What is a Small Business? The Answer May Surprise You.
September 16, 2021
Most are aware that small businesses are the backbone of our local and national economies and one of the main drivers of our country’s financial growth. However, when asked what constitutes a small business, there is often some confusion–even among small business owners and employees themselves.
When you hear the phrase “small business”, what comes to mind? For the vast majority, it’s the florist down the road, the coffee shop on the corner, or their favorite family-owned restaurant. However, based on the qualifications established by the Small Business Administration
(SBA), which has provided small businesses with financial and educational support for more than half a century, these are only the tip of the iceberg.
In fact, there are more than 30 million small businesses in the country, comprising 99.9 percent of all U.S. businesses, according to the SBA’s Office of Advocacy.
So, what exactly is a small business and could yours qualify to receive an SBA 7(a) loan with BayFirst
? According to the SBA, you’ll have to check each of the following boxes:
- My business is a for-profit business
- It is headquartered in the U.S.
- My business is independently owned and operated
- My business is a sole proprietorship, partnership or corporation, or any other legal form
- It meets the size standards for my industry set by the SBA. (This SBA size standards tool can also help determine)
It meets the alternative size standard: a net income (revenue minus expenses) of less than $5 million (when taking the average of the last two years) or a tangible balance sheet showing a net worth of less than $15 million.
If you’ve checked all the boxes, you could be eligible to receive an SBA 7(a) loan to support or grow your business, but you should contact an expert at BayFirst
to review all eligibility requirements. We are one of the nation’s leaders in small business lending and can help every step of the way.
Now that you know what a small business is, you’ve likely realized just how frequently you rely on their products and services. So, be sure to support your favorite small business by stopping in, purchasing a gift card, posting about it on social media or simply recommending it to a friend.
And don’t forget about those small businesses you may have overlooked, like your doctor or dentist, your favorite museum, your childcare provider, Uber driver, veterinarian, child’s school and even franchises of Subway, McDonald’s, hotel chains and auto dealerships. It is likely they all qualify as small businesses, too.
For more information on SBA 7(a) loans, fill out this form and we will give you a call!