Why the SBA Should Care About Intangibles

Read the statement about the importance of intangibles to entrepreneurship that I co-authored with Ken Jarboe of the Athena Alliance in response to an SBA RFI on entrepreneurial mentoring on the Athena website. IC is critical to the development of all companies–most especially entrepreneurial and high-growth ones.

Let us know what you think!

SBA Goofs on Intangibles

Thanks to Donald Todrin for his post The SBA puts another stake in the heart of the small business world. He explains the the Small Business Administration (SBA) issued new guidelines on February 7th saying that no more than 50% of a 7(a) loan should be used to finance goodwill.

Given that goodwill is accounting’s (very inadequate) way of keeping track of the intangibles that drive business performance today, this ruling means that the SBA will not finance many of the kinds of business we need to increase innovation and growth in our economy–the businesses that leverage knowledge. This isn’t an abstract thing. Every business with a computer can and should begin to create more and more value without investing in the hard assets that appear on the balance sheet. Read more