The setting was rather standard for a Washington event — a large room inside a government building, complete with a stage and an ornate lectern along one wall. However, no one stepped on stage. No one spoke at the lectern.
Instead of the semi-scripted panel discussions and question-and-answer sessions you might expect here, a dozen business leaders sat facing one another at three long tables, often interrupting one another with new ideas, tangents and critiques. Instead of a PowerPoint presentation on drop-down monitors, a pair of oversize note pads rested on easels in the center of the room, each bearing sheet upon sheet of marker-scribbled notes.
The conversation didn’t stick to a schedule, and there wasn’t a social media hashtag tied to the discussion. In other words, it wasn’t very Washington. It looked and felt more like a brainstorming session you might see at an innovative company, not at a federal agency.
And that’s exactly what the Small Business Administration had in mind.
“We like to say this is the new SBA,” said Miguel Ayala, an agency staffer and one of the attendees at the event last week at the agency’s headquarters in the District. The gathering brought together leaders from start-up incubators and economic development groups across the country to discuss ways to build better “accelerator” programs for growing companies.
At a time when the 60-year-old agency faces skepticism about its ability to stay relevant in the rapidly evolving, highly innovative world of entrepreneurship, one meeting hardly represents a seismic strategic or cultural shift, and it certainly won’t eliminate concerns about the agency’s future. Still, under SBA Administrator Maria Contreras-Sweet, who took office this spring, the agency seems keenly aware of its rather “old-fashioned” reputation, and it’s working with a sense of urgency to modernize its operations and rethink its role.
“I think every day about our relevance going forward,” Contreras-Sweet said during an unexpected stop into the meeting, in which rather than delivering a speech she simply answered questions from the group. “We have to understand what we are good at and where have opportunities to improve.”
Chief among the agency’s challenges will be staying relevant in the commercial lending space, as backing small-business loans has long been the centerpiece of the department’s support services. However, with the introduction of newer and faster lending platforms, coupled with the introduction of online crowdfunding platforms, cash-strapped small businesses that may have once been limited to SBA-backed loans now have a plethora of alternatives at their fingertips.
In many cases, Contreras-Sweet acknowledged during her drop-by, the answer for SBA isn’t to build tools that keep pace with those new-age, tech-heavy platforms (a likely futile ambition). Instead, rather than trying to be the solution, “we just need to know about the solutions so we can point entrepreneurs to them,” she said.
While the agency continues to try to streamline and bring its loan application processes online, it will in part be that expertise, she said, and the ability to steer business owners to the right resources, even if they aren’t SBA resources, that will help the department maintain its reputation as a go-to source for entrepreneurs in need of financing.
In addition, Contreras-Sweet said the agency has started leaning more heavily on the advice of private-sector business leaders and entrepreneurs — including those at the event this week, who represented organizations that received funding through the department’s new Scale Up America program. Under the initiative, private- and public-sector organizations can apply for grants to finance assistance programs specifically for companies ready to grow beyond the start-up stage.
In building the program, SBA officials broke from the mold a bit. Instead of writing all the rules and guidelines for the initiative in advance, they sketched out a rough outline and some overall objectives, selected eight first-year recipients, and invited the recipients in to help craft the program from the ground up.
During their brainstorming session, the participants — who hailed from Tucson; Portland, Ore.; Jacksonville, Fla.; and points in between — discussed various ways to solicit help from investors and business mentors in their communities. Later, they shared their tips for luring entrepreneurs, attracting media attention and roping in government leaders.
“This is the day where we’re bouncing ideas around, breaking into groups, looking at the best way to do this and the best way to do that,” Greg Teesdale, one of the participants from the Startup Tucson organization, said during a break, noting that not all events work this way. “I’m actually writing things down here, saying ‘Okay, that’s something we haven’t done, and there’s something we should change.’”
Teesdale and others also shared with Contreras-Sweet some policy suggestions that they said could grease the wheels for fast-growing companies. For example, Teesdale urged her to advocate for tax reforms that reward individual start-up (or angel) investing.
“We’re here to learn,” Contreras-Sweet said. “We have brilliant people inside the SBA, but we learn the most when we talk to outside people, in conversations like this.”