HAWAII EDITION 2020 Small Business resource guide

GROW YOUR BUSINESS in hawaii

1 2 CONTENTS Hawaii Edition 2020

Local Business Funding Assistance Programs

8 National Success Story 28 National Success Story Jerado and Joyce Reynolds Jennifer and Jeff Herbert’s know their local landscape for meadery has expanded into a entrepreneurship support. multimillion dollar enterprise thanks to SBA assistance. 11 Local SBA Resource Partners 31 SBA Lenders

13 Your Advocates 33 Need Financing?

14 How to Start a Business 34 Go Global with International Trade 19 Find an EIN 36 R&D Opportunities for 20 10 Tips to Help Build and High Growth Startups Grow a Stand-Out Brand 38 National Success Story 22 10 Steps to Start Cheeseburger Baby owner Your Business Stephanie Vitori persevered through a financial storm and a 23 Opportunities for Veterans natural disaster.

24 Write Your Business Plan 42 Surety Bonds 26 Local Success Story Rolf Klein and Alvin Bongolan wanted to handle their business’s Contracting growth with care, so they turned to the SBA for financing assistance. 44 National Success Story Jennifer Rahn steers the course for Admiral Engineering, succeeding as a small business subcontractor.

47 Government Contracting

48 SBA Certification Programs

49 Woman-Owned Small Business Certification

ON THE COVER L-R, McKinley Car Wash owners Craig and Max Yoshikawa, courtesy of Sean Marrs; L-R, Hawaii Energy Systems Chief Operating Officer Alvin Bongolan and Chief Executive Officer Rolf Klein, courtesy of the SBA; Lawson & Associates owner Tracy Lawson, courtesy of the SBA; L-R, Banan cofounders Zak Barry, Matthew Hong & Luke Unterman, courtesy of the SBA 3 Let us help give voice to your story.

SCOPE OF SERVICES We have all heard the phrase “content is king.” Creating rich, engaging, and inspiring content differentiates your brand in the Brand Voice Catalogs marketplace. But who has time to focus on Articles Visitor Guides anything other than running their business? Narrative works with you to develop Blogs Books the tools to tell your story across all Website Content Copywriting media platforms. Powerful and authentic Social Media Posts Photography storytelling helps you stand out. It inspires Email Content Videos action. It creates an emotional impact and Brochures forges enduring relationships. It separates you from the competition.

To schedule a meeting or to learn more, contact Buddy Butler at [email protected] BY NEW SOUTH MEDIA or call 304.615.9884.

4 5 PUBLISHED BY New South Media, Inc. 304.413.0104 | newsouthmedia.com

PUBLISHER Nikki Bowman, [email protected]

DESIGNER Hayley Richard, [email protected]

ASSOCIATE EDITORS Pam Kasey, [email protected] Jess Walker, [email protected]

OPERATIONS MANAGER Holly Leleux-Thubron, [email protected]

ADVERTISING SALES DIRECTOR Heather Mills, [email protected]

ADVERTISING SALES Meggan Hoyman, Kelley McGinnis, Bryson Taylor [email protected]

Copyright: New South Media, Inc. Reproduction in part or whole is strictly prohib- ited without the express written permission of the publisher.

© 2019 NEW SOUTH MEDIA, INC., ALL RIGHTS RESERVED

The U.S. Small Business Administration’s Office of Marketing & Customer Service directs the publication of the Small Business Resource Guide under SBA Contract #SBAHQ- 17-C-0018. SBA publication summer 2019 national edition #mcs-0089.

WRITER/EDITOR Becky Bosshart (202) 205-6677 [email protected]

DIRECTOR OF MARKETING Paula Panissidi Tavares [email protected]

The SBA’s participation in this publication is not an endorsement of the views, opinions, products or services of the contractor or any advertiser or other participant appearing here. All SBA programs and services are extended to the public on a nondis- criminatory basis. Directory listings do not constitute or imply an endorsement by the SBA of any opinions, products, or services of any private individual or entity.

Printed in the United States of America.

While every reasonable effort has been made to ensure that the information con- tained here is accurate as of the date of publication, the information is subject to change without notice. The contractor that publishes this guide, the federal govern- ment, or agents thereof shall not be held liable for any damages arising from the use of or reliance on the information contained in this publication.

6 SBA Hawaii District Office Serving the state of Hawaii and the territories of American Samoa, Guam, and the Commonwealth of the Northern Marianas Islands, the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau 500 Ala Moana Blvd., suite 1-306 Guam Office Honolulu, HI 96813 400 Route 8, suite 302 (808) 541-2990 Hagatna, GU 96910 Fax (808) 541-2976 (671) 472-7419 sba.gov/hi Fax (671) 472-7365 @SBA_Hawaii

District Director Guam Branch Manager District Director Letter Jane Sawyer Kenneth Lujan elcome to the 2020-2021 edition of the U.S. Small Business (808) 541-2990 x202 (671) 472-7277 Administrationʼs Hawaii Small Business Resource Guide. [email protected] [email protected] Hawaii, our largest population center, has over 132,500 Wsmall businesses, making up 99% of all businesses in the state and Deputy District Director Lender Relations Specialist employing 52% of the workforce. The leading industries in our district Thornton “Mark” Spain Josette Mueller include tourism/hospitality, health care, construction, and retail. The (808) 541-2990 x209 (671) 472-7244 SBA helps make the American dream of small business ownership a [email protected] [email protected] reality, helping all our small businesses start, grow, expand, or recover Economic Development after a disaster. Specialist To get started, visit an SBA office or one of our SBA Resource Mary Dale Partners. Starting on pg. 9 you will find listings for free or low-cost (808) 541-2990 x211 business advisers, which includes Small Business Development [email protected] Centers, SCORE mentors, Women’s Business Centers, and the Veterans Business Outreach Center. Interested in small business financing? Lead Business Opportunity Find out if SBA-backed financing is right for you by consulting with Specialist an SBA specialist at one of our partner lending institutions, listed Michael Youth in the green Funding Programs section. This guide also details SBA (808) 541-2990 x214 disaster assistance loans and SBA-backed loans exclusively for [email protected] small business exporting. If you are interested in getting started in government contracting, read about SBA certifications and our Business Opportunity business development programs. SBA programs and services help you Specialists better compete in the public marketplace. The SBA works with the U.S. Erlyne Lum Department of Agriculture and the Department of Housing and Urban (808) 541-2990 x207 Development to increase opportunities in rural communities and [email protected] Opportunity Zones, which expand from our HUBZones, Historically Sheila Taeza Underutilized Business Zones. (808) 541-2990 x208 Stay up to date on SBA events near you and get valuable local [email protected] business information by following us on Twitter at @SBA_Hawaii. Register for email updates at sba.gov/updates. Use our Small Public Affairs Specialist Business Resource Guide to power your dream of starting, growing, or Sandra Cancinos expanding your small business. (808) 541-2990 x222 [email protected] Sincerely, Jane Sawyer Administrative Officer District Director Joyce Tamayose Quinn (808) 541-2990 x223 [email protected]

7 LOCAL BUSINESS ASSISTANCE

How We Did It Made

toJoyce and Jerado Last Reynolds used SBA support to succeed. Written by Micaela Morrissette COURTESY OF SHANA SURECK PHOTOGRAPHY SURECK SHANA OF COURTESY 8 LOCAL BUSINESS ASSISTANCE

eynolds Welding & Fabrication has grown steadily, building a loyal customer base, since Tips for Jerado Reynolds founded the company in 2005. Success R“At first the company was just Jerado,” recalls his wife and co-owner, Joyce 5 Find a great business mentor. Reynolds. “Then it was him and me part To find your local SBA office and time.” During the day she worked as a resource partners in your area, visit nurse and spent her evenings doing all sba.gov/localresources. the company’s paperwork. The Reynolds sank everything they earned into the business—money, time, and energy. She Have a healthy view remembers with pride helping Jerado of competition. weld a stair railing at a local school. Her COURTESY OF SHANA SURECK PHOTOGRAPHY SURECK SHANA OF COURTESY We’re not always competing. son later attended that same school, We’re a competitor, but if a similar and she watched her child and others an SBA Resource Partner, where “from business has extra work, they’ll send using the rail, benefiting from the day one it was, Eureka! Everyone wanted it to us and vice versa. That’s the hard work the couple did together. It to see us win.” Women entrepreneurs relationship to have. was then Joyce decided as much as she receive essential business counseling and loved her day job, she wanted to devote training from this national network of herself full time to the family business community-based centers. Most helpful Record everything you do. in Windsor, Connecticut. She wanted was the detailed personal attention Navigating business relationships to work side-by-side with her husband, available through free one-on-one in this age means keeping an email fully focused on administration and record of everything you do. Leave a business counseling. Joyce also learned business growth. As they both hoped, clear paper trail. about workshops offered by providers like word of mouth spread; clients made the Metropolitan District, a Connecticut referrals. Joyce was soon overwhelmed nonprofit municipal corporation offering with paperwork. They brought on two water and sewer services. At a meet- Sacrifice to ensure quality. employees—doubling up in the busy We don’t cut corners. Sometimes you and-greet, Joyce understood how much seasons. They were able to maintain four have to lose money to do quality work— the SBA could help her business. An full-time employees by 2009. After this, it’s rough, but nothing is more important. SBA professional walked Joyce through Joyce says, they saw that “things were the extensive paperwork and, crucially, not moving.” She wanted to scale up. helped her register the company in Seek SBA assistance to Challenge the System for Award Management The company wasn’t growing in part (sam.gov), positioning the company for see if you qualify for because it wasn’t certified with the new federal contracts. business certifications. state department of transportation or “Resources like the Entrepreneurial We used to look for jobs. Now that prequalified with the Connecticut State Center and the SBA will train you from we’re on the SBA Subcontracting Department of Administrative Services, bottom to top,” Joyce says. “They have Network database, SubNet, and sam.gov, we have a continuous flow Joyce says. She decided to tackle the finance classes that open your eyes of contractors reaching out to us. certification problem full time, leaving regarding taxes. You'll learn how to her nursing career. This was the change register your business. They’ll help she'd been wanting to make, but since with a contract or your website or on two bridges—a lifelong dream. Joyce her background was in health care, accountability statements. Everything!” continues to move forward, getting Joyce didn’t feel fluent in the languages Before the SBA, Reynolds Welding Reynolds qualified for the SBA 8(a) of construction or business. Joyce attempted the DOT certification on five Business Development Program, which wanted to learn, and she had incentive: separate occasions, always falling short provides free business development they needed the certifications to bid because the process was so complicated. education to small businesses so they on bigger jobs. “Never be afraid to ask Joyce secured the certification with SBA can better compete in the public sector. questions,” she says. Joyce needed to guidance on the first attempt. “When I came on full time, I set a goal find people with answers. for what I would like for the company, Benefit and I’ve achieved 80% of that,” Joyce Solution Reynolds Welding now employs more says. When she secures 8(a) certification She and Jerado connected with the than 15 workers, constructing stairs, for Reynolds, she’ll have hit all her University of Hartford Entrepreneurial rails, structural beams, and columns objectives. Then, she admits, she’ll Center & Women’s Business Center, throughout the region. Jerado is working probably come up with some new ones.

9 LOCAL BUSINESS ASSISTANCE

SBA Resource Partners No matter your industry, location, or experience, if you have a dream, the SBA is here to help you achieve it. Our SBA Resource Partners offer mentoring, counseling, and training to help you startup and thrive at all stages of the business life cycle. These independent organizations operating across the United States and U.S. territories are funded through SBA cooperative agreements or grants.

SMALL BUSINESS DEVELOPMENT CENTERS

Achieve your dream of business ownership and remain competitive in an ever-changing global economy with assistance from your local SBDC. Access free counseling and free or low- + cost training on topics like regulatory compliance, technology 950 development, and international trade. Find an SBDC adviser at Small Business sba.gov/sbdc. Development Centers

SCORE

Join the ranks of other business owners who have experienced higher revenues and increased growth thanks to SCORE, the nation’s largest network of volunteer business mentors. Experienced + executives share real-world knowledge to fit your busy schedule. 300 SCORE mentors are available for free as often as you need, in person, SCORE chapters via email or over video chat. Find a mentor at sba.gov/score.

WOMEN’S BUSINESS CENTERS

Women entrepreneurs receive essential business counseling and training from this national network of community-based centers. Each center tailors its services to help you navigate the challenges + women often face when starting or growing a business. To learn 100 about SBA resources for women visit sba.gov/women. Women’s Business Centers

VETERANS BUSINESS OUTREACH CENTERS

Veteran and military entrepreneurs receive business training, counseling, and referrals to other SBA Resource Partners at a Veterans Business Outreach Center, sba.gov/vboc. Receive + procurement guidance to better compete for government 20 contracts. VBOCs also serve active duty service members, Veterans Business National Guard or Reserve members, veterans of any era, and Outreach Centers military spouses.

10 LOCAL BUSINESS ASSISTANCE

L-R, Senior Business Advisors Micolas Ogawa and Dennis Wong, Director of SBDC Oahu Center Joseph Burns, Senior Business Advisor Erin Kanehira, Administrative Assistant

COURTESY OF THE SBA Andra Tejero-Gaspar, Senior Business Advisor Lori Hiramatsu Our Local SBA Resource Partners SBA’s Resource Partners are independent organizations funded through SBA cooperative agreements or grants. Small Business SCORE Visit sba.gov/score to start working on Development Centers your business goals. Contact your local hisbdc.org office to schedule an appointment. State of Hawaii Lead Center Hawaii Business Research Library Oahu Chapter Hawaii Innovation Center Kihei (808) 547-2700 (808) 974-7515 (808) 875-5990 hawaiiscore.org hisbdc.org/businessresearchlibrary.aspx East Hawaii SBDC Maui Chapter Hilo (808) 933-0776 Oahu-Honolulu SBDC (808) 873-8247 Honolulu maui.score.org West Hawaii SBDC (808) 945-1430 Kailua-Kona (808) 333-5000 American Samoa Community College SBDC Kauai SBDC Pago Pago (684) 699-4830 Lihue pacificsbdc.com (808) 241-3148 Pacific Islands SBDC Maui SBDC pacificsbdc.com Kihei (808) 875-5990

11 LOCAL BUSINESS ASSISTANCE

Program Coordinator Brittany Montilliano, left, and Director Colleen McAluney. Women’s Business Center Patsy T. Mink Center for Business & Leadership 1040 Richards St., suite 105 Honolulu (808) 695-2635 mcblhawaii.org COURTESY OF THE SBA

Director Dennis Kwak, left, and Business Veterans Adviser Viktorija Aniulyte. Business Outreach Center of the Pacific Veteran entrepreneurs or small business owners can receive business training, counseling and mentoring, and referrals to other SBA Resource Partners at a Veterans Business Outreach Center, sba.gov/vboc. This is also the place to receive procurement guidance, which can help your business better compete for government contracts. 2800 Woodlawn Drive, suite 146 Honolulu (808) 988-1236 [email protected] COURTESY OF THE SBA

12 LOCAL BUSINESS ASSISTANCE

To report how a proposed federal regulation could unfairly affect you, Your find your regional SBA advocate at sba.gov/advocacy.

To submit a comment about how your business has been hurt by an Advocates existing regulation, visit The SBA’s offices of advocacy and ombudsman are sba.gov/ombudsman/comments independent voices for small business within the federal government.

Advocacy When you need a voice within the federal » when you need economic and small » seek remedies when rules are government for your interests as a small business statistics inconsistently applied business owner, the SBA’s regional advocates The SBA’s Office of Advocacy also » recover payment for services done by are here to assist. The advocates analyze the independently represents small business and government contractors effects of proposed regulations and consider advances its concerns before Congress, the alternatives that minimize the economic White House, federal agencies, federal courts, Make your voice heard by participating in a burden on small businesses, governmental and state policy makers. Regional Regulatory Enforcement Fairness jurisdictions, and nonprofits. Find your Roundtable or a public hearing hosted by the regional advocate at sba.gov/advocacy. Ombudsman SBA’s national ombudsman. These events Entrepreneurs who have an issue with an are posted periodically on the ombudsman Your advocate helps with these small existing federal regulation or policy can website, . business issues: sba.gov/ombudsman receive assistance from the SBA’s national To submit a comment or complaint through » if your business could be negatively ombudsman. the online form, visit sba.gov/ombudsman/ affected by regulations proposed by the . Your concerns will be directed to The ombudsman’s office helps you: comments government the appropriate federal agency for review. The » resolve regulatory disputes with federal » if you have contracting issues with a SBA will collaborate with you and the agency federal agency agencies to help resolve the issue. » reduce unfair penalties and fines 13 LOCAL BUSINESS ASSISTANCE

Lawson & Associates owner Tracy Lawson completed a three-year business growth plan

in the SBA Emerging Leaders program. COURTESY OF THE SBA How to Start a Business in Hawaii Thinking of starting a business? Here are the nuts & bolts.

The Startup Logistics regulations when choosing a site for your business. Contact Even if you’re running a home-based business, you will have to the local business license office where you plan to locate your comply with many local, state, and federal regulations. Do not business. You may not be permitted to conduct business out of ignore regulatory details. You may avoid some red tape in the your home or engage in industrial activity in a retail district. beginning, but your lack of compliance could become an obstacle » Hawaii department of Commerce and Consumer Affairs as your business grows. Taking the time to research regulations cca.hawaii.gov/overview is as important as knowing your market. Carefully investigate the laws affecting your industry. Being out of compliance could Name Registration leave you unprotected legally, lead to expensive penalties, and Register your business name with the county clerk where your jeopardize your business. business is located. If you’re a corporation, also register with the state. » State of Hawaii Basic Business Application Market Research hawaii.gov/dcca/bac Need to do research on your clients and location? View consumer and business data for your area using the Census Business Taxes Builder: Small Business Edition, https://cbb.census.gov/sbe. As a business owner, you should know your federal tax Filter your search by business type and location to view data on responsibilities and make some business decisions to comply your potential customers, including consumer spending, and a with certain tax requirements. The IRS Small Business and Self- summary of existing businesses, available as a map and a report. Employed Tax Center, go.usa.gov/xPxYR, offers information on a variety of topics including: obtaining an Employer Identification Business License & Zoning Number, paying and filing income tax, virtual workshops, forms, Licenses are typically administered by a variety of state and publications. and local departments. It is important to consider zoning 14 LOCAL BUSINESS ASSISTANCE

McKinley Car Wash owners Craig, left, and Max Yoshikawa grew their family-owned full-service

COURTESY OF SEAN MARRS gas station in Honolulu thanks to SBA assistance.

As the IRS continues to implement some of the Tax Cuts and E-Verify, operated by the Department of Homeland Security Jobs Act provisions, your tax obligations may change. Visit the in partnership with the Social Security Administration, Tax Reform Provisions that Affect Businesses page on irs.gov for electronically verifies the Social Security number and the latest tax reform updates that affect your bottom line. employment eligibility information reported on Form I-9. It’s » State Taxes the quickest way for employers to determine the employment Hawaii State Department of Taxation Taxpayers Services Branch eligibility of new hires. Visit e-verify.gov, call (888) 464-4218 or 830 Punchbowl St. email [email protected]. Honolulu (808) 587-4242 Health & Safety All businesses with employees are required to comply with state hawaii.gov/tax/a1_forms.htm and federal regulations regarding the protection of employees, » Business Action Centers Oahu, Maui and Hilo visit dol.gov for information. The Occupational Safety and Health [email protected] Administration provides information on the specific health and safety standards used by the U.S. Department of Labor. Call (800) Social Security 321-6742 or visit osha.gov. If you have any employees, including officers of a corporation but not the sole proprietor or partners, you must make periodic » U.S. Dept. of Labor payments, and/or file quarterly reports about payroll taxes and 300 Ala Moana Blvd., room 7–227 other mandatory deductions. You can contact the IRS or the Honolulu Social Security Administration for information, assistance, and (808) 541-2933 forms, at (800) 772-1213 or visit socialsecurity.gov/employer. Fax (808) 541–2904 You can file W-2s online or verify job seekers through the Social » Hawaii Department of Labor and Industrial Relations Security Number Verification Service. 830 Punchbowl St., suite 321 Honolulu Employment Eligibility Verification (808) 586-8844 The Federal Immigration Reform and Control Act of 1986 requires labor.hawaii.gov employers to verify employment eligibility of new employees. » Hawaii State Department of Health The law obligates an employer to process Employment Eligibility health.hawaii.gov Verification Form I-9. The U.S. Citizenship and Immigration Service offers information and assistance through uscis.gov/i-9- » Hawaii Department of Health and Safety central. For forms call (800) 870-3676. For the employer hotline dlnr.hawaii.gov/dsp/health-safetys call (888) 464-4218 or email [email protected].

15 LOCAL BUSINESS ASSISTANCE

L-R, Banan cofounders Zak Barry, Matthew Hong & Luke Unterman

Banan cofounders, left to right, Zak Barry, Matthew Hong & Luke Unterman grew their business thanks to assistance from the Hawaii SBDC. Zak developed a growth plan and networked with other business leaders in the Emerging Leaders program. BANAN OF COURTESY

Employee Insurance Accessibility and ADA Compliance Check with your state laws to see if you are required to provide For assistance with the Americans with Disabilities Act, call the unemployment or workers’ compensation insurance for your ADA Center at (800) 949-4232 or the Department of Justice at employees. For health insurance options, call the Small Business (800) 514-0301. Direct questions about accessible design and the Health Options Program at (800) 706-7893 or visit healthcare. ADA standards to the U.S. Access Board at (800) 872-2253, TTY gov/small-businesses/employers. (800) 993-2822, [email protected] or visit access-board.gov. Department of Labor Association Health Plans allow small businesses, including self-employed workers, to band together Child Support by geography or industry to obtain healthcare coverage as if Employers are essential to the success of the child support they were a single large employer. For information, visit dol.gov/ program and are responsible for collecting 75% of support general/topic/association-health-plans and cca.hawaii.gov/ins nationwide through payroll deductions. The Office of Child Support Enforcement at Health and Human Services offers Environmental Regulations employers step-by-step instructions for processing income State assistance is available for small businesses that must withholding orders for child support. Download the fact sheet comply with environmental regulations under the Clean Air Act. about the Employer’s Role in the Child Support Program at the State Small Business Environmental Assistance programs provide Office of Child Support Enforcement’s website at acf.hhs.gov/ free and confidential assistance to help small business owners programs/css > employer responsibilities. You can also find understand and comply with complex environmental regulations information about other employer responsibilities and tools that and permitting requirements. These state programs can help can make meeting those responsibilities easier, such as electronic businesses reduce emissions at the source, often reducing income withholding orders and the Child Support Portal. Send regulatory burden and saving you money. To learn more about questions to [email protected]. these free services visit nationalsbeap.org/states/list. » https://health.hawaii.gov/oeqc/

16 LOCAL BUSINESS ASSISTANCE CARLA WITT FORD

Intellectual Property A trademark or service mark includes any word, name, symbol, Patents, trademarks, and copyrights are types of intellectual device, or any combination, used or intended to be used to property that serve to protect creations and innovations. identify and distinguish the goods/services of one seller or The United States Patent and Trademark Office is the federal provider from those of others and to indicate the source of agency that grants U.S. patents and registers trademarks. For the goods/services. Trademarks and service marks may be information and resources about U.S. patents and federally registered at both the state and federal level. The U.S. Patent registered trademarks consult uspto.gov. Call the patent and and Trademark Office only registers federal trademarks and trademark office help center at (800) 786-9199 or Silicon Valley service marks. Federally registered trademarks may conflict with and supersede those registered only at the state level. Visit USPTO in San Jose, California, uspto.gov/siliconvalley. A patent for an invention is the grant of a property right to an uspto.gov/trademarks. inventor, issued by the U.S. patent office. The right conferred by the » State Trademark patent grant is the right to exclude others from making, using, offering cca.hawaii.gov/breg/registration/trade for sale, or selling the invention in the United States or importing the Copyrights protect original works of authorship including literary, invention into the country. For information visit uspto.gov/inventors. dramatic, musical and artistic, and certain other intellectual There are three types of patents: works. Copyrights do not protect facts, ideas, and systems, • Utility patents may be granted to anyone who invents or although they may protect the way they are expressed. discovers any new and useful process, machine, manufacture, For general information contact: or composition of matter, or any new and useful improvement. » U.S. Copyright Office • Design patents may be granted to anyone who invents a new, U.S. Library of Congress original, and ornamental design for an article James Madison Memorial Building of manufacture. 101 Independence Ave. SE • Plant patents may be granted to anyone who invents or Washington, DC discovers and asexually reproduces any distinct and new (202) 707-3000 or toll free (877) 476-0778 variety of plant, other than a tuber propagated plant or a copyright.gov plant found in an uncultivated state.

17 LOCAL BUSINESS ASSISTANCE

Hawaii Science & Technology Council Chambers of Commerce hawaiiscitechcouncil.org African American Commercial Council Hawaii Hawaii Technology Development Center chamber-commerce.net/dir/4660 (808) 539-3806 htdc.org Chinese Chamber chinesechamber.com Honolulu City & County (808) 768-5761 East Oahu honolulu.gov hikaicoc.com Honolulu Minority Business Development Filipino Chamber filipinochamber.org Agency Business Center (808) 956-0850 Hawaii Island honolulumbdacenter.com hicc.biz Kauai County Hawaii Islands Kauai cochawaii.org (808) 241-4946 kauai.gov/oed Hawaii Korean Chamber hawaiikoreanchamberofcommerce.org Maui Economic Development Board (808) 875-2300 Hawaii Rainbow medb.org hirainbowchamber.org Maui County Hong Kong-China-Hawaii (808) 270-7710 hkchcc.org co.maui.hi.us/oed

Honolulu Japanese Chamber Maui County Business Resource Center hjcc.org (808) 873-8247 hi-mauicounty.civicplus.com/mcbrc Japanese Chamber jccih.org Maui Economic Opportunity Inc. Wailuku (808) 249-2990 Kailua meoinc.org kailuachamber.com Molokai Kuhaʼo Business Center Ka’u (808) 553-8100 kauchamber.org co.maui.hi.us/index.aspx?nid=1047

Kauai Pacific Asian Center for Entrepreneurship kauaichamber.org (808) 956-5083 pace.shidler.hawaii.edu Kona-Kohala kona-kohala.com Pacific Gateway Center (808) 851-7010 Maui pacificgatewaycenter.org mauichamber.com Maui Native Hawaiian Chamber Exporting Assistance mnhcoc.org Foreign Trade Zone #9 Molokai (808) 586-2507 molokaichamber.org ftz9.org

Vietnamese American Chamber Hawaii Business Development and Support Division vacch.org (808) 587-2750 invest.hawaii.gov/exporting/histep

Economic Development Hawaii Export Assistance Center Hawaii County (808) 522-8041 Honolulu export.gov/hawaii (808) 961-8366 x99 hawaii-county.com

18 LOCAL BUSINESS ASSISTANCE

Not sure whether How Do I you need an EIN? Check out this guide from the IRS. Answering yes to any of the questions in the list means you Find an EIN? need one for your business. Do you have employees? ❒ YES ❒ NO How to apply for an EIN The easiest way to apply for your EIN is Do you operate your business as a online via the IRS EIN Assistant. As soon as corporation or a partnership? your application is complete and validated, you’ll be issued an EIN. There is no charge ❒ YES ❒ NO for this service (beware of internet scams that will try to sell you their EIN application Do you file any of these services). tax returns: employment, You can also apply by mail or fax using excise, or alcohol, tobacco Form SS-4, available at irs.gov/formss4. and firearms? ❒ YES ❒ NO Changing your business No doubt, there are probably quite a few structure? Get a new EIN regulatory and administrative items on your As your business grows and matures, you Do you withhold taxes on income, new business checklist, like getting a permit may choose to change its legal or ownership other than wages, paid to a and registering your business name. structure. For example, a sole proprietor non-resident alien? One of the key requirements for most may decide to incorporate, or a partnership ❒ YES ❒ NO new businesses (or businesses that are may be taken over by one of the owners to restructuring) is obtaining an Employer then operate as a sole proprietorship. In Do you have a Keogh plan? Identification Number, or EIN, from the IRS. instances such as these, your business will Here’s what you need to know about need a new EIN. ❒ YES ❒ NO EINs and how to go about getting one There are other scenarios that require for your business. a new EIN, such as bankruptcy, a change Are you involved with any of the in a corporation’s name or location, or following types of organizations? What is an EIN? reorganization of a corporation. Check out An EIN is a unique nine-digit number that • Trusts, except certain grantor-owned "Do You Need a New EIN" on irs.gov. identifies your business for tax purposes. revocable trusts, IRAs, Exempt Organization Business Income Tax Think of it as the business equivalent Using your EIN to make Returns of a social security number (although it tax deposits • Estates shouldn’t be used in place of it). If you have employees, you will have been As a business owner, you’ll need an EIN automatically enrolled in the Electronic • Real estate mortgage investment to open a business bank account, apply for Federal Tax Payment System (eftps.gov) conduits business licenses, and file your tax returns. when you applied for your EIN. This allows • Nonprofit organizations It’s a good idea to apply for one as soon as you to make tax deposits, including federal • Farmers’ cooperatives you start planning your business. This will employment and corporate taxes, online or • Plan administrators ensure there are no delays in getting the by phone. appropriate licenses or financing that you ❒ YES ❒ NO need to operate. Lost your EIN? If you lost or misplaced your EIN, you can Who needs an EIN? retrieve it in the following ways: An EIN is needed by any business that retains employees. However, non employers • Reference the original notice issued by They should be able to retrieve your are also required to obtain one if they the IRS when you received your EIN, or number. operate as a corporation or partnership. call the IRS Business & Specialty Tax Line • Find an old tax return. Your EIN should be Answering yes to any of the questions in at (800) 829-4933. on it. the list on the right means you need one for • If you used it to open a bank account or your business. get a license, contact these organizations. written by Caron Beesley, contributor

19 LOCAL BUSINESS ASSISTANCE 10 Tips to Help You Build and Grow a Stand-Out Small Business Brand Build a better business with these time-tested tips.

Elliot Henry, who received SBA- backed 7(a) and 504 loans, runs Unlimited Water Processing in St. Louis, MO.

The United States loves small businesses. That’s according to niche, the target customer is very defined. Business operations a survey by the Pew Foundation reported by Small Business are agile and unconstrained by corporate rules and processes. Trends, smallbiztrends.com, which found that 71% of Americans Small businesses are also trusted for their integrity, community view small business more favorably than any other institutions, engagement, and customer service. When was the last time you including religious organizations. called a small business and got put through to an automated call Why is this? Well, small businesses are seen as a positive influence. center? These things come together to create a hugely competitive But it’s more than that. value proposition, the linchpin of your brand. Small businesses are in a unique position to create valuable But what can you do to leverage these experiences and grow the customer experiences. Their products and services are often appeal of your brand without breaking the bank?

20 LOCAL BUSINESS ASSISTANCE

What is Your Brand? Have a Distinct Voice It’s important to understand that your brand is much A great way to ensure your distinct brand message more than your logo, merchandising or products. It is is delivered consistently across your business is to all the experiences customers have with your business, focus on how you and your employees interact and 1including the visual elements of your business. It also includes 6communicate with customers in person, on the phone, and what you do, how you do it, customer interactions, and your on social media. Not sure what your “voice” should be? Look marketing. All of these elements help establish the trust and to other brands. What do they do that you’d like to emulate? credibility of your business. How do they greet and interact with you? What is it they do that makes you feel good about doing business with them? Stand Out If your brand is going to be strong, you need to be able Build Community Around What you Do to pinpoint what makes you different from competitors. A successful brand is one trusted and respected by A SCORE mentor, sba.gov/score, can help you use customers. Building a strong community online and 2competitive differentiators to build your business brand. off can help you achieve this. You don’t have to spend Don’t forget to weave your differentiators into your company’s 7a lot of money to do this. In fact, many successful brands messaging and marketing. concentrate almost exclusively in online and offline community building. Offline participation in community activities, such as Have Great Products and Services local events, fundraisers, and charities, as well as hosting your Word of mouth is often a small business’s greatest lead own events, such as workshops or loyal customer events, can all generator, so having great products and services that help you build community and extend the trust your brand has people talk about is a critical part of your brand. Even earned. 3the most outgoing and charming small business owner is not going to succeed in bringing customers back unless the product Be an Advocate for Your Business— or service they provide delivers and exceeds expectations. Don’t Not Just a Salesman lose sight of your product, keep refining it, testing new offerings, You don't have to be the greatest salesman to succeed and making sure you always put product first. in business. Selling takes many forms, and being a 8brand advocate gels them. For example, many small business Make Sure Your Customers Know owners strive to be the number one salesman, the number one the Face Behind the Product cheerleader, and the number one fan of their own business. If One of the biggest reasons that small businesses fail you are passionate about your business, be an advocate for it. is because of the persistent absence of the business Invite people in! 4owner. You only need to look at a few episodes of business makeover TV shows to witness what can go wrong when a Be Reliable business is left to run itself. Without an actively engaged owner, Letting your customers down by failing to live up employees lose motivation and structure, which can quickly to your own promises and brand standards can be lead to sloppy service, a poor product, and customer churn. Yes, particularly harmful for small businesses that depend your business needs to be able to function without your constant 9heavily on referrals. The foundation of brand loyalty lies in great presence, but it’s important to strike a balance. Find ways to service; a happy customer is a loyal customer. Make sure you make sure your customers know you and connect with the face aren’t making promises that you can’t keep, whether you run a behind the business. Businesses thrive when the energy of the pizza business and pledge to deliver within 30 minutes, or you’re owner is present. a painting contractor who promises to start a job on a Monday at 9 a.m. sharp. Stand by your promises. Get Your Name and Logo Right It’s important to get this right the first time because Have a Value Proposition changing your name and logo later can be costly. Your Value, not to be mistaken with price, can help logo and name should be easily recognizable and define your brand and differentiate you from 5reflect the nature and tone of your business as well as appeal the competition. This goes back to my second to your target market. I’m a dog owner, and two of my absolute 10point about standing out. What niche do you serve? What do you favorite small businesses cater to pet owners: my local provider do well in that niche that makes you different from everyone of dog walking services and a healthful pet food store. When else? What are the emotional benefits of what you do? The I see their logos, it makes me feel good; I feel an affinity with answers to these questions will help define what your value is to them. That’s what you need to shoot for. your customers. It could be your great customer service, product quality, innovation, or a combination of these.

written by Caron Beesley, contributor

21 LOCAL BUSINESS ASSISTANCE

Pick your business location. Are you setting up a brick-and mortar business or 4 launching online? Choose a business structure. The legal structure you choose for your business will affect your business registration requirements, how 5much you pay in taxes, and your personal liability.

Choose your business name. Pick a name reflecting your brand. Check your secretary of state's website to make sure your business name isn’t 6already being used.

Register your business. Once you’ve picked the perfect business name, it’s time to make it legal and protect your brand. If you’re 7doing business under a name different than your own, you’ll need to register with the federal government and often your state government.

Get federal and state tax IDs. You’ll use your Employer Identification Number for important steps to start and grow your business, 8like opening a bank account and paying taxes. It’s like a social security number for your business. Some, but not all, states 10 STEPS require you to get a tax ID as well.

to Start Your Apply for licenses and permits. Keep your business running smoothly by staying legally compliant. The licenses and permits you need for your Business 9business vary by industry, state, and location. Starting a business involves planning, making Open a business bank account. key financial decisions, and completing a A small business checking account can help you series of legal requirements. 10 handle legal, tax, and day-to-day issues.

Conduct market research. This will tell you if there’s an opportunity to turn your idea into a successful business. Gather information about 1potential customers and businesses already operating in your area so you can use that information to find a competitive advantage.

Write your business plan. This is the roadmap for how to structure, run, and grow your new business. You’ll use it to convince people that working 2with you and/or investing in your company is a smart choice.

Fund your business. Your business plan will help you figure out how much money you’ll need to startup. Investors or lenders will help 3you get the amount you need.

22 LOCAL BUSINESS ASSISTANCE

Need financing? Loan Fee Relief To encourage lending to members of the military community who want to start or grow their business, the SBA reduces upfront guarantee fees on select loans. That means the cost savings will be passed down to you, the eligible veteran or qualifying military member. Ask your local SBA district office or SBA Lender about the Veterans Advantage program. Have an employee who was called to active duty?

COURTESY OF LIFEHEALTH OF COURTESY You may receive funds that enable your business to meet ordinary and necessary HOW THE SBA HELPED US SUCCEED operating expenses when an essential Margot Adam Langstaff, left, and Elisa Hamill, right, sought assistance from their employee is called up to active duty in the local Veterans Business Outreach Center, which helped them better compete for military reserve. Ask your local SBA district government contracts. LifeHealth of Littleton, CO has expanded to more than 30 office or SBA Lender about the Military states with offices in Washington, DC and San Antonio, TX. Their clients include the Reservist Economic Injury Disaster Loan. Department of Defense, the National Guard, and the Indian Health Service. They also expanded their business using an SBA-backed line of credit for $350,000. Margot Interested in contracting? started her career as an Army medic, eventually running one of the largest outpatient Veteran-owned and service-disabled clinics in the Northeast at Ft. Devens, MA. veteran-owned small businesses interested in federal contracting receive training from the Veteran Institute for Procurement, which offers a platform with three Opportunities training programs to assist veterans. Visit nationalvip.org. for Veterans VIP Start Members of the military community can start and grow their small Enter the federal market and become ready businesses with the help of SBA programs. for procurement. Nearly 200 veteran-owned businesses from 29 states plus Washington, Need entrepreneurship training? For women veterans DC have graduated from the program. In Boots to Business, you explore Receive entrepreneurial training geared VIP Grow business ownership and other self- toward women veterans, service members, Strategize to expand and operate within employment opportunities while learning and spouses of service members through the federal marketplace. More than 700 key business concepts. You will walk away these SBA-funded programs: veteran-owned businesses from 42 states with an overview of entrepreneurship » Veteran Women Igniting the Spirit of plus DC and Guam have graduated from and applicable business ownership Entrepreneurship in Syracuse, New York this program. fundamentals, including how to access VIP International startup capital using SBA resources. » LiftFund in San Antonio, Texas Enter or expand your federal and commercial Boots to Business is conducted on all For service-disabled veterans contracting opportunities overseas. military installations as part of the Learn how to start and grow a small business Department of Defense’s Transition Get certified using these SBA-funded programs: Assistance Program. Learn about the service-disabled veteran- » Entrepreneurship Bootcamp for Veterans owned small business certification program Who’s eligible? with Disabilities in Syracuse, New York on page 49. Service members transitioning out of » Veterans Entrepreneurship Program at active duty and military spouses. For more assistance the Riata Center for Entrepreneurship, Are you a veteran or member of Veteran and military entrepreneurs Spears School of Business, Oklahoma the National Guard or Reserve or a receive business training, counseling, and State University in Stillwater, Oklahoma military spouse? Boots to Business: referrals to other SBA Resource Partners Reboot teaches this entrepreneurship » Veteran Entrepreneurship Jumpstart at at a Veterans Business Outreach Center, curriculum off base and in local St. Joseph’s University in Philadelphia, sba.gov/vboc. For veterans business communities. Register for either B2B Pennsylvania information visit sba.gov/veterans. program at https://sbavets.force.com. » Dog Tag Inc., affiliated with Georgetown University in Washington, DC 23 LOCAL BUSINESS ASSISTANCE Write your Business Plan Your business plan is the foundation of your business. Learn how to write a business plan with the help of an SBA Resource Partner. TRADITIONAL BUSINESS PLAN FORMAT When you write your business plan, you don’t have to stick to the exact business plan template. Instead, use the sections that make the most sense for your business and your needs. Executive Summary Briefly summarize your company and why it will be successful. Include your mission statement, your product or service, and basic information about your company’s leadership team, employees, and location. You should also include financial information and high-level growth plans if you plan to ask for financing. Company Description Go into detail about the problems your business solves. Be specific as to audience and location. List out the consumers, organizations, or businesses your company plans to serve. Explain the competitive advantages you have that will make your business successful. Are there experts on your team? Have you found the perfect location? Your company description is the place to boast about your strengths. Market Analysis Demonstrate a solid understanding of your industry outlook and tar- get market. This is where it pays to partner with an experienced busi- ness counselor from your local Small Business Development Center, SCORE, Women's Business Center, or Veterans Business Outreach Center—all these SBA Resource Partners provide free or low-cost business assistance. Competitive research will show what other busi- nesses are doing and their strengths. In your market research, look for trends and themes. What do successful competitors do? Why does it work? Can you do it better? Now's the time to answer these questions. Business plans help you run your business. A good business plan guides you through managing your business. Organization and Management You’ll use your business plan as a roadmap for how to structure, run, Explain how your com- and grow your new business. pany will be structured Business plans can help you get funding or bring on new and who will run it. business partners. Investors want to see a return on their Describe the legal Want to see an investment. Your business plan is the tool you’ll use to convince structure of your busi- example of a people that working with you—or investing in your company—is ness. State whether you a smart investment. Brain storm with a business counselor (visit have or intend to incor- business plan? one of our SBA Resource Partners detailed on page 10) and write porate your business as View examples of business plans a C or an S corporation, a traditional business plan, which uses a standard structure at sba.gov/business-guide/plan/ form a general or limited and detailed sections. Once you've got it all down, you can then write-your-business- condense it to a lean startup business plan, which typically partnership, or if you're a plan-template contains key points on only one page. sole proprietor or limited liability company.

24 LOCAL BUSINESS ASSISTANCE

LEAN STARTUP PLAN FORMAT TRADITIONAL BUSINESS PLAN CHECKLIST Write a lean startup plan if requested from an investor, or if your ❒ Executive summary business is relatively simple or you plan to regularly change and refine as you go. ❒ Company description Lean startup plans use more visual organization tools and only a ❒ Market analysis handful of elements to describe your company’s value proposition, ❒ Organization and management infrastructure, customers, and finances. They’re useful for visualiz- ing your company's fundamental facts. Your business counselor can ❒ Service or product line help you edit down into the Business Model Canvas, used here—the ❒ Marketing and sales most well known style, or another lean startup template. ❒ Funding request Key Partnerships ❒ Financial projections Note the other businesses you’ll work with--suppliers, manufactur- ers, subcontractors, and similar strategic partners. ❒ Appendix Key Activities List the ways your business will gain a competitive advantage. Use an organizational chart to show the hierarchy. Explain how Will you sell direct to consumers or use technology to tap into the each person’s experience will contribute to the success of your sharing economy? venture. Consider including CVs of key members. Key Resources Service or Product Line List resources you’ll leverage to create value for your customer. Describe what you sell or what service you offer. Explain how it ben- Your most important assets include staff, capital, or intellectual efits your customers and the product lifecycle. Share your plans for property. Leverage business resources that might be available intellectual property, like copyright or patent filings. If you're doing to women, veterans, Native Americans, and HUBZone–certified research and development for your service or product, explain it. businesses. Marketing and Sales Value Proposition Your marketing strategy should evolve and change to fit your needs Make a clear and compelling statement about the unique value in each context. your company brings to the market. Describe how you'll attract and retain customers. Show how a sale will actually happen. You'll refer to this section later when you Customer Relationships make financial projections, so be thorough. Describe how customers will interact with your business. Think through the customer experience from start to finish. Is it auto- Funding Request mated or personal? In person or online? If you're asking for funding, outline your funding requirements. Specify whether you want debt or equity and the terms you'd like. Customer Segments Your goal is to clearly explain how much funding you’ll need over Name your target market. Your business won’t be for everybody; the next five years and how the investment will be used. it’s important to have a clear sense of who you serve. Specify if you need funds to buy equipment or materials, pay Channels salaries, or cover specific bills until revenue increases. Explain how List the most important ways you’ll talk to your customers. you'll pay off the debt. Cost Structure Financial Projections Will your company focus on reducing cost or maximizing value? Supplement your funding request with a prospective financial Define your strategy, then list the most significant costs you’ll face. outlook for the next five years. Show how your business will be a Revenue Streams financial success. Explain how your company makes money: direct sales, member- If your business is already established, include income state- ships fees, selling advertising space? If your company has multiple ments, balance sheets, and cash flow statements for the last three to revenue streams, list them all. five years. List collateral you could put against a loan. Include forecasted income statements, balance sheets, cash flow statements, and capital expenditure budgets. For the first year, be even more specific and use quarterly—or even monthly —projections. Make sure to clearly explain your projections and LEAN STARTUP PLAN CHECKLIST match them to your funding requests. ❒ Key partnerships ❒ Customer segments Use visual organization tools--graphs and charts—to tell your ❒ Key activities ❒ Channels business's financial story. ❒ Key resources ❒ Cost structure Appendix Here you'll attach supporting documents or other requested ❒ Value proposition ❒ Revenue streams materials. Common items to include are credit histories, CVs, ❒ Customer relationships product pictures, letters of reference, licenses, permits, patents, legal documents, and other contracts.

25 local success story

Rolf Klein, CEO Alvin Bongolan, COO

HAWAII ENERGY SYSTEMS

Aiea, HI

Rolf Klein and Alvin • What challenge did you have? We always wanted to expand here in Aiea and Bongolan wanted to handle make a difference in our community. We knew that meant owning our own their business’s growth facility. Access to capital is always a challenge for small businesses. We are a with care, so they turned government contractor and we had a business line of credit, but we still couldn’t to the SBA for financing find traditional financing in order to purchase the facility we needed. assistance. Their small We’ve also had difficulties getting skilled professionals for a young, fast grow- business provides energy ing company. management systems throughout the Pacific. With • What was the SBA solution? Our small business qualified for an SBA-backed the help of an SBA-backed 504 Certified Development Company Loan. The SBA guarantees loans made loan, Hawaii Energy Systems by lending institutions to small businesses that would not otherwise be able to bought its own facility in Aiea. obtain financing. Our SBA-backed loan allowed us to purchase our building with An electrical, mechanical, a long-term, fixed-rate mortgage. Our new 10,400-square-foot facility provides and low voltage systems contractor, Hawaii Energy meaningful employment and gives us room to grow. The SBA was a huge help; Systems serves private and without our Hawaii district office, we wouldn't be where we are today. The SBA public sector clients with has continued to be instrumental in assisting us in growing our business. We’ve state-of-the-art building consulted with our local SBA specialists on everything from marketing to han- automation systems like dling the customers and cash flow. To address our hiring issue, we established Distech Controls, Optergy, and an internship program with engineering students from local universities. Honeywell technology. They continue to receive expert • What benefit did this have for you? We feel we are part of the SBA family. We business guidance from the started up in 2006 and since then the company has experienced continuous SBA Hawaii District Office. growth. We now have a staff of over 40 skilled employees with sales of over $7 million, an increase of about 56% over the last two years.

26 Hawaii Energy Systems Chief Operating Officer Alvin

Bongolan, left, and Chief Executive Officer Rolf Klein. COURTESY OF THE SBA

The SBA has continued to be instrumental in assisting us in growing our business.” Rolf Klein, CEO & Alvin Bongolan, COO Hawaii Energy Systems

27 FUNDING PROGRAMS Financing Your Small Business

How We Did It Crafting a

BusinessSBA-backed financing helped Superstition Meadery expand into a multimillion dollar enterprise. written by Becky Bosshart COURTESY OF SUPERSTITION MEADERY SUPERSTITION OF COURTESY 28 FUNDING PROGRAMS

ennifer and Jeff Herbert’s Solution home-based brewing has Thanks to guidance from an SBA expanded into a global, Resource Partner, the Small Business multimillion dollar Development Center at Yavapai enterprise thanks to SBA Community College, Jennifer and Jeff FUNDING PROGRAMS assistance. Using Arizona honey and learned about financing that worked Jingredients they’ve sourced from for them. The SBA guarantees loans Financing Your Small Business around the world (such as Tahitian made by lending institutions to small vanilla and Moroccan saffron), the business that would not otherwise be Herberts are selling nearly 30,000 able to obtain financing. Their small Tips for gallons annually of their honey-based business qualified for two SBA-backed fermented beverage. They operate a loans totaling more than $600,000. The downtown Prescott, Arizona tasting Herberts’ first SBA-backed loan allowed Success room and state-of-the-art production them to acquire commercial property to 5 facility, creating jobs and building design and build their mead production Get guidance. a local craft industry. The Herberts, facility. Their second SBA-backed loan Develop a working relationship with an founding members of the American provided the funding for professional SBA Resource Partner (see page 10) to Mead Makers Association, have brewing equipment to complete their help you find the funding that works traveled around the world hosting 7,450-square-foot production space. The best for you. pairing events and pouring at craft Herberts recently purchased a historic beverage festivals. building in downtown Phoenix, Arizona Define your lending needs. Challenge to open a mead-pairing restaurant. Determine if a loan is right for you. Is Benefit The Herberts wanted to scale up their this the right time? How much do you The Herberts started with two meadery while also staying true to need? What are you going to use it for? their values of quality ingredients and employees and now have over 20 craft process. It is often difficult for producing 29,000 gallons this year. new entrepreneurs or unique concepts From a homegrown setup, Jennifer and Talk to multiple lenders. Jeff are now charting revenue in excess like a meadery to get traditional See who best matches you and your financing, even though they knew of $2.6 million and distributing to 37 business. Has the lender successfully they had a great idea, the backing states, across Europe and Southeast worked with other businesses in wasn’t there to expand. They say that Asia. They have plans for another your industry? choosing to do something new breaks expansion, including a shipping the mold, which can be uncomfortable warehouse to manage their online retail for traditional lenders. and wholesale orders. Check all options. Consult with your lender to see if you’re eligible for SBA financing programs, determined by your industry & experience; collateral; credit score; and the relationship & transparency you develop with the lending agent.

Be ready for the ups and downs. Your entrepreneurial endeavor will be a roller coaster ride filled with challenges and successes. The path is all consuming so make sure that you love what you do. Passion is the price of admission.

Jeff & Jennifer Herbert, owners of Superstition Meadery, completed their 7,450-square- foot production space and opened a tasting room in Prescott, AZ with the assistance of SBA-backed financing. See their story on YouTube by searching for the 2019 National

COURTESY OF SUPERSTITION MEADERY SUPERSTITION OF COURTESY Small Business Persons of the Year.

29 FUNDING PROGRAMS

Lender SBA-backed Loans help small business owners and entrepreneurs who are Match creditworthy but don’t qualify for conventional financing. Find a lender interested If you cannot obtain a business loan with reasonable rates in working with you at sba.gov/lendermatch. and terms, contact your local SBA Lender to see if you are This matching tool eligible for SBA programs. The SBA works with participating connects entrepreneurs lenders to reduce their risk, increasing the likelihood your with SBA Lenders in loan will be approved with the terms that work best for your area. you. The guarantee is conditional on the lender following SBA program requirements. Just like with any other loan, you make your loan payments directly to your lender in accordance with your terms.

Small businesses power our economy. The SBA powers small businesses.

Whether you dream of transforming your business idea into a thriving company, growing your customer base, or expanding into new markets or locations, the SBA is here for you. We offer programs, expertise, and access to capital that will empower you to take your small business to the next level of success.

Stop by your local SBA office or visit SBA.gov to learn how you can move your business forward with confidence.

30 FUNDING PROGRAMS

SBAOur participating SBA Lenders Lenders serve all of the Hawaii district. To find more bank locations, visit the lender’s website.

STATEWIDE LENDERS Hawaii National Bank ISLAND OF MAUI American Savings Bank Hilo (808) 935-8551 American Savings Bank (808) 627-6900 hawaiinational.bank Wailuku (808) 244-9248 asbhawaii.com Kahului (808) 871-8411 Hawaii State Federal asbhawaii.com Bank of Hawaii Credit Union (888) 643-3888 Hilo (808) 961-6691 Bank of Hawaii boh.com hawaiiusafcu.com Kahului (808) 871-8218 Kihei (808) 874-1100 Central Pacific Bank HawaiiUSA Federal Credit Union boh.com (808) 544-0500 Hilo (808) 961-6691 centralpacificbank.com hawaiiusafcu.com Central Pacific Bank Kahului (808) 877-3387 First Hawaiian Bank HFS Federal Credit Union Wailuku (808) 249-2570 (808) 844-4444 Hilo (808) 930-1400 centralpacificbank.com fhb.com Kailua-Kona (808) 930-1400 First Hawaiian Bank hfsfcu.org Kahului (808) 877-2311 ISLAND OF HAWAII North Hawaii Community Wailuku (808) 877-2377 fhb.com American Savings Bank Federal Credit Union Hilo (808) 935-0084 Honokaa (808) 775-7251 Kailua-Kona (808) 329-5281 Hawaii National Bank Kahului (808) 877-7575 asbhawaii.com Kihei (808) 879-8877 ISLAND OF KAUAI Bank of Hawaii hawaiinational.bank First Hawaiian Bank Hilo (808) 326-8900 Lihue (808) 245-4024 HawaiiUSA Federal Credit Union Kailua-Kona (808) 935-9701 Kapa’a (808) 822-4966 Kahului (808) 872-1200 boh.com fhb.com hawaiiusafcu.com Central Pacific Bank American Savings Bank Hilo (808) 935-5251 Lihue (808) 246-8844 ISLAND OF OAHU Kailua-Kona (808) 329-4481 Kapa’a (808) 822-0529 centralpacificbank.com American Savings Bank asbhawaii.com (808) 627-6900 First Hawaiian Bank asbhawaii.com Bank of Hawaii Hilo (808) 844-4444 Lihue (808) 245-4024 Kailua-Kona (808) 329-2461 Bank of Hawaii Kapa’a (808) 822-3471 fhb.com Honolulu (808) 832-2750 boh.com boh.com Hawaii Community Federal Central Pacific Bank Central Pacific Bank Credit Union Lihue (808) 245-3311 Honolulu (808) 544-0500 Kailua-Kona Kapa’a (808) 632-6160 centralpacificbank.com (808) 930-7700 centralpacificbank.com hicommfcu.com First Foundation Bank Gather Federal Credit Union Honolulu (808) 585-9600 Hawaii Federal Credit Union Lihue & Kapa’a (808) 245-6791 firstfoundationinc.com Hilo gatherfcu.org (808) 933-6700 hawaiifcu.org

31 FUNDING PROGRAMS

First Hawaiian Bank AMERICAN SAMOA Touchmark Bank Honolulu (808) 844-4444 ANZ Bank of America Samoa (770) 407-6700 fhb.com (684) 633-1151 touchmarknb.com anz.com Hawaii Central Federal Credit United Midwest Saving Bank Union (614) 538-9400 MAINLAND LENDERS Honolulu (808) 536-3677 umwsb.com hawaiicentral.org America First Bank (800) 999-3961 West Town Bank & Trust Hawaii National Bank americafirst.com (708) 447-3330 Honolulu (808) 528-7711 westtownbank.com hawaiinational.bank Celtic Bank (800) 509-6191 Wells Fargo Hawaii State Federal Credit Union celticbank.com (800) 869-3557 Honolulu (808) 587-2700 wellsfargo.com/biz/sba East West Bank hawaiistatefcu.com (888) 895-5650 eastwestbank.com HawaiiUSA Federal Credit Union Participating Certified Honolulu (808) 534-4300 Fin Wise Bank Development hawaiiusafcu.com (801) 545-6000 Company finwisebank.com Honolulu Federal Credit Union HEDCO Local Development Corp. Honolulu (808) 524-4961 First Home Bank 222 S. Vineyard St. PH #1 (727) 440-6848 myhocu.com Honolulu firsthomebank.com/sba (808) 521-6502 Ohana Pacific Bank Five Star Bank hedcoldc.com Honolulu (808) 237-6551 (877) 226-5578 ohanapacificbank.com five-starbank.com Export Assistance

GUAM Homestar Bank Lenders Serving Guam and the Pacific Islands (815) 468-2265 homestarbank.com Alaska Growth Capital ANZ Guam Inc. (907) 339-6760 (671) 479-9000 Incredible Bank alaskagrowth.com anz.com (877) 261-4750 incrediblebank.com Bank of Hawaii Bank of Guam Independence Bank (808) 643-3888 (671) 472-5300 boh.com bankofguam.com (877) 621-1776 1776bank.com/about-us Central Pacific Bank Bank of Hawaii Live Oak Banking Co. (808) 544-0510 (671) 479-3500 (866) 518-0286 centralpacificbank.com boh.com liveoakbank.com ExWorks Capital Community First Guam Newtek Small Business Finance Inc. (312) 443-8508 Federal Credit Union ( 855) 763-9835 exworkscapital.com (671) 472-8210 newtekone.com cfirstguam.com HomeStar Bank Optus Bank (815) 932-5612 Coast360 Federal Credit Union (866) 710-5778 homestarbank.com optus.bank (671) 479-8736 Kauai Government Employees FCU coast360fcu.com Seacoast Bank (808) 245-2463 (866) 710-5778 kgefcu.com First Hawaiian Bank seacoastbank.com (671) 475-7800 fhb.com Stearns Bank US Eagle FCU (800) 320-7262 (505) 342-8888 stearnsbank.com useagle.org

32 FUNDING PROGRAMS Need Financing? Visit your local SBA office or lender to learn about these funding options. The 7(a) Loan, the SBA’s Largest Financing Program If you cannot get conventional financing and you meet the eligibility requirements, you can use a 7(a) loan to buy real estate, equipment, or inventory for your small business. It may also be used for working capital, to refinance business debt or purchase a small business. MAX LOAN AMOUNT: $5 million INTEREST RATE: generally prime + a reasonable rate capped at 2.75% TERMS: loan term varies according to the purpose of the loan, generally up to 25 years for real estate, 10 years for other fixed assets and working capital GUARANTEE: 50 to 90%

CAPLines Microloans Meet your revolving capital needs with lines of credit. CAPLines can Eligible businesses can startup and grow with working be used for contract financing, seasonal lines of credit, builders line capital or funds for supplies, equipment, furniture and fixtures. of credit, or for general working capital lines. Borrow from $500 to $50,000 and access free business counseling from microlenders. SBA Express Loan INTEREST RATE: loans less than $10,000, lender cost + 8.5%; loans Featuring a simplified process, these loans are delivered by $10,000 and greater, lender cost + 7.75% experienced lenders who are authorized to make the credit decision for the SBA. These can be term loans or revolving lines of credit. TERMS: lender negotiated, no early payoff penalty

MAX LOAN AMOUNT: $350,000 504 Certified Development Company Loan INTEREST RATE: for loans less than $50,000, prime + 6.5%; for If you do not qualify for traditional financing, but would like to loans of $50,000 and greater, prime + 4.75% purchase or renovate real estate or buy heavy equipment for TERMS: loan term varies according to the purpose of the loan, your business, ask about the 504 loan. It provides competitive generally up to 25 years for real estate and 10 years for other fixed fixed-rate mortgage financing through a lender and a Certified assets and working capital Development Company. GUARANTEE: 50% MAX LOAN AMOUNT (UP TO 40% OF THE TOTAL PROJECT): up to $5 million; $5.5 million for manufacturing or energy public Community Advantage policy projects A financing program for women, veterans, low-income borrowers, and INTEREST RATE: below market fixed rates for 10, 20 or 25 year terms minority entrepreneurs just starting up or in business for a few years. TERMS: 20 or 25 years for real estate or long-term equipment, Receive free business counseling as you work with a community-based 10 years for general machinery and equipment financial institution. GUARANTEE: the lender provides a senior loan for 50% of the INTEREST RATE: prime + 6% project cost (with no SBA guarantee); the CDC finances up to 40% in TERMS: up to 25 years for real estate, 10 years for equipment and a junior lien position (supported by the SBA guarantee) working capital SPECIAL CONDITION: a minimum borrower contribution, or down GUARANTEE: 75 to 90% payment, is required, amounts vary by project but are usually 10%

33 FUNDING PROGRAMS Go Global with International Trade Businesses that export are more resilient—they are less dependent on any one market. Exporting also stabilizes sales for those who make seasonal products. COURTESY OF THE SBA COURTESY OF THE SBA

Expand your Market finalizing an export sale or contract, so adequate Interest rate: typically not to exceed prime Small businesses can enter and excel in the financing is in place by the time you win your + 6.5% international marketplace using State Trade contract. If you’ve been in business for at least Terms: up to 25 years for real estate, up to Expansion Program grants and training. a year, ask your area SBA regional finance 10 years for equipment, up to seven years Visit sba.gov/internationaltrade to find manager about the Export Working Capital for lines of credit out if your state is participating. program. The International Trade Loan program Guarantee: up to 90% You can: also helps exporters who have been adversely Approval time: 36 hours or less affected by foreign importing competition, • learn how to export helping you better compete globally. • participate in foreign trade missions and Max loan amount: $5 million trade shows Interest rate: for Export Working Capital, the Expert Advice on • obtain services to support foreign market rate is negotiated between borrower and lender. Exporting entry For the International Trade Loan, it also cannot Find an SBA professional in one of the exceed prime + 2.75% for loan amounts over • translate websites to attract foreign buyers 21 U.S. Export Assistance Centers, $50,000 and maturity of seven years or more • design international marketing products sba.gov/tools/local-assistance/ Terms: For Export Working Capital, typically or campaigns eac, located in most major metro one year, cannot exceed three years. For areas. The centers are also staffed by International Trade Loans, up to 25 years for Financing for International Growth the U.S. Department of Commerce real estate, up to 10 years for equipment Having trouble securing capital to meet your and, in some locations, the Export- Guarantee: up to 90% small business exporting needs? Use SBA Import Bank of the United States and international trade programs to cover short Export Express uses a streamlined process other public and private organiza- or long-term costs necessary to sell goods or that expedites the SBA guarantee—what tions. Visit your local Small Business services abroad. Loan proceeds can be used small businesses need most when preparing Development Center (see page 10) for for working capital to finance foreign sales or to export or ramping up international trade exporting assistance from professional for fixed assets, helping you better compete on a fast timeline. business counselors. globally. You can apply for lines of credit prior to Max loan amount: $500,000

34 COURTESY OF THE SBA ◀

HOW THE SBA HELPED US SUCCEED Help with Trade Barriers Small businesses that qualify for the SBA State Trade Expansion Program use If you need assistance with grant proceeds to bolster their international market presence, which EarthQuaker international trade regulations, Devices has done in a seismic way. A manufacturer of guitar special effects the SBA can be your advocate in pedals in Akron, OH, EarthQuaker has built an international social media fanbase foreign markets. Call toll free (855) delivering content in seven languages, generating millions of website page views. 722-4877 or email your contact EarthQuaker owners Julie Robbins & Jamie Stillman developed their global information and trade issue to marketing strategy and multilingual promo materials with the SBA State Trade Expansion [email protected]. Program. The couple also received global marketing counseling and research assistance from the Ohio Small Business Development Center Export Assistance Network. 35 FUNDING PROGRAMS R&D Opportunities for High Growth Startups Engaged in high-risk research and development? Compete for funding to develop your cutting-edge technology.

Do you work in one of these areas? » advanced materials » agTech » artificial intelligence » biomedical » cybersecurity » energy » first response » national security » space exploration The Small Business Innovation Research and the Small Business Technology Transfer programs, also called America’s Seed Fund, provide more than $3.5 billion in early stage capital through a competitive awards process.

How it works Every year, participating federal agencies announce topical areas that address their R&D needs. Eligible businesses submit proposals to win either grants or contracts. There are three phases: » The proof-of-concept stage typically lasts from 6-12 months, and ranges from $100,000-$225,000. » The full R&D period lasts about 24 months and typically provides $600,000- $1.5 million. » The commercialization stage is when you seek public or private funds for your venture. COURTESY OF THE SBA

◀ How your startup benefits

HOW THE SBA HELPED US SUCCEED The funding agency does not take an equity Killer Snails brings science out of the laboratory and into classrooms and living rooms position or ownership of your business. The with award-winning educational games, such as BioDive, Assassins of the Sea, and federal government also protects data rights and Biome Builder. The Brooklyn, NY-based business gained access to startup funding the ability to win sole-source phase III contracts. thanks to the Small Business Innovation Research program. Dr. Mandë Holford, left, Participating agencies: Jessica Ochoa Hendrix, right, and Dr. Lindsay Portnoy envisioned how venomous » Department of Agriculture marine snail research could be used in extended reality and digital learning to engage students and meet educators’ needs. The business has raised more than $1.2 million to » Department of Commerce support a team of full-time employees. Killer Snails’s tabletop, digital, augmented and virtual reality games have won national and international awards.

36 FUNDING PROGRAMS

› National Institute of Standards and Technology › National Oceanic and Atmospheric Administration Investment Capital » Department of Defense Looking for investors? For mature, profitable busi- nesses with sufficient cash flow to pay interest, a Small » Department of Education Business Investment Company can help scale up your » Department of Energy small business. » Department of Health and Human Services How an SBIC works » Department of Homeland Security Investment companies with financing expertise in » Department of Transportation certain industry sectors receive SBA-guaranteed loans, » Environmental Protection Agency which means the federal government is responsible in case of default. These investment companies then use » NASA the SBA-guaranteed capital and private funds to invest » National Science Foundation in qualifying small businesses. Each SBIC has its own Visit sbir.gov to find funding opportunities and helpful program investment profile in terms of targeted industry, geogra- tutorials, as well as past award winners, such as Qualcomm, phy, company maturity, the types and size of financing iRobot, Illumina, and Symantec. they provide.

SBIR Road Tour To be eligible Visit sbirroadtour.com to learn about national events The majority of your employees and assets must be within connecting entrepreneurs working on advanced tech to the the United States. Some ineligible small businesses and country’s largest source of early stage funding. Each SBIR Road activities include relenders, real estate, project financing, Tour stop introduces participating federal agency program and foreign investment. managers, who oversee over 5,000 new awards annually. Visit sba.gov and click on Funding Program and then Investment Capital.

37 FUNDING PROGRAMS DISASTER ASSISTANCE COURTESY OF THE SBA

How I Did It Smiling After the Storm With SBA assistance, Stephanie Vitori rebuilt her Miami Beach, FL restaurant after Hurricane Irma. written by Jess Walker beef cheeseburgers sizzle on the flat-top grill. f you ask Stephanie Vitori, the person who coined the term “bittersweet” Burgers are kept classic, no extra frills. “People must have run a business. In the 15 years Stephanie has owned feel at home,” Stephanie says. “You’re not just Cheeseburger Baby, the Florida burger joint has endured recessions, another table somebody has to serve.” Here, multiple hurricanes, and competition from corporate franchises. She has everybody feels like somebody, she says. So grown along with Cheeseburger Baby, changing with each stage of the many people love a good cheeseburger, which business lifecycle. is why all kinds of people are attracted to her IVitori worked as a delivery driver before purchasing the business in restaurant. Cheeseburger Baby’s handcrafted 2004. Since then, she’s expanded by purchasing two food trucks. She runs patties have been featured on the Food an open kitchen, which means customers can watch their 100% Angus Network and consumed by celebrities such as 38 DISASTER ASSISTANCE FUNDING PROGRAMS

What to do after a Disaster Declaration After a disaster is declared by the President Register with FEMA at disasterassistance.gov, or call (800) 621-3362, TTY 800-462-7585, or visit a Disaster Recovery Center. Locations can be found at fema.gov/drc. Businesses are automatically referred to the SBA. Most homeowners and renters will be referred by FEMA to the SBA to apply for disaster loan assistance. You must complete the SBA application to be considered for assistance. If the SBA cannot help you with a loan for all your needs, the SBA

COURTESY OF THE SBA will in most cases refer you back to FEMA. If you do not complete an SBA application, you may not be Jay-Z and Kanye West. Stephanie has met famous chefs “all through considered for assistance from other agencies. a cheeseburger.” But just as special to her is the Vietnamese couple who came in one day, speaking little English. They were eager to meet Express Bridge Loan Pilot Program Stephanie and show her a napkin with “Cheeseburger Baby” scrawled Businesses affected by a Presidential disaster on it. On the other side of the world, a friend had told them to come, declaration are eligible to receive expedited so they did. It all just goes to show you, Stephanie says, people come financing through an SBA Express lender. These together for a great cheeseburger. funds may be used for disaster-related purposes while the business waits for long-term financing Challenge through the SBA’s direct disaster loan program. Despite these sweet moments, there have also been bitter ones. Loan Amount: $25,000 Hurricane Irma struck in 2017, and Cheeseburger Baby lost equipment Terms: up to seven years and food supplies. Thirty percent of sales blew away with the wind. “It was a zombie zone in South Beach. People were scared to come since Guarantee: 50% they thought everything was destroyed,” Stephanie says. “It was the After a disaster is declared by the SBA roughest road I’ve ever traveled.” Businesses of all sizes, nonprofits, homeowners, and renters are eligible to apply Solution for an SBA disaster assistance An SBA disaster assistance loan aided Cheeseburger Baby’s recovery. loan. Visit a Business Recovery The SBA provides direct low-interest loans to businesses of all sizes, Center or Disaster Loan nonprofits, homeowners, and renters to repair damage or replace Outreach Center in your area or property not covered by insurance or other forms of assistance. visit disasterloan.sba.gov/ela to apply for a loan. SBA disaster assistance loans can also be used to rebuild stronger, You can also call the SBA customer service center protecting your home or business against future damage caused by a at (800) 659-2955, TTY (800) 877-8339, and ask for disaster. The SBA also introduced Stephanie to her local Small an application package. FEMA grant assistance for homeowners or renters is not available under an SBA declaration. Information you need to get started: When you're affected by a disaster the SBA, the Federal • address of damaged residence or business Emergency Management Agency, and other organizations and contact information work together to provide assistance. Once immediate safety and security needs are met, the SBA helps get you and your • insurance information, including type of community back to where you were before the disaster. Since insurance, policy numbers, and amount received low-interest SBA disaster assistance loans are government aid, creditworthiness and the ability to repay are taken into • household and/or business income consideration before a loan is awarded. • description of disaster-caused damage and losses

39 FUNDING PROGRAMS DISASTER ASSISTANCE

The SBA provides direct low-interest loans to Keep businesses of all sizes, nonprofits, homeowners, in and renters to repair mind Since an SBA disaster or replace damaged assistance loan is a direct loan from the property not covered government, other

COURTESY OF THE SBA organizations may by insurance or other reduce or not award Business Development Center, which you a grant if you have provided assistance with financing forms of assistance. received an SBA loan options and marketing. She continues or other assistance for to meet with SBDC advisers every SBA disaster assistance your disaster loss. Be month to remain competitive in an sure to check with the ever-changing economy. loans can also be used organization offering During disasters, the responsibility assistance to see how falls on the owner’s shoulders. But to rebuild stronger, an SBA loan might one lesson Stephanie has learned is affect your eligibility for the value in reaching out to others protecting your home or their program. In gen- for assistance and counsel. While her eral, recovery expenses brick-and-mortar restaurant was being business against future covered by insurance, rebuilt, she sold from a food truck. FEMA or other forms of When the restaurant was operational assistance may reduce again, she advertised that with damage caused by a the amount provided spray paint on the plywood covering by your SBA disaster the broken windows. Stephanie disaster. For information assistance loan. and her wife, Gabrie Vitori, rebuilt Cheeseburger Baby by depending on visit sba.gov/disaster. each other and SBA assistance. See their story on YouTube by searching for the 2019 Phoenix Award for Small Business Disaster Recovery. “You’ve got to have resiliency. You’ve got to swallow your pride sometimes,” Stephanie says. “But you also have to believe in your product.” Get Ready Benefit The Ready Business program, ready.gov/business, For Cheeseburger Baby, that product gives step-by-step guidance on how to prepare will continue satisfying the burger your business for a disaster. The series includes hankerings of locals, celebrities, and preparedness toolkits for earthquakes, hurricanes, tourists alike. Vitori sees expansion in her future—she’d like to have a brick- inland flooding, power outages, and severe winds/ and-mortar restaurant and food truck tornadoes. Spanish materials are available. in each growing town in South Florida. “My whole life is this. I’ve always felt a love for business ownership, ” Vitori says. “That drive keeps you going.”

40 DISASTER ASSISTANCE FUNDING PROGRAMS Getting Back to Business: Six essential preparedness steps for creating a continuity plan The financial and emotional cost of rebuilding a business after a disaster can be overwhelming. With a business continuity plan in place, you can recover more quickly.Your plan also puts you in a better position to contribute to the economic recovery of your community.

1 Establish a communications plan • Test your calling tree or communications list to reach employees to ensure they and their families are safe.

2 3 Protect your documents Review insurance coverage • Keep copies of vital business documents in a digital • Contact your insurance agent to find out if your coverage format or in an accessible, protected off-site location. is right for your business; make sure you understand the policy limits and deductibles. • Ask about business interruption insurance, which compensates you for lost income and covers operating expenses if your company has to temporarily shut down because of a disaster.

Establish a solid supply chain

• If your vendors and suppliers are local and the disaster is widespread, you will all be in the same situation— 4 struggling to recover. Put a disaster response plan in place to get key supplies from companies outside your area. Create a contact list of contractors and vendors you plan to use.

5 6 Plan for an alternative location Practice your plan with your staff • Identify several places to relocate your operations in case Based on your location, assess your risk you must close your primary location for an extended time. for every type of emergency. • Consider creative options for available office space, including • Discuss as a group how your plan would be affected by sharing space and resources with other businesses. different types of disasters, such as an earthquake, tornado, • Allow employees to telecommute until your location reopens. flood, mudslight, or hurricane.

41 FUNDING PROGRAMS Surety Bonds SBA-backed surety bonds help small businesses succeed.

Eligible small businesses in the construction, supply, and service sectors better compete for contracting and subcontracting jobs using SBA-backed surety bonds.

How you benefit Surety bonds help small businesses receive the bonding assistance they need to win contracts by providing the customer with a guarantee the work will be completed.

How surety bonds work Many contracts require surety bonds, which are offered by surety companies. The SBA guarantee provides an incentive for surety companies to work with small businesses that would normally not be able to obtain the bond.

Is the program right for you? Small businesses that often come to the SBA for surety bonds: » startups and firms in business less than three years

» businesses with credit issues COURTESY OF AZTEC CONTRACTORS or internally prepared financial statements » those who cannot secure bonding HOW THE SBA HELPED ME SUCCEED With SBA-backed surety bonds, Frank Spencer III has been able to better compete for through regular commercial commercial and government contracts. Aztec Contractors of El Paso, TX received the channels bonding support it needed to compete for construction contracts with the General » subcontractors with a desire to Services Administration, U.S. Army Corps of Engineers, and the Mission and Installation establish their own bonding as a Contracting Command. Frank acquired Aztec in 2006 with no capital and only two prime contractor employees. Now he employs 25 full time and provides internship opportunities. Sales » those wishing to increase their have grown to about $30 million annually. Aztec now qualifies for bonding in the current bonding limits standard surety market without SBA support.

42 FUNDING PROGRAMS

For all contracts and subcontracts up to $6.5 million, the SBA guarantees bid, payment, performance, and ancillary bonds issued by surety companies. For federal contracts up to $10 million, the SBA makes a guarantee if it’s in the best interest of the government.

The SBA reimburses surety companies in case of default 90% of losses sustained for veteran & service- disabled veteran, minority, 8(a), and HUBZone-certified small businesses; all projects up to $100,000 and 80% for all other small businesses.

Need a surety bond guarantee fast? For contracts under $400,000, the process is streamlined using the SBA’s QuickApp program. » easy application » no need to submit financials to the SBA » online applications submitted to SBA authorized agents approved within hours

Ready to start? The SBA partners with 36 surety companies and hundreds of bonding agents. Find authorized agents at sba.gov/osg. Do you want to discuss the advantages of the SBA’s Surety Bond Guarantee program? Contact a bonding specialist:

Tamara E. Murray Kevin Valdes Jennifer C. Bledsoe Denver, CO Seattle, WA Washington, DC (303) 927-3479 (206) 553-7277 (202) 205-6153

43 CONTRACTING Doing Business with the Government

How I Did It COURTESY OF THE SBA Taking the Helm Jennifer Rahn steers Admiral Engineering and Manufacturing to success as a government subcontractor. written by Micaela Morrissette

44 CONTRACTING

Tips for CONTRACTING 5Success Find a mentor. I had a great mentor in my company, and I reached for opportunity when it was in front of me.

Always move forward. The SBA has educational resources to improve your business know-how. To learn more about government contracting and SBA certification programs, call your local SBA district office or procurement center representative.

Compete smart. See if your company can use the SBA Subcontracting Network database, https://eweb1.sba.gov/ subnet/client/dsp_Landing.cfm. SubNet connects businesses with subcontractors & small businesses with contract opportunities. COURTESY OF THE SBA

Know your industry. ennifer Rahn was first said, laughing. I see everything; I have my hands in hired as an office assistant One of their largest clients, aero- everything. I don’t want to expand to at Phoenix, Arizona-based space and defense company L3 where I can’t do that anymore. Admiral Engineering and Technologies, nominated Admiral Manufacturing Co. Rising for the SBA Subcontractor of the to the top in a sector dominated by Year award. As a subcontractor for L3 Build a team. Jmen, Rahn’s career sounds a lot like Technologies, Rahn said she gets great Everybody feels like this is our work the classic American success story. She satisfaction from knowing soldiers family. My employees are as big a part got there with the help of a mentor and are able to communicate with their of my company as I am, so I make business growth earned as a federal leaders because of parts her company sure they know that. government subcontractor. has made. For 16 years, Rahn worked side-by- When Schlosser decided to retire, he side with then-owner David Schlosser, asked Rahn to purchase Admiral. major government contractors. She’s who became her mentor. Rahn says she “He did not want to sell to a corpo- grateful prime contractors have incen- learned “everything it takes to run a ration that would bring in their own tive to subcontract with small business, machine shop. I naturally just picked it people or end up foreclosing,” Rahn and that helps businesses like Admiral. up and wanted it.” says. “Then all your hard work is gone. Rahn has plans to grow, but not in The learning curve was steep— I agreed because it was everything I had the typical ways. She’s investing in Admiral specializes in complex spent my life working on, too.” replacing equipment, enhancing effi- machined parts for industries including In September 2017, she took over as ciency and productivity while leading aerospace and communications—and owner and president. Ownership tran- Admiral into new arenas like 3D print- Schlosser expected as much as he gave. sition poses a unique set of challenges. ing. Because of the stability provided “When I did something wrong, he told Rahn wanted to maintain relationships by being a government subcontractor, me, and I didn’t do that again,” Rahn with her existing clients, which include she’s able to do all of this.

45 CONTRACTING

How to do business with the government 1 Identify your product or service number at naics.com.

Search the FedBizOpps database (fbo.gov) to see if any federal 2 agencies are looking for your product or service.

Attend an SBA district office workshop on contracting. Visit sba. 3 gov/localassistance to find your local office. Talk to a local Small Business Development Center counselor (see page 10) or visit a Procurement Technical Assistance Program 4 adviser. Find your closest center at aptac-us.org. 5 Obtain a free DUNS number at fedgov.dnb.com/webform.

Register with the System for Award Management 6 (sam.gov) to start doing business with the government. Are you eligible for SBA certification programs? Read more about the 8(a), woman-owned small business, and HUBZone programs. Find out if you are eligible and upload all required documents to 7 certify.sba.gov.

46 CONTRACTING

Government Contracting OPEN GovernmentIs it for you? Contracting Is it right for you? GovernmentGovernment contracting contracting can can bebe a avaluable valuable tool to tool grow to your grow small yourbusiness, small but it business,isn’t for but it isn't for everyone. Completeeveryone. the Complete following the following readiness readiness assessment assessment to to help help you decideyou decide whether whetheryour your company can successfully competecompany can for successfully government compete contracts.for government contracts.

Does the government buy the Are you capable of fulfilling Confirm your answer to all product or service that you sell? a government contract (e.g., of the following: time, staffing, and materials)? ∙ Is the majority owner(s) a U.S. citizen? ✓ Continue to question 2. ∙ Does your company have a place of ✓ Continue to question 3. business in the U.S.? ∙ Is your business organized for profit? x Government contracting may ∙ Does your business generate revenue? not be for you at this time. ? Your local SBA district office can help you gauge ramp-up time and Continue to question 4. Start with your local SBA district other factors that contribute to ✓ ? office. If you can't identify at least government contracting success. three federal agencies that might x These are requirements for buy what you sell, contracting might participation in government not be right for you. contracting programs.

Do you have cash on hand to Do you have an accounting Are you credit worthy? purchase working invento- system that produces financial ry, if needed? statements, such as profit and ✓ Continue to question 5. loss statements, balance sheets, ✓ Continue to question 7. and cash flow projections? x Visit an SBA Resource Partner for tips on repairing your credit. Talk to an SBA Lender about ✓ Continue to question 6. x getting a line of credit or a loan to Talk to an SBA Lender do business with the government. ? Before you get into government about how to build credit. x contracting, make sure your accounting system is compatible with the government’s requirements.

Do you already have Do you know where to find Make sure you have: federal/state/local government contracting opportunities? ∙ a DUNS number contracting experience? ∙ the NAICS codes and size standards Continue to question 9. for your industry ✓ ∙ SAM registration ✓ Continue to question 8. x Ask an SBA business opportunity ✓ Continue below. If you don't yet have contracting specialist for help. x experience, you won't reap the full benefit of opportunities like the x This is a requirement for 8(a) Business Development Program. participation in some government You can participate in the 8(a) contracting programs. program once, so make sure it's the right time for you.

It sounds like you may be a good fit for government contracting! Visit your local SBA district office or sba.gov/contracting for more information. 47 CONTRACTING SBA Certification Programs Your business could earn profit and gain valuable work experience by providing goods or services to the government.

Socially disadvantaged: those subjected HOW THE SBA HELPED to racial or ethnic prejudice or cultural bias ME SUCCEED without regard to their individual qualities September Myres knew that becoming a because of their identity as members government contractor would empower herself of certain groups. The following groups and other native peoples, while also growing often fit this status: Black Americans, her small business to the next level. She sought Native Americans, Alaska Natives, Native business development assistance from the SBA, Hawaiians, Hispanic Americans, Asian qualifying for the SBA 8(a) Business Development Pacific Americans, and Subcontinent Asian Program, which helps small disadvantaged Americans. A person who is not a member businesses compete in the federal marketplace. of one of these groups must establish that This program helped September strategically it is more likely than not that he or she has grow her company to become a competitive force suffered social disadvantage. in the environmental services industry. Sundance Economically disadvantaged: those whose Consulting of Pocatello, ID has won contracts ability to compete in the marketplace has from the Army Corps of Engineers and the U.S. been impaired because they have not had Forest Service. She has continually secured as much capital and credit opportunities Department of Defense contracts to improve compared to others in the same or similar Native American lands adversely affected by past line of business. department activities. September often assists The benefits of the 8(a) program: Native American tribes and Alaska Native villages with developing projects and community plans. » You are assigned an SBA professional to American Indians, Alaska Natives, and native help coordinate business development Hawaiians seeking entreprenurial development assistance. training can start, grow, and expand their » You could be awarded an 8(a) sole-source business with the help of the SBA, sba.gov/ contract up to $4 million for goods and naa. The Office of Native American Affairs services, $7 million for manufacturing, also consults with tribal governments prior to

COURTESY OF THE SUNDANCE CONSULTING SUNDANCE THE OF COURTESY exceptions apply. finalizing SBA policies affecting tribes. 8(a) small business that can provide the needed services. This is an accelerated process saving time for both you and the Contracting certification programs are education, training workshops, and government agency or office. designed to help you better compete match-making opportunities with federal for and win federal contracts set aside buyers. Firms owned by Alaska Native All Small Mentor-Protege for small businesses. Visit sba.gov/ Corporations, Indian tribes, Native Program contracting to learn more about set- Hawaiian organizations, and Community Looking for an opportunity to partner with asides and whether one or more of these Development Corporations are also a more experienced firm for mentorship? government certification programs is right eligible for 8(a) business development That effort can be rewarded in the All for your business. To see if you are eligible assistance. Small Mentor-Protege Program, sba.gov/ and then certify as a woman-owned, To be eligible for the 8(a) program, your allsmallmpp. At the same time you’re gaining HUBZone, 8(a), or All Small business, visit small business must: invaluable direction and experience, you and certify.sba.gov. » be owned and controlled by U.S. citizens your mentor can compete for government who are socially and/or economically contracts, further growing your business. 8(a) Business To qualify for this program: Development Program disadvantaged If you’re an entrepreneur who is socially » demonstrate at least a two-year track » Proteges must have a mentor prior to or economically disadvantaged, you record and have potential for continued applying for the program. Visit your local may be eligible to receive business success SBA office for guidance. Ask about the SBA’s Resource Partners and the Procurement training and government contracting » have a net worth and adjusted gross Technical Assistance Program for help in assistance through the 8(a) Business income of less than $250,000 and assets connecting you with a mentor business. Development Program, sba.gov/8a. under $4 million It includes free business development 48 CONTRACTING

» You must be certified as a small business within your NAICS industry classification (naics.com). Women-Owned Small Business » Mentors and proteges must be organized for profit or as an agricultural Certification cooperative. If you're a woman proprietor looking to sell to the federal » Mentors cannot own more than 40% government, you may be eligible for the Women-Owned Small equity in the protege’s business. Business certification, sba.gov/wosb. » An SBA determination of affiliation must not exist between the mentor and the Here’s how to get certified: protege. All Small-approved partnerships receive an exclusion of affiliation for contracting purposes. 1. Make sure you’re eligible

HUBZone • Your business must be at least 51 percent owned and controlled by one or more Businesses located in Historically women who are U.S. citizens. The ownership must be direct and unconditional. Underutilized Business Zones, sba.gov/ • A woman must hold the highest officer position and have managerial experience hubzone, can gain special access to federal required to run the business. contracts. To qualify for the certification, your small business must: • One or more women must manage the daily business operations on a full-time basis and conduct long-term decision making and planning. » be owned and controlled by U.S. citizens, a Community Development Corporation, To qualify as an economically disadvantaged woman-owned small business, your an agricultural cooperative, Indian tribal company must meet these criteria and the business owner and/or manager must government, Alaska Native Corporation, meet certain income and asset requirements. or a Native Hawaiian organization » have a principal office located in a HUBZone, which includes Indian reservations and military facilities closed 2. Register by the Base Realignment and Closure Act. Enter your address in our interactive map, • Register with the System for Award Management (sam.gov) to start doing busi- maps.certify.sba.gov/hubzone/map, to ness with the government. see if you qualify. » have at least 35% of your employees 3. Certify living in a HUBZone Service-Disabled Self-certify as a woman-owned small business or an economically disadvantaged Veterans woman-owned small business for free, or obtain certification from one of the SBA’s If you’re a service-disabled approved third-party certifiers (which costs a fee): veteran looking to enter the federal • El Paso Hispanic Chamber of Commerce marketplace, you may be eligible for this • National Women Business Owners Corporation small business certification. To determine your eligibility, contact a veterans business • U.S. Women’s Chamber of Commerce development officer at your local SBA • Women’s Business Enterprise National Council office, or the SBA’s Office of Veterans Business Development, sba.gov/ovbd. All required documents must be uploaded to certify.sba.gov prior to submitting After you have set up to do business with an offer on a contract set aside for the program. the government in sam.gov, update your status as a service-disabled veteran business. Keep in mind, the SBA does not 4. Update your status officially certify this designation, so when a contract awarded based on this eligibility • Update your status as a woman-owned small business in sam.gov. is protested, the SBA will determine if your business meets the eligibility status, ownership, and control requirements. 5. Search the database

• Search the FedBizOpps database (fbo.gov) for your new business opportunity.

49 CONTRACTING

An O’Fallon Casting Inc. employee at work in O’Fallon, MO. Owner Vince Gimeno grew his business thanks to expert SBA business counseling. Get Expert Contracting & Certification Help Federal contracting can be complex, but you don’t have to do it alone. A Procurement Technical Assistance Center adviser can help you determine if your business is ready for government contracting. An adviser can also help you register in the System for Award Management (sam. gov), and see if you’re eligible for any small business certifications and/or programs. One-on-one counseling is free or low cost. Visit sba.gov/ localassistance to find your local SBA office or an SBA Resource Partner near you (see page 10).

By the Numbers The U.S. government is the largest single purchaser of goods and services in the world. Every year it awards more than $500 billion in contracts. Of those prime contracts, the federal government must set aside 23 percent for small businesses. This includes: • 5 percent for small disadvantaged businesses • 5 percent for women-owned small businesses • 3 percent for HUBZone- certified small businesses • 3 percent for service-disabled veteran-owned small businesses COURTESY OF THE SBA

50 51 52