You're watching...
Small Business Authority CEO Barry Sloane on the state of small business and which industries can flourish in the current economy.
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
Mr.
-- great to be here Carter so our small business accounts.
Sure how much of the -- scholar.
According to the Small Business Administration about 50% and nonfarm GDP is generated by small businesses all across the US -- all.
And and more of small businesses hire -- percentage of people.
But 70% and net new job creation comes at a small businesses today salts -- huge market and it's the engine of for the US economy and a lot of people don't realize nine out of ten businesses in the US are defined.
As small by the US government Small Business Administration.
What is the best small business of -- While today you've really got to pick certain segments that are -- I mean things obviously like energy you're doing real well exports are doing -- the dollars cheaper.
Things you need to be really careful about -- things like.
Businesses that provide consumption because this economy is totally consumption base 70% of US GDP example.
Well you wanna be careful about businesses like our restaurants entertainment.
Things that -- are basically.
Consumption base that you don't need -- strong economy really be robust and prime.
-- home.
A -- -- -- drug -- well this country clearly needs to produce things that people have a need for frankly within aging demographic.
Health care is very good industry to be and technology is an important industry to be -- Cloud computing which were involved with.
It's gonna save businesses a lot of money over the next ten to twelve different -- basically businesses are gonna be run with ipads and Smartphones.
People -- not -- be hooked up to desktops are directly connected so if you could transmit information to businesses through an iPhone or iPad.
And basically not have the connectivity she could run your business -- payroll take electronic payment processing.
See web traffic all from an iPad or iPhone that's the future of of the economy and -- on Barcelona's assume you know.
All of undeterred business arms of Russian.
And part of new churches of Small Business.
Administration right.
Well we're an SBA lender with a largest non bank SBA lender we anticipate lending over 125 million dollars this year.
To small businesses and historically done over about a half a billion dollars boarded up tomorrow to London.
Well we use our own equity capital and we get bank lines of credit.
Which is not an easy thing to do today but we have done that for the last eight years sort you're Smith Barney want to -- -- Was was the Small Business Administration.
Already part and attract.
No -- when I was at Smith Barney I ran a securitization business I got a lot of comment.
Well -- got a lot of experience dealing with.
Banks and other financial institutions that made loans.
And then finance them through securities.
And that business flourished and unfortunately it got over done by Wall Street in created a lot of wealth destruction -- -- all -- -- -- to recommend.
Isn't your idea to recruits to small Brussels.
Well yeah after I left Smith Barney and you started working out of your home the businesses though typically deal with the tend to be small don't sell -- -- necessity -- that are working with small businesses and realize that they had a lot of needs both for capital and business services.
And real literally out of an apartment in New York City sort of the concept of new tech business services -- turn -- element.
I think so.
A lot of people have gotten beaten up trying to do this before it's hard to deal with small businesses because they are small they don't generate a lot of revenue.
And the spread across the country so it's hard to acquire a lot of small business clients -- Ross do so -- -- -- -- -- -- -- -- be very careful because small businesses typically fail I think about 20% of all small businesses that start up all of them that's right but 80% succeed the 80% do succeed over the course of time so.
It's important to pressure capital so if you've got a business that's pushed brand new start up.
You don't lend the money for five and 6% that you -- and get venture capital or.
Angel capital but for -- been around for three to ten years has good operating history where it should lending the money today.
-- -- -- -- Again not just him a couple of businesses.
And arguments and then.
-- -- on iPhone battle but America a couple of by deals on.
It's like a like a pizza place Telefonica -- Pot if she's one of the start went up from scratch time.
I would just take a walk down nine New York City street and CME pizza places -- -- our -- monitor him.
Help Jim there's plenty gym memberships -- very saturated business you really need a new idea do you wanna be in -- space.
Where there's growth.
Practically spaces like energy for example where there's -- -- on health care and health care is yet.
All -- what to do what a scooter store on the front.
That would work.
Eskom are trying to sort of summer -- of some money from you know professional not -- about borrowing over a fellow very -- From from Obama's administration moved to a corporation.
There's a quarter to what our -- -- small businesses as you sound.
-- our current -- responsible for about.
Half of -- economy -- -- economy -- Well it's growing at a very slow pace at this point in time I think the big issue that people concerned about particularly independent business owners as the size of the national debt.
To go down the block every US citizen knows 50000 dollars.
And I think business owners are deeply concerned that that is going to be their debt anybody today that has any form of wealth needs to be concerned that the government.
Ultimately is going to come after that wealth.
-- -- remain in the form of taxes or some form of other confiscation.
Yes.
-- -- just -- Obama -- selected per second -- and -- just come glom on your money.
While things like the estate tax or taxing capital gains have been doing an -- Canada will not -- -- industry a lot of economic -- -- -- so.
So not so generous contract or do you think without getting political on not trying to.
But Chenault barks at all.
-- is somebody like -- -- and -- and then turn.
Well I think he is idea which is been beaten up quite a bit which has really Paul Ryan's plan to cut cap and balance.
Dead is important and it's not trained colony in and it's not radical though it's frankly pretty simple go back to spending levels of a couple years ago.
And then cut the rate of growth until revenues catch up.
That's what individuals doing their homes and that's -- business owners do today also good -- term in -- Connell and item.
Call.
Protesters' numbers want to retailer -- offenders them.
The number of people filing for unemployment and Indian immigrant numbered -- but what -- like -- a point 1% -- not a good barometer to have.
It's a number that everybody uses and I'll just like gross domestic product which is total sales is the number that everybody uses the wrong numbers.
They're wrong.
They are wrong that's the wrong way to measure all works US economy.
-- -- Well if you were a business owner would you measure the health of your business just -- growing sales particularly if you had an unlimited capacity to borrow at rates from zero to 1%.
So what politicians do today is they key borrowing -- it's very easy to boost GDP if you can borrow at 01%.
And the reason why are able bar -- -- 1% is of all the economies were clearly messed up but everybody is so much worse off.
That all -- of dollars are running to the US government.
So are you optimistic -- I'm optimistic because I believe American citizens do realize that they over the 50000 dollars.
And that they're gonna have to pay it and -- -- and I think -- room to almost triple of traditional products.
-- -- -- -- I think they are so they they like I didn't -- -- morning.
Just not allowed through after grant some.
That's she issued that your wife and your children -- -- -- did and also they also 50000 dollars and somebody is gonna ultimately have to pay that.
Back now -- I don't know.
At what I was for coming and journalists rose.
Relevant -- remember -- -- cereal and a messenger gentlemen every time running out of -- and well you've been great and we appreciate every -- room.
