Originally published Jan. 13, 2013
Nate Phelps owns Central District Cyclery, a bicycle shop in Grand Rapids.
For about a year now, Phelps has relied on the resources offered by the Michigan Small Business and Technology Development Center, whose headquarters are hosted by Grand Valley State University. Through the center, he learned how to hire his first employee, develop business plans, make sense of financial statements and implement basic human resources practices.
Recently, the MI-SBTDC helped the cycle shop develop an online presence through search engine optimization.
“It has been tremendous help to go in and bounce ideas,” Phelps said. He added that he had previously solicited advice from friends and people from the bicycle industry, but he appreciated the different perspective of business people at the MI-SBTDC.
Specifically, the center taught him to “take the passion out of it and look at whether the business was profitable versus unprofitable,” he said. “That was invaluable.”
To enable the MI-SBTDC to continue helping business owners like Phelps, the Small Business Association granted the center more than $3.3 million in continued funding for 2013.
“They find value in the service because the SBTDC in Michigan served over 16,000 small business in Michigan last year, and that is consistent throughout the years,” said Jennifer Deamud, associate state director of the center.
While the center’s resources extend to businesses throughout the state, it has also made an impact on the local economy.
“The SBTDC serves about 700 businesses annually in the West Michigan market,” said Brian Picarazzi, senior area manager for the SBA in western Michigan. “In 2011, 466 jobs were created through companies that work directly with the SBTDC. Job creation is a vital component of a healthy economy and the SBTDC plays a major role in helping small businesses be successful and impactful within their communities.”
Picarazzi said the SBA sets goals for the MI-SBTDC to accomplish with its funding.
“These goals are tied to job creation, access to capital and new start businesses,” he said. “By reaching these goals, the SBTDC will continue to have a positive impact on the Michigan economy.”
Deamud said the center not only meets but exceeds those goals each year, so it’s rare for the SBA not to renew its funding.
To retain funding, the center must cash-match the $3.3 million prior to receiving the grant. Deamud said 24 percent of the total comes from the Michigan Economic Development Corporation, while the other 26 percent comes from host offices of the MI-SBTDC in other Michigan colleges, like Eastern Michigan University and Lansing Community College.
This year, the center exceeded matching funds, which may merit additional funds during the year.
“On occasion, if we have over and above, there are opportunities throughout the year when SBA will have dollars available for centers for a specific purpose,” Deamud said.
Prior to 2012, the MI-SBTDC received $3.7 million every year, but the amount decreased last year when the Michigan census reported a decline in the state population, which is tied to the grant.
“The center acquired additional funding from the state to help with that gap,” Deamud said, adding that the MI-SBTDC also tightened its spending.
However, the business model for the center has not changed with the diminished funds. The office offers courses and seminars for small business owners to receive business plan development aid, financial training and industry-specific advanced training.
Over the years, it adjusted its offered services to fit the changing demographic of clients, which shifted from 60 percent start-ups five years ago to 60 percent growth companies today. Deamud said the center is also refining and adding services when it identifies a need.
“The SBTDC plays a critical role in many aspects of small business,” Picarazzi said. “They provide counseling for existing businesses that may want to expand or hire new employees and/or connect them to a local lender that can provide capital for the business. They also can help a small business startup. These things help impact the economy and help small businesses succeed—all things that the SBA finds valuable.”
So far, Phelps has also found the resources valuable and said he foresees his relationship with the MI-SBTDC continuing throughout the years, especially as he looks to develop new business plans.
“I’d like to think this isn’t my only business venture and would definitely, as I start to develop my next idea, work right along just how I have (with the center),” Phelps said.
For more information about the MI-SBTDC and its programs, visit www.misbtdc.org.
Original publication: http://www.lanthorn.com/article/2013/01/mi-sbtdc-gets-3-3-million-from-sba