Almost half of the country’s small businesses were unable to secure loans to help them grow in 2011 – an alarming statistic considering that small businesses account for an overwhelming percentage of jobs.
Rep. Diana DeGette (D-Colo.) of Colorado’s First Congressional District said small businesses need greater support, prompting her to host an “Access to Capital” forum at the University of Colorado Denver this morning. The forum included business professionals and small business owners who shared best practices on securing loans, creating business plans and strong business foundations.
DeGette and her co-host, Dean Sueann Ambron of the CU Denver Business School, thanked the audience of about 60 for braving the snowy weather to attend.
In introductory remarks, Ambron called DeGette a strong advocate for business interests and invited all attendees to take a tour of the newly renovated Business School on Lawrence Street after the forum.
“We will now have a home for small-business students, large-business students and faculty right here in downtown Denver,” Ambron said. “Our Business School’s goal is to grow businesses, so we have the same objective as you.”
DeGette said that fostering small business is the key to revitalizing the economy and reducing unemployment. She said 45 percent of small businesses seeking loans last year were unable to find sufficient financing.
“About half of our state workforce is employed by small business,” DeGette said. “As recently as 2007, over 95 percent of the employers in Colorado were small businesses. So it’s really important that we nurture them. But we can’t do that without helping them to raise the capital they need.”
The forum consisted of two panels. The first group included organizations that help small businesses formulate business plans and secure funding as well as a couple of small business owners. The second panel included lenders and lending resources organizations.
Virginia McAllister, principal and founder of Iron Horse Architects in Denver and a former adjunct instructor for the CU Denver College of Architecture and Planning, shared a story of how her business evolved. It grew from a single employee at the low-point of the recession in 2009 to its current 20-employee operation that has grown 400 percent since 2010.
Her business learned the hard way that a credit line must be established immediately, so that a banking relationship already exists when the business needs money to expand. Because it hadn’t kept a line of credit open, Iron Horse struggled to find a lender to cover increased payroll when the company landed a large contract.
“It took us nine banks to find one bank that would loan to us,” McAllister said. “One of the biggest reasons was because we hadn’t borrowed money from anyone.”
DeGette noted that her website – Rep. Diana DeGette – has been upgraded to include a portal that provides information about small businesses and jobs. The site will include information about financing and other pertinent issues for small business owners.
“It seems to me the No. 1 issue we need to deal with right now in this congressional district and in this country is jobs,” DeGette said.