. Jeremy Hofer of Fresno CDFI will lead our inaugural peer learning call about the strategic approach to developing a new loan product.

April 7, 2014

11:00am-12:00pm

RSVP today for the MicroLending Academy Peer Call: Strategic Approach to Developing a New Loan Product to receive the call-in information.

Technology: MMS Update – Microlending on the Rise for Three Orgs

Devon Johnson, WEV In the first eight months of the MMS pilot, the program has received 160 loan applications, rejected 107 and approved 32 for an approval rate of 20%. The program has lent $656,000; we hope to reach $1 million in the first year.

Susan Brown, the program manager, spoke with Devon Johnson of Women’s Economic Ventures about her success and hopes for the program.

Contact Susan Brown to learn more about how to increase your loan volume!

News

 

Best Practices:  Deployment of Capital

OFN has a new technical assistance memo out – Deployment Strategies for CDFI Small Business Lenders

CDFIs of all shapes and sizes have developed a variety of ways to overcome barriers to deployment – barriers such as lack of quality deals, insufficient staff capacity, competition, lack of a marketing budget, and insufficient capital.

This memo outlines common strategies for over coming barriers, including development and maintenance of referral relationships, creative marketing strategies, deployment goals, specialization in lending, and capitalization planning. But the real take away is that to increase effectiveness a CDFI needs clearly stated deployment goals and integrated strategies that link capitalization, marketing, and deployment into a cohesive and measurable management approach.

Study the Deployment Strategies for CDFI Small Business Lenders Memo.

Training Opportunities: Certificate in Community Development Finance

microbusiness trainingCAMEO’s Individualized Learning Program for Trainings and Professional Development can be used to partially defray trainings, workshops and events that help develop leadership and improve operations of our member organizations.

Opportunity Finance Network offers a certificate in Community Development Finance on June 16, 2014 – June 20, 2014 in New Hampshire. The program fee is $2,200.

Learn more on how to access this member benefit as well as other training opportunities.

 

20th-anniversary-CAMEO- 4c-vertical-small

CAMEO, as the effective small business CDFI coalition for California, supports the growth and sustainability of microlending in California. We feel that it’s our role to bring forth new trends and technology and to support our members to expand their capacity, skills, capital resources and technology adoption. To that end, we introduced a new program at our 2014 MicroLenders Forum – MicroLending Academy.

 

 

OUR GOALS

  • Significantly increase microlending among our members.
  • Assist members to increase capacity and knowledge of best practices.
  • Showcase and support the adoption of technology for operations efficiency and loan production.
  • Promote access to capital for disadvantaged entrepreneurs.

UPCOMING EVENTS

What would you like to see in the newsletter? Do you have a best practice or success story to share? Email Heidi Pickman with your content ideas.

House Approps on SBA FY2015 Budget

This from our guy in DC, Martin Feeney of Madison Services Group.

On April 3, the House Appropriations Subcommittee on Financial Services and General Government met to consider the President’s FY2015 proposed budget for the Small Business Administration (SBA). Acting Administrator Marianne O’Brien Markowitz testified on behalf of the SBA.

The purpose of this hearing was to review the President’s $865 million funding recommendation for the SBA, as the Subcommittee begins to draft the FY2015 SBA spending bill. The FY2015 request is a decrease of $64 million from current FY2014 funding.

In his opening remarks, Chair Ander Crenshaw (R-FL) highlighted the importance of the SBA’s Women’s Business Center (WBC) program, and noted that the WBC in his District, the Jacksonville Women’s Business Center was recently recognized by the SBA for outstanding performance.

Ranking Member Jose Serrano (D-NY) said one of his primary concerns with the proposed budget was the elimination of the PRIME program, saying that he and his colleagues will once again fight to reinstate funding for the program.

Topics covered during the hearing included:

  • Focus on high-growth businesses: Chair Crenshaw noted that there seems to be more focus on assisting businesses poised for growth rather than assisting true small businesses; he asked the SBA ensure the needs of entrepreneurs are being met.
  • Microloan: both Chair Crenshaw and Ranking Member Serrano emphasized the importance of the Microloan program and support the SBA’s recommendation for full funding for the program.
  • PRIME: As noted, Ranking Member Serrano repeatedly noted the SBA’s lack of support for the PRIME program, asking the Administration to better articulate why the continue to propose eliminating it. SBA Acting Administrator O’Brien Markowitz noted her familiarity with the program and the benefits it provides from her time as a regional SBA director, saying “I know the good the program does.”
  • Disaster preparedness: all Members gave the SBA high marks for its disaster efforts and recognized the SBA’s efforts to enhance disaster responses, including new lending approval processes for disaster loans.
  • Agency-wide efficiency: the SBA has successfully reduced administrative costs by better managing fleet services, consolidated office space.

How ACA Enrollment Affects You

Thanks to John Stanford of Madison Services Group for this article.

Individual Health Insurance Enrollment Has Ended – How It Affects You

March 31st marked the end of “open enrollment” in the new Health Insurance Exchanges for 2014. For most Americans, this signaled the final day to create an account, compare plans, and choose health insurance for 2014. Amid the many updates, delays, and conflicting media coverage, business owners and their employees may not know how they are affected. Depending on your current insurance situation, here are actions you may need to take:

For Individuals Not Covered Through Work:

  • If you had technical problems signing up, either through the federal exchange at healthcare.gov or certain state exchanges (at this point Maryland, Minnesota, and Nevada), the enrollment period has been extended until mid-April. To qualify for this extension, you must have created an account on the exchange (including your email address) by midnight yesterday.
  • If your insurance was cancelled and will end at some point in 2014, you will be able to sign up during a “special enrollment period” — right before your plan ends. Alternatively, your insurance carrier may choose to extend your plan as-is. Check with your current carrier to find out.
  • If you are self-employed, you are considered an individual, not a small business. Your enrollment period ended yesterday, just like everyone else.

For Small Business Owners

  • If you are a business owner and planned to offer insurance through your business to your employees, you can enroll throughout the year in the SHOP (Small Business) Marketplace. Generally, you can enroll up to the 15th of any month for coverage beginning the 1st of the next month. The Small Business Marketplace is limited to business with up to 50 employees. Online applications will not be available until the fall, though you can apply for coverage through a paper application or broker, both accessible through healthcare.gov.
  • If you already provide health insurance to your employees (under 25 employees), make sure you consider the Small Business Health Tax Credit which can cover up to 50% of your costs. The credit is available for 2013 (the taxes being filed in April this year). Use the IRS Taxpayer Advocate calculator to determine if you qualify and for how much.

As a reminder, there are no penalties for any employer until 2015, no matter how many employees you have.

Summary of Proposed Microloan Program Changes

Thanks to Martin Feeney of Madison Services Group for this summary.

1) Revision Regarding Insured Depositary Institutions
The proposed rule would allow microloan intermediaries to maintain their Microloan Revolving Funds (MRFs) and Lon Loss Reserve Funds (LLRFs) in federal insured credit unions. The current definition specifies only insured banks and savings associations.

2) Removal of Interest Bearing Account Requirements
The proposed rule would remove the requirement that the Microloan Revolving Fund (MRF) and the Loan Loss Reserve Fund (LLRF) be held in interest-bearing Deposit Accounts.

3) Borrower Eligibility Expansion
The proposed rule would allow microloan intermediaries to make loans to businesses with an Associate (as defined in § 120.10) who is currently on probation or parole. Individuals who are currently incarcerated or under indictment would remain ineligible for a microloan, as would individuals who are on probation or parole for an offense involving fraud or dishonesty.

4) Increase in Minimum Loan Requirements
The proposed rule would update § 120.716; gradually increasing the minimum number of loans a microloan intermediary must make each fiscal year to twelve. Currently, intermediaries must make a minimum of four microloans to remain in the program. The proposed rule would require intermediaries to make a minimum of:

Six loans in FY2015
Eight loans in FY2016
Twelve loans in FY2017 and thereafter.

The proposed rule would also update § 120.716 to specifically state that intermediaries that do not meet the minimum loan requirement are not eligible to receive new grant funding for management and technical assistance. An intermediary that is ineligible for a grant due to failure to make the minimum number of microloans in the previous Federal fiscal year may become eligible for grant funding the following year by meeting the minimum number of loans for the current year.

Additional Resources:

Federal Register Proposed Rules Publication (March 17, 2014)
Microloan Program Standard Operating Procedure (SOP 52 00)
Microloan Program Overview and Eligibility Requirements
Participating Microloan Intermediaries

MMS 8 Month Update

CAMEO brought Accion Texas’s Microloan Management System to its members as a way to decrease the cost of microlending. Three members are active in the pilot: CDC Small Business Development, TMC Development Working Solutions and Women’s Economic Ventures.

In the first eight months of the MMS pilot, the program has received 160 loan applications, rejected 107 and approved 32 for an approval rate of 20%. The program has lent $656,000; we hope to reach $1 million in the first year.

Susan Brown, the program manager, spoke with Devon Johnson of Women’s Economic Ventures about her experience.

Devon Johnson, WEVDevon has been, until very recently, WEV’s one-person microlending shop serving Santa Barbara and Ventura Counties. For the past couple of years Devon has closed about 20 micro deals per year, lending about $300,000 for an average loan size of $15,000. That was the limit of what she could handle on her own.

When the opportunity to try Accion Texas’ MMS program came along, she was open to the possibilities of expanding volume – almost like hiring another person for a fraction of the cost.

And that’s turned out to be true.

Because MMS’ Auto Review gives instant feedback on applications, she doesn’t waste time on unqualified deals. With eligible deals, she has cut her processing time in half, which quickly enabled her to double the number she could handle at one time. MMS also provides a rigorous structure for her and her clients, allowing her to make quick, quality decisions and give clients specific feedback on their application.

Her use of MMS has paid off. In the first year Devon has been able to loan nearly $500,000.
“The way it was done in the past — with loan officers chained to a desk — it’s not the best model,” said Devon. “MMS leaves me with more in-the-field time for presentations, relationship building with referral partners and connecting to the community.”

Devon produced quick results because she was willing to immerse herself in the MMS process and study the underwriting approach diligently. She also conferred with Accion Texas’ underwriting team, to give them what they needed for fast turnaround.

Where does Devon plan to go in the next two years with MMS? “In two years we should be able loan close to $800,000 with an loan average of $15,000 to $20,000,” said Devon. She recently hired a junior loan officer to help her meet that goal.