Small Business and SBA 504 News Brief From Liberty SBF

June 12, 2015

It takes six days on average to start a business in the United States and it takes less than one in New Zealand. That’s the takeaway from a new chart posted by the White House Blog. The post, written by Tanya Somanader, Deputy Director of Digital Content, says that “When it comes to ease of doing business, America is top 10 in the world. But when it comes to starting a business, we’re ranked 46th.” Red tape is the burden of the entrepreneur trying to be nimble in a business world that operates at the speed of the Internet. The Obama administration said that it is working to make it faster to start a business in the U.S.

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The first step to speed up the process is the Startup in a Day Initiative announced by the White House and the SBA in coordination with the National League of Cities. According to a statement released by the SBA, the initiative will make easier for entrepreneurs to start a business by reducing the amount of time it takes to register and apply for permits and licenses on the local level by developing online tools that let entrepreneurs discover and apply—in less than a day—for local, state, and federal requirements needed to start a business.

The SBA 504 program gets some love from the beer industry. Craft breweries are popping up everywhere and if you savor suds this is making you a happy customer. In a paper published this month by a Food and Beverage Attorney group the firm discusses the financing options for startup breweries, including the SBA 504 program. “Finding a funding source is often one of the primary challenges faced by new breweries and brewpubs,” the paper says. Since new ventures often don’t have the cash flow or assets to get a traditional bank loan, the firm suggests that entrepreneurs look to the SBA for help. “There are several SBA loan programs, each with its own limitations and qualification requirements. In each case the lender will not be the SBA directly, but instead will be another institution, with the SBA providing credit support to the lender. The two most common types of SBA loan programs are known as CDC/504 loans and 7(a) loans.”

TMC Financing, a CDC serving Northern California and Nevada announced that it helped new owners loan purchase the iconic Russian River landmark Johnsons Beach Resort in Guerneville, California for $2.5 million with a 20-year, fixed-rate SBA 504 loan. Nick Moore and Dan Poirier are only the fourth family in nearly 100 years to own the campground and recreational property. “The most appealing thing about the SBA loan was the fixed rate,” Poirier said. “We both have a background in financial services and we can’t imagine rates will stay this low forever. Locking down the rate for 20 years was something we couldn’t pass up.” Founded in 1981, TMC Financing consistently ranks among the top CDCs nationwide, funding projects worth more than $8 billion across California and Nevada.