What Can the Obama Administration do to Help Small Businesses?

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August 4, 2009 by Amanda | Comments (0)

Entreprenesses undoubtedly face a unique set of challenges, and often run different types of businesses than our male counterparts. What can the Obama administration and Congress do to help? Check out this thought provoking article from The Wall Street Journal.

1. Re-evaluate small business administration lending programs
Many women don’t significantly grow their operations beyond a few employees for family and lifestyle reasons. This makes it extra difficult for these businesses to secure post-start-up capital, especially when compared to male business owners with aggressive growth plans. NWBC recommends adapting SBA-backed lending programs to make growth capital more accessible to women, including: offering “stage-based” loans that provide money to businesses based on the stage of development; extending credit lines once start-up loans are paid off; allowing accounts receivable to be pledged as collateral and aligning women business owners with “patient capital” investors who don’t require immediate or fast repayment.

2. Give tax credits to angel investors
Women-owned businesses can benefit greatly from angel investors, affluent individuals who invest in small businesses but don’t demand the same size and growth aspirations of venture capitalists. Congress should seriously consider a bill that would provide tax credits to angel investors.

3. Create tax incentives for improving employees’ experience.
Many women business owners want to offer programs such as child-care assistance, good health benefits and wellness programs that improve employees’ lives. They would like tax incentives to offer these types of programs.

4) Ensure women-owned businesses win at least 5% of federal contracts
A 2000-passed law mandates that federal agencies must dole out 5% of all federal contracts to women-owned businesses. NWBC says its members “overwhelmingly” support that rule and want to see it enforced (which it hasn’t been). Also set up a federal contracting clearinghouse just for women. Many women entrepreneurs don’t try for contracts because finding opportunities and pursuing them is so complicated. The government should set up a special Web site that lists contracting set-asides just for women-owned businesses along with resources on topics, such as how women can apply for 8(a) certification.

5. Increase funding for federal entrepreneurs’ support organizations, such as Women’s Business Centers and SCORE
Many women rely on these federally funded programs and business incubators for help. Also offer more outreach to women entrepreneurs and mentoring opportunities.

6. Ease costs and regulations for “microbusinesses.”
Since many women do run businesses with very few employees—and often from their homes—the government should consider how it can assist these businesses. Among suggestions: Amend the home-office deduction to make it more attractive, get rid of self-employment tax for firms without employees, expand micro-lending through the SBA and provide federal contracting set-asides just for microbusinesses.

Readers, what do you think of these recommendations? Should the government do more to help women entrepreneurs?

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