Kansas Common Sense: Small Business Hearing Entrepreneurship Ecosystem

Statement

On Thursday, I attended a Small Business Committee roundtable discussion on Small Business Investment Companies (SBIC) and their role in the entrepreneurship ecosystem. SBICs are privately-owned and managed investment firms licensed and regulated by the Small Business Administration (SBA) that provide venture capital to small businesses. The role of SBICs is to bridge the gap between entrepreneurs' need for capital and traditional sources of financing. For every $1 an SBIC raises from a private investor, the SBA will typically provide $2 of debt capital. This funding helps young businesses during their crucial growth stages and, because the SBA collects sufficient fees from funds it invests in, the SBIC program is able to operate at zero cost to taxpayers. Currently, three SBICs are located in Kansas: MidStates Capital Fund (I and II) in Overland Park and Kansas Venture Capital of Leawood.

The bottom line for Americans is jobs, and SBICs created 61,000 jobs in the fiscal year 2011 -- a total that has been steadily increasing the last few years. I am committed to finding ways to encourage job creation by small businesses, startups and entrepreneurs, and was pleased the Senate passed H.R. 3606, the JOBS Act, with strong bipartisan support this week. It is encouraging to see more members of Congress coming to the realization that in order to create jobs, we need to help entrepreneurs and strengthen the ability of startups to grow.

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