1 Answers | Resources | SupportFor Your Small Business Welcome – Smile! SBA offers a wide variety of programs and services. Our office is here to serve the small business community. SBA offers programs to support the diverse needs of small business owners. From this page you can access information on programs related to technical, financial, contracting, education and disaster assistance, as well as special interests, advocacy and civil rights compliance. Financial Assistance All businesses require money to get off the ground and to continue to grow. SBA's resources help you research loan programs, explore options around export financing, learn more about Small Business Investment Companies (SBICs), and ... Small Business Audiences SBA has programs and resources for everyone, regardless of age, gender, race, and financial status. Explore the options to find out how SBA can help you turn your business idea into a viable enterprise or expand your current business for ... Counseling & Training Every business owner needs guidance during the start up and running of their business. SBA’s Office of Entrepreneurial Development helps businesses start, grow and compete in global markets by providing quality training, counseling and ... Contracting Working with the federal government can provide many opportunities to small businesses. To help business owners work effectively with government, the Office of Government and General Contracting works with Government Contracting and Business ... Disaster Assistance Disasters can wipe out a small business in seconds. To help protect small business owners, SBA’s Office of Disaster Assistance (ODA) provides affordable, timely and accessible financial assistance to homeowners, renters, and businesses. ... Advocacy, Laws & Regulations Giving small business owners a voice early in the legislative process is key to reducing the negative impact of regulations on small businesses, increasing the level of regulatory compliance, and passing on cost savings to state economies. ... Initiatives SBA is committed to helping small businesses in the US succeed. As such, several programs and laws have been sponsored that directly affect small business owners. Here, you can learn more about how legislation such as the Small Business ... Civil Rights Compliance - CRC The Office of Civil Rights Compliance (OCRC) works to ensure compliance with nondiscrimination rules and regulations by SBA recipients of general financial assistance and, with regard to individuals with disabilities, SBA programs and program ... U.S. Small Business Administration Answers | Resources | Support For Your Small Business

2 Types of Assistance Access to CapitalCounseling / Entrepreneurial Development Contracting / Procurement Assistance Counseling Credit Contracting Access to Capital (Business Financing) SBA provides small businesses with an array of financing for small businesses from the smallest needs in microlending --- to substantial debt and equity investment capital (venture capital). Entrepreneurial Development (Education, Information, Technical Assistance & Training) SBA provides free individual face-to-face, and internet counseling for small businesses, and low-cost training to nascent entrepreneurs and established small businesses in over 1,800 locations throughout the United States and US territories. Government Contracting (Federal Procurement) In keeping with the mandate of Section SBA has grown significantly in terms of total assistance provided and its array of programs have been tailored to encourage small enterprises in all areas. SBA's programs now include financial and federal contract procurement assistance, management assistance, and specialized outreach to women, minorities and armed forces veterans. SBA also provides loans to victims of natural disasters and specialized advice and assistance in international trade.

3 Trends and Concerns Technology Available research dataGreater sub-contracting opportunities Green Senior services Intense competition Fickle customers Bank funding issues Good employees hard to find Liability Good employees – Training is important and a feeling of stability – Pay is $22 / hour at some restaurants Liability – Story about producing flour – need a bug crusher – centrifuge which spins so fast, it crushes any eggs in the flour magnet to get out any metal in the flour Internet – Use notes – Latest data shows 2,095,006,005 internet users in the world with penetration of 30.2 % of the world wide population. Growth world wide in internet use since 2000 is up 480.4% Source Internet world stats.com

4 Options for Starting UpBuy an existing business Ground work has already completed Proven performance over time Room for improvement? Start a business from scratch New market/product New twist on existing market/product Opportunity to create a value surplus Open a franchise small business Marketing and product/service research done for you Templates for business plan, financials, assets

5 Home Based Business Advantages Convenient work location Less expensiveFlexible schedule Utilize available space Tax Advantages Disadvantages Zoning or deed restrictions Isolation from others Difficult financing Family distractions IRS scrutiny It’s a good idea to set up an office in the home, not only to minimize distractions, but to justify the home business write-offs with the IRS. Some people struggle with feeling lonely when working at home. You can make up for this by getting involved in your local community, attending chamber of commerce mixers, volunteering, etc.

6 Financing Programs SBA Loan Guaranty Programs 7(a) Loan ProgramMicroloans CDC/504 Program SBA Direct Disaster Loans SBA Grants Not available for starting/expanding Limited grants for research, development & innovation Small Business Innovation Research (SBIR) Small Business Technology Transfer (STTR) STEP Grant – ND Trade Office - Exporting Accelerator Grant – UND Center for Innovation SBA Loan Programs Financing your business requires research to find the most appropriate funding model. SBA offers a variety of loan programs for very specific purposes. The 7(a) Loan Program is the SBA’s primary program to help start-up and existing small businesses obtain financing when they might not be eligible for business loans through normal lending channels. The name comes from section 7(a) of the Small Business Act, which authorizes the SBA to provide business loans to American small businesses. The SBA itself does not make loans, but rather guarantees a portion of loans made and administered by commercial lending institutions. 7(a) loans are the most basic and most commonly used type of loans. They are also the most flexible, since financing can be guaranteed for a variety of general business purposes, including working capital, machinery and equipment, furniture and fixtures, land and building (including purchase, renovation and new construction), leasehold improvements, and debt refinancing Loan maturity is up to 10 years for working capital and generally up to 25 years for fixed assets. Most banks and credit unions participate in the program, The lender and the SBA share the risk that a borrower will not be able to repay the loan in full. The guaranty is against payment default; it does not cover imprudent decisions by the lender or misrepresentation by the borrower. The Microloan Program provides small, short-term loans (up to $50,000) to small business concerns and certain types of not-for-profit child-care centers. The SBA makes funds available to specially designated intermediary lenders, which are nonprofits such as Lake Agassiz Regional Development out of Fargo who provides loans to business throughout North Dakota. The 504 loan program is a long-term financing tool, designed to encourage economic development within a community. The 504 Program accomplishes this by providing small businesses with long-term, fixed-rate financing to acquire major fixed assets. SBA Direct Disaster Loans - SBA provides low-interest disaster loans to homeowners, renters, businesses of all sizes, and most private nonprofit organizations. SBA disaster loans can be used to repair or replace the following items damaged or destroyed in a declared disaster: real estate, personal property, machinery and equipment, and inventory and business assets. Grants- Unlike business loans, grants have the advantage of not having to be repaid. However, grant funding is generally restricted to very specific audiences If your small business is engaged in scientific research and development (R&D), you may qualify for federal grants under the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs. SBIR and STTR programs encourage small businesses to undertake R&D projects that: Meet federal R&D objectives Have high potential for commercialization These are available through the Center for Innovation located at UND – Grand Forks which serves the entire State. SBIC – SBICs are privately owned and managed investment funds, licensed and regulated by SBA, that use their own capital plus funds borrowed with an SBA guarantee to make equity and debt investments in qualifying small businesses. The U.S. Small Business Administration does not invest directly into small business through the SBIC Program.  North Dakota Small Business Investment Company ("NDSBIC"), established in 1995, is a Debenture SBIC. NDSBIC was established to make equity investments nationally, with a particular emphasis on the state of North Dakota. InvestAmerica is a nationally recognized private equity/venture capital investment management group with over 100 cumulative years of fund management experience. The Principals founded the InvestAmerica brand in 1985 with the establishment of InvestAmerica Venture Group, Inc. Since 1985, the Principals have successfully managed and grown the InvestAmerica related private equity/venture funds with investments throughout the United States. The InvestAmerica group is headquartered in Cedar Rapids, Iowa with regional offices in Kansas City, Missouri; Vancouver, Washington; Fargo, North Dakota and St. Paul, Minnesota. Contact John G. Cosgriff InvestAmerica Investment Advisors, Inc. 51 Broadway, Suite 500 Fargo, ND Phone: Fax:

7 7(a) Loan Programs Standard 7(a) (Term) SBA Express (Term / Revolving)Export Express (Term / Revolving) Export Working Capital Program (EWCP) International Trade Loan CAPLines Community Advantage

8 SBA Veterans AdvantageFY15 Patriot Express sunsets 31 Dec 2014 SBA launches SBA Veterans Advantage on Jan 1, 2015 SBA Veterans Advantage: reduced 3% fee to 0% for SBA Express loans of $150,001 to $350,000 7(a) loans (non Express) >$150M fees reduced by 50% up to $5M FY16 SBA Veterans Advantage continues as it was in FY2015 Veterans Entrepreneurship Act of 2015 becomes law July 2015 Makes fee relief permanent for SBA Express loans under $350,000 *as long as SBA remains subsidy neutral* FY17 Veteran Entrepreneurship Act provisions remain To remain subsidy-neutral, SBA must adjust SBA Veterans Advantage fee relief Fees reduced by 50% for non-SBA Express 7(a) loans $150,001 - $500,000 Veterans Entrepreneurship Act of 2015 Established the SBA Veterans Advantage loan 2) SBA charges a 3% loan guarantee fee to support a loan loss reserve sufficient to cover anticipated purchases of defaulted loans “Zero-Subsidy” allows the SBA to operate without a Congressional appropriation Each year the SBA assesses if fees cover cost of program Favorable economic forecasts=lower loan defaults and lower payouts on defaulted guaranteed loans; reverse is true Qualifications for loan- 51% owned and controlled by veteran Includes Reserve, National Guard and Spouses

9 SBA Express Loans Reduced Paperwork Fast turn around timeSubmitted electronically (Etran) Higher Interest Rate SBA/Export Express -Prime+ 6.5% Reduced Guarantee SBA Express 50% Limited to $350k A lender may be eligible to participate in SBAExpress if: It is currently an SBA partner lender and meets certain portfolio performance standards. There are no minimum SBA loan volume requirements to begin making SBAExpress loans. It is currently a non-SBA lender that makes a reasonable number of commercial loans of $50,000 or less. Lenders and borrowers can negotiate the interest rate. Rates can be fixed or variable and are tied to the prime rate (as published in The Wall Street Journal), LIBOR, or the optional peg rate (published quarterly in the Federal Register) and may be fixed or variable, but they may not exceed SBA maximums: lenders may charge up to 6.5 % over the base rate for loans of $50,000 or less, and up to 4.5 % over for loans over $50,000. Eligible military community members include: Veterans Service-disabled veterans Active-duty service members eligible for the military’s Transition Assistance Program Reservists and National Guard members Current spouses of any of the above, including any service member Widowed spouses of service members or veterans who died during service or of a service-connected disability Lenders can receive a maximum 7(a) guaranty of 85 percent for loans of $150,000 or less and 75 percent for loans over $150,000 up to $5000,000

10 SBA Loan Guaranty SBA Promises to reimburse a lender for losses at an agreed percentage of loss Up to 85% As low as 50% Lender Benefits Reduced Risk Increased Liquidity Borrower Benefits Access to business credit Better terms and rates Banks and other lending institutions offer SBA guaranteed loan programs to assist small businesses. While SBA itself does not make loans, it does guarantee loans made to small businesses by private and other institutions.

11 Use of SBA Guaranteed Loan ProceedsStart up costs Working Capital Inventory Equipment Fixtures Business Acquisition Debt Refinance Purchase land and buildings SBA loans can be used for a wide variety of purposes as indicated.

12 504 Loan Program Dakota Certified Development Corporation Lake Agassiz Certified Development Company Lewis and Clark Certified Development Company The Certified Development Companies (CDC)listed are the remaining statewide entities that process 504 loans. Souris Basin Certified Development Co. no longer exists as of July 2013 and their portfolio has been transferred to the other CDC’s listed.

13 Certified Development Company (CDC) 504 Loans$50,000 to $5,000,000 ($5,500,000 for manufacturers) Create 1 job / $65,000 (Not Vets/Women Owned) Finances only fixed assets Loan-to-Value loan Three part loan Commercial lender provides 50% (1st Lien) 504-CDC portion is up to 40% (2nd Lien) Owner/Borrower makes up the difference 504-CDC part term 20 year fixed rate for real-estate 10 year fixed rate for equipment Occupancy requirement 51% of existing & 60% of new construction

14 Bank of North Dakota ND Department of Commerce USDA Rural Development US Small Business Administration Center for Technology

15 Other Methods of FinancingCommercial Term Loans Lines of Credit Credit Cards Home Equity Loans - Real Estate Loans Leasing Investors – Partners Seller Financing Friends and Family

16 Crowd Funding Crowd funded equity made legal with the JOBS act of 2012, and the SEC is developing regulations for platforms You will be able to trade cash for ownership in your company via crowd funding websites Pros: You can cast wider net for potential investors Cons: You may not want ‘the crowd’ as a part owner of your company Resources: Many more...just Google: Crowd Funding Crowd funding is obviously a much newer form of financing and in its early stages. The regulations for crowd funding for equity are still being solidified by the SEC and we are waiting on the regulation. Until this point, crowd funding has been more ‘project based’ on platforms like kickstarter and indiegogo. This may develop into a very strong form of financing because of the number of investors you can reach through the internet. There are a lot of drawbacks at this point because of the lack of regulation around the different platforms.

17 Additional Programs Bismarck Vision Fund and Mandan Growth Fund Business assistance Lewis and Clark Regional Development Council Loans for business development Microloan Program Loans for Working Capital, Inventory, Equipment Contact Lake Agassiz Regional Council Intermediary Relending Program Loans for Working Capital, Inventory, Equipment, Buildings Contact USDA Rural Development for IRP lenders in your area Main Street Loan Program - Dakota Certified Development Corp. Loans for business development up to $50, There are many programs available through the entities listed. Lewis and Clark provides several types of loan programs including the ND Opportunity fund and their work with BMDA and the City of Mandan and other rural areas outside of the Bismarck / Mandan metro

18 Contracting / Procurement AssistanceInsure Small Businesses Receive Their Fair Share of Government Contracts Programs… Surety Bonds 8(a) Historically Underutilized Business (HUB) Zones The U.S. government is the largest single purchaser of goods and services in the world, awarding approximately $500 billion in contracts every year. The Small Business Administration’s Office of Government Contracting & Business Development works with federal agencies to award at least 23 percent of all prime government contract dollars to small businesses and help federal agencies meet specific statutory goals for small disadvantaged businesses, women-owned small businesses (WOSB), service-disabled veteran-owned small businesses (SDVOSB), and small businesses that are located in historically underutilized business zones (HUBZone). In addition, SBA’s 8(a) Business Development Program assists eligible socially and economically disadvantaged individuals in developing and growing their businesses through one-on-one counseling, training workshops, matchmaking opportunities with federal buyers, and other management and technical guidance.

19 Surety Bond Guaranty ProgramSBA - Guarantee Bonds for Contracts up to $10 Million for Small and Emerging Contractors who Cannot Obtain Surety Bonds Through Regular Commercial Channels SBA - Provides Bond Company a Guarantee up to 90% of the Contract A surety bond ensures contract completion in the event of contractor default. A project owner (called an obligee) seeks a contractor (called a principal) to fulfill a contract. The contractor obtains a surety bond from a surety company. If the contractor defaults, the surety company is obligated to find another contractor to complete the contract or compensate the project owner for the financial loss incurred.  There are four types of surety bonds: Bid Bond: Ensures the bidder on a contract will enter into the contract and furnish the required payment and performance bonds if awarded the contract. Payment Bond: Ensures suppliers and subcontractors are paid for work performed under the contract. Performance Bond: Ensures the contract will be completed in accordance with the terms and conditions of the contract. Ancillary Bond: Ensures requirements integral to the contract, but not directly performance related, are performed. When do I need a surety bond? Any Federal construction contract valued at $150,000 or more requires a surety bond when bidding or as a condition of contract award. Most state and municipal governments as well as private entities have similar requirements. Many service contracts, and occasionally supply contracts, also require surety bonds. What is SBA’s role? The mission of the Office of Surety Guarantees is to provide and manage surety bond guarantees for qualified small and emerging businesses, in direct partnership with surety companies. SBA helps small contractors by guaranteeing bid, performance, and payment bonds issued by participating surety companies for contracts up to $6.5 million. SBA can guarantee a bond for a contract up to $10 million if a Federal contracting officer certifies that SBA's guarantee is necessary for the small business to obtain bonding. Are there fees for SBA bond guarantees? SBA charges the small business 0.729% of the contract price for a payment or performance bond. There is no charge for a bid bond. SBA charges the surety company 26% of the fee the surety company charges the small business.

20 8(a) Business DevelopmentRequirements to be Eligible as an 8(a) Contractor Own 51% of company Be U.S. citizen Belong to a Disadvantaged Group Personal Net Worth Cannot Exceed $250,000 Exclude Business and Real Estate Equity Be a Small Business Based on NAICS Code Been in business for 2 yrs Meet Management and Capability Tests The 8(a) Business Development Program is a business assistance program for small disadvantaged businesses. The 8(a) Program offers a broad scope of assistance to firms that are owned and controlled at least 51% by socially and economically disadvantaged individuals. Participation in the program is divided into two phases over nine years: a four-year developmental stage and a five-year transition stage. Benefits of the Program Participants can receive sole-source contracts, up to a ceiling of $4 million for goods and services and $6.5 million for manufacturing. 8(a) firms are also able to form joint ventures and teams to bid on contracts. This enhances the ability of 8(a) firms to perform larger prime contracts and overcome the effects of contract bundling, the combining of two or more contracts together into one large contract. Also, see the Mentor-Protégé Program for more information on allowing starting 8(a) companies to learn the ropes from other more experienced businesses. Requirements and Goals of the 8(a) Business Development Program The overall program goal is to graduate 8(a) firms that will go on to thrive in a competitive business environment. Program goals require 8(a) firms to: Maintain a balance between their commercial and government business. Limit on the total dollar value of sole-source contracts that an individual participant can receive while in the program: $100 million or five times the value of its primary NAICS code.

21 HUB Zone Program Provide economic development to communities through government contracts. Principal office must be located in a HUBZone. 51% owned by a U.S. citizen. 35% of employees must live in HUBZone areas. Must be small business according to NAICS code.

22 HUB Zone Benefit Set-aside awards Sole source awardsAwards through full and open competition after application of 10% price evaluation preference Subcontracting Opportunities The Historically Underutilized Business Zones (HUBZone) program helps small businesses gain preferential access to federal procurement opportunities. These preferences go to small businesses that obtain HUBZone certification in part by employing staff who live in a HUBZone. The company must also maintain a "principal office" in one of these specially designated areas. Contracting officers can find this information useful as well, in addition to some the information about regulations to cater to their needs in assisting small businesses which are qualified as HUBZones.  A "HUBZone" is an area that is located in one or more of the following: A qualified census tract (as defined in section 42(d)(5)(C)(i)(I) of the Internal Revenue Code of 1986); A qualified "non-metropolitan county" (as defined in section 143(k)(2)(B) of the Internal Revenue Code of 1986) with a median household income of less than 80% of the state median household income or with an unemployment rate of not less than 140% of the statewide average, based on U.S. Department of Labor recent data; or Lands within the boundaries of federally recognized Indian reservations. How Does the HUBZone Program Work? The SBA does the following: Determines which businesses are eligible to receive HUBZone contracts Maintains a listing of qualified HUBZone small businesses that federal agencies can use to locate vendors Adjudicates protests of eligibility to receive HUBZone contracts Reports to the Congress on the program's impact on employment and investment in HUBZone areas

23 SBA Resources SBA SCORE SCORE Small Business Development Centers (SBDC) or Women’s Business Center (WBC) https://www.sba.gov/tools/local-assistance/wbc Social Media https://www.facebook.com/SBAgov/ https://mobile.twitter.com/sbagov https://www.youtube.com/user/sba

24 Contact Information SBA Offices Fargo (701) Bismarck (701) Grand Forks (701)

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