How Colleges And Universities Can Accelerate Small-Business Investment

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President/CEO of Joseph’s Premier Real Estate; professor of finance, business, real estate at IRSC; author of Madness, Miracles, Millions.

It’s not rocket science, but small-business owners need capital now more than ever. Due to the Covid-19 pandemic, millions of small businesses have closed their doors for good. Many of the survivors are struggling to stay afloat, let alone creating jobs or expanding their operations.

While vaccine distribution shines a light at the end of the Covid-19 tunnel, small-business owners are not out of the woods yet. In truth, it will take months and even years for the small-business community to fully recover from the pandemic recession. There is no on-off switch for the U.S. economy. Based on personal experience, it takes an inordinate amount of time and effort to start and successfully run a small enterprise. And, based on conversations with other entrepreneurs, the economy is unlikely to fully recover in 2021.

Many small businesses are suffering.

The numbers back up this assertion. According to a recent Small Business Majority poll, four in 10 small business owners have not obtained any capital from a lending institution, or even friends and family. According to the same poll, only 30% of small businesses have applied for direct relief from the Paycheck Protection Program (PPP), while only a third of those who applied received the full amount of funding requested. While PPP funding is one piece of the puzzle, it is not enough.

Be unconventional and creative.

My first piece of advice to small-business owners who are at the fundraising stage is to exhaust all of your options. Reliance on the federal government may help in the short-term, but overreliance is not a viable long-term strategy for sustainable growth. Keeping all of your eggs in the government basket may stop you from failing now, but it will not lead you to success in the future.

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My second piece of advice is to be unconventional. Be creative. Think outside the box, even if it seems “crazy.” When it comes to fundraising, many small-business owners think of the Small Business Administration or a wealthy individual in their personal orbit. And those are valuable options: Despite struggling financially at the time, my parents helped me start my first small business, and I am forever indebted to them. However, they are not the only options.

Don’t underestimate the power of academia.

This brings me to my last piece of advice: Don’t underestimate the power of academia. Today, colleges and universities are increasingly involved with small businesses, helping them launch and steering them through the early days with key resources. More importantly, they are invested in small businesses, offering seed money in exchange for an equity stake.

At Indian River State College (IRSC), where I serve as a professor of finance, business and real estate, President Timothy Moore and Dean Prashanth Pilly run academics like a business. Our curriculum is bottom-line oriented, with the primary objective to prepare students for the real world. With that in mind, IRSC recently hopped on the bandwagon of small-business investment, offering resources to aspiring entrepreneurs for equity. If an entrepreneur wishes to start a business or develop a new product, the school will help out with fundraising, marketing and other services to get from Point A to Point B.

Consider a specialized business certificate.

What’s more, IRSC is now offering business certificates to a wide range of students, as they complete their degrees. Even small-business owners who do not need a degree can benefit from the certificates, as they are state-recognized. With many industries requiring specific certificates to enter and advance, IRSC is one of many schools that assists potential entrepreneurs beyond the traditional coursework.

Of course, we are not alone. Academia has long played a role in small business investment. Schools like the California Institute of Technology and New Mexico State University (my alma mater) are well-known for their business incubators, where entrepreneurs can seek help to launch successful start-ups. But academia’s role is becoming more pivotal, especially due to the financial hardship inflicted by the Covid-19 pandemic.

If you’re a small-business owner in need of financial assistance, stay optimistic. Stay the course. Remember: Knock on every door. If one closes, another will open.

Perhaps your next door will even lead you to a classroom.


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