Small businesses are critical to local economic development,Â yetÂ there are several barriers holding them back in the path to prosperity. As we adjust to changes forced upon us by the pandemic, it is critical that we work to bridge the gap in services and support systems available for these enterprises compared to those for larger corporations.Â
According to the National Bureau of Economic Development, â€œthe number of active business owners in the United States plummeted by 3.3 million, or 22 percent, over the crucial two-month window from February to April 2020â€ alone.
I personally witnessed the sudden impact of the pandemic on my start-up, Punch List, which saw metrics drop 75-80% in those early weeks. The implications lead to some of the most frightening periods of my career, one that has spanned several roles dedicated to building tools forÂ small and medium-sized businesses.Â
In order to boost recovery, while creating impactful and sustainable change, we must work to level the playing field for these enterprises that are the heart of this country. So what can we do?
Work with local leadersÂ
We must pressureÂ local leaders to eliminate antiquated laws governing the spacesÂ that small businesses operate in. Many cities require vast sums, or lengthy lead times, to get started due to incredibly complexÂ regulations. These requirements should be tabledÂ during the COVID-19 era to help prepareÂ put-upon owners asÂ quickly as possible.
For example: In San Francisco, a long-overdue Proposition H just passed on the November ballot to reform the slow processÂ to get permits reducing certain processing times from what could take 18+ months to under 30 days. Let us push our local representatives to continueÂ along this path.Â
Provide access to capital
A number of institutions across government and private sectors are committed to helping, however these sources often lack publicity and aggrieved ownersÂ lack the tools to discover, access and understand them. Working to create comprehensive guides to local, stateÂ and federal funding resources that help entrepreneurs – especially those who lack financial literacy and access to available funds like SBA loans and city grants, such as SF Shines, which help break the cycle of systemic inequality.Â
Work with local leadersÂ reform
Historically â€œpro-businessâ€ politicians have catered to big companies with loopholes, tax breaksÂ and special favors. We need to enact legislation to protect SMBs who are far more vulnerable to roadblocksÂ than the millionaire CEOsÂ handing out large campaign contributions.Â
Look at the Ed Lee era â€œTwitter Tax Breakâ€, for example, which incentivize multi-billion dollar companies to stay in San Francisco, but came at the expense of small businesses who were displaced and priced out. We need to rethink such public policies and ensure that local, mom-and-pop franchisesÂ are given the same protectionsÂ as their larger counterparts. Furthermore, I believe that start-ups should be exempt from taxes in their first year of operations to encourage success.Â
Rethink urban planning
One positive shift from COVID-19Â has been metro areas adopting â€œparkletâ€ seating in the streets immediately outside of an establishment, which allows restaurants to operate with expanded seating and proper social distancing. Cities should go even further by helping with the costs of parklets and investing in infrastructure to ensure the realm is well-designed and maintained.Â
Embrace new revenue streams
Owners should be joining like-minded groupsÂ in their community to share key learnings across different sectors, asking questions and taking notes so that when neighboring shops and competitors are trying something new, they are able to try it out for themselves. For example: Starting a business in El Paso? Why not sign up for one of these initiatives from the El Paso Chamber of Commerce?Â
Create tools for small businesses
I grew up in Plymouth, Michigan, among 9,000 other suburbanites, betweenÂ the economic centersÂ that were Detroit and Ann Arbor.Â When I think of America?Â I donâ€™t think of Times SquareÂ or movie lots in Los Angeles or massive shipping ports in Florida—I think of little Main Streets filled with businesses just trying to sell whatever good or service they specialize in. When I ponder economic prosperity or growth, I think of my home town. Whenever IÂ introduce a new product, I always ask myself:Â â€œHow does this benefit the seller in Plymouth?â€ not simply â€œHow can I get a Fortune 500 company to use this?â€.
As I look back on this past year,Â I am humbled by the sheer magnitude of the pandemic’s impact. It has further solidified my commitment to developing technology to reduce the challenges that business owners face. As we look over the horizon, we must commit to building stronger support systems that ensure the survival of those mom-and-pop shops that define our towns. Let us eliminate barriers, and move forward with strategic vision,Â building a more resilient future for the small business ecosystem. Keep the American Dream alive!