Innovation Advocacy Council chair testifies on SBA programs and job creation

Last week, SSTI’s Innovation Advocacy Council chair Ben Johnson (also of BioSTL) testified before a subcommittee of the House Committee on Small Business about the role that innovation plays in job creation and how the U.S. Small Business Administration’s (SBA) Regional Innovation Clusters (RIC) and Growth Accelerators Fund Competition (GAFC) support these efforts.

In his testimony, Johnson spoke to how the needs of innovation-based companies differ from those of Main Street businesses:

“The types of support needed to mature a technology from idea to market readiness are different than the supports needed to manufacture or market a widget. … The types of capital raised by innovation-based businesses are different as these companies take longer to mature to revenues. … And, the networks of industry-specific expertise … need to be deeper in defined expertise, than broad networks of business, finance, or marketing mentorship that is generally applicable across all types of business.”

Johnson also spoke to the value of SBA’s innovation programs, with a particular emphasis on RIC as a tool to provide businesses within a specific region and industry with the support they need to develop new technology, expand sales, and hire new workers:

“The RIC program is unique in that it helps provide funding for the ‘glue’ that differentiates a regional economy from its competitors around the globe. …  Over the five years of the contract, BioSTL and its partners provided counseling, training & mentoring to nearly 2,000 small business and entrepreneurs just starting their small business journey. These activities resulted in the creation of nearly 500 jobs and the attraction of nearly $1 billion in financing for the small businesses.”

Other speakers on the witness panel were the executive chair of the Kansas University Innovation Park and leaders from two small businesses. All three have benefited from SBA’s GAFC program and spoke to the role of incubators in supporting new enterprises in their remarks.

Committee members responded favorably to this testimony and asked follow-up questions about improving SBA’s assistance, regulations around initial hires, and capital access concerns, as well as the impacts that tax changes could have on small businesses.

At this time, SSTI is not aware of immediate plans by the committee to introduce legislation related to the hearing. However, the small business committee could play a role in upcoming human infrastructure or defense authorization bills.