SBA lending and mentoring fuel growth for Wisconsin small businesses

On Tuesday night, Americans saw Colorado sub shop owner Carolyn Reed at the State of the Union address, representing America’s small businesses and their importance in driving the economic recovery.

Only two years ago, Wisconsin’s Deb Carey occupied that seat. Deb and her husband started New Glarus Brewing Company in New Glarus, Wisconsin in 1993. They relied on SBA counseling to get the business started, and they grew the business with SBA guaranteed lending to buy their first warehouse. Today, they employ 50 people and are the number one micro-brewery in Wisconsin by sales volume.

Deb Carey’s story is the story of thousands of small Wisconsin companies helped by SBA-guaranteed loans and counseling that contribute to Wisconsin’s economic growth. Since 2009, SBA has guaranteed more than 11,000 loans to Badger State small businesses totaling $3.5 billion. These businesses reported retaining more than 99,000 jobs and creating nearly 33,000 more — all during the Great Recession.

In 2014 alone, Wisconsin banks guaranteed 1674 loans for $542 million. Of these, 534 went to new businesses who most likely would not have received financing without SBA’s guarantee. They now have the precious chance to create jobs and spend money building their businesses, contributing to economic prosperity for their communities. From 2009 to 2014, new businesses financed with SBA loans in Wisconsin reported creating nearly 13,000 new jobs — jobs which would not have existed without these loans.

Last year, SBA sought to make funds more accessible than ever by eliminating fees on loans $150,000 and under. This strategy benefits the small, main-street businesses that make up the fabric of our state. More than 800 Wisconsin firms saved $950 in fees on average with savings totally over $700,000 for borrowers. For example, Milwaukee’s Purple Door Ice Cream Shoppe used an SBA Community Advantage loan, offered through community-based lenders, to expand into a new space in Milwaukee’s urban, low-income Walker’s Point neighborhood. They saved on fees and created twelve jobs. And they are not alone – Wisconsin is a national leader in SBA small loans for the second year running.

While lending dollars can help businesses pay for expansion, SBA’s research shows that mentoring and counselling help businesses hire more employees and generate more revenues. SBA Wisconsin’s partners in counselling, including seven SCORE chapters, twelve Small Business Development Centers, and six Women’s Business Center offices statewide. They counsel thousands of businesses and business owners-to-be each year. For instance, Stacy Nellen-Kolze worked extensively with the SBDC in Green Bay starting in 2009 to develop her business plan. Today her shop, Nell’s Wigs, provides wigs, mastectomy products, and other services. With the SBDC’s ongoing mentorship, Stacy recently accomplished her latest goal of getting her products and services accepted by health insurance companies. Purple Door Ice Cream Shoppe, mentioned above, started as a counselling client of Wisconsin Women’s Business Initiative Corporation (WWBIC), the Women’s Business Center based in Milwaukee and an SBA micro-lender as well. Other counselling clients have taken their businesses from startup to major growth — for example, Enterforce, an engineering staffing firm started in 2001 with SCORE’s counselling assistance, now employs 248 people with $75 million in revenues.

These are just a few of the ways that the U.S. Small Business Administration is helping Wisconsin’s main street businesses. There are thousands of entrepreneurs — in Milwaukee, in Sarona, in La Crosse, in Hudson, in Madison and in many other communities that could tell similar stories of how they contribute to Wisconsin’s economic growth with SBA’s help. Every day, our office is here to help your business start, grow, and succeed. Don’t hesitate to reach out to me at eric.ness@sba.gov or learn more at www.sba.gov/wi.

Eric Ness is the Wisconsin district director of the U.S. Small Business Administration.

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