My comment on change in definition of "small business" by SBA.

“Comments can be submitted on this proposed rule on or before July 18, 2014, at http://www.regulations.gov, identified by the following RIN number: (RIN 3245-AG49).  You may also mail comments to Khem R. Sharma, Chief, Office of Size Standards, 409 3rd St., SW, Mail Code 6530, Washington, DC  20416.”

Monday, May 19, 2014

I’ve done startup workshops in Denver, Colorado for some 20 years as an alternative to the SBA venture capital model of formal market research and formal strategic planning. What I’ve been doing for decades was viewed by most as eccentric when I started in 1994, it is becoming more accepted recently with publications advocating along similar lines, back in ’94 the only theoretical underpinning was from Dr. Amar Bhide the professor of entrepreneurship at Harvard University who’d sent his students to interview successful startups, articles in the Harvard Business Review soon became his very fine, but virtually ignored, book The Origin and Evolution of New Businesses, Oxford University Press. www.bhide.net

The Wall Street Journal had a column a few days ago pointing out that most of what is now being taught on college campuses about startup is not helping. The more talk about startup, the fewer startups, virtually all talk is what I would call propaganda at the encouragement of the SBA and it’s many off-shoots, SCORE, SBDCs, etc, and it is killing small business in America.

One part of the problem is how the SBA defines small business, right now any business with up to 500 employees with certain exceptions. Yes, this definition needs to be changed, but not in the direction the SBA suggests, to 1,500 employees for some businesses. The definition by number of employees needs to be revised down, I suggest to 300.

Why 300? Because that’s what E.F.Schumacher’s experience led him to back in the late 60’s in his very good book Small is Beautiful—Economics as if People Mattered. More than 300 employees and the nature of the interactions between the people starts drastically changing.

I’ve started a virtual “chamber of commerce” with the intention of helping local chambers provide more real help to startups, as an alternative to the very expensive and ineffective SBDC program. Businesses with 10 to 100 employees, the bedrock of American business, is in sharp decline. Why? Because the SBA is killing startups. It’s a tax funded enterprise clearly intending to snuff out the entrepreneurial spirit in America.

But I don’t want to misrepresent my statement here, it is my own and not that of any organization. The Small Business Chamber of Commerce, Inc. does not lobby at this time, and I do not expect that it ever will.

 I say I’m a recovering MBA because much of what I was taught in graduate business school I’ve had to overcome to be of real help to people who are starting their own business. Since 1994 I’ve worked with thousands of people and what I’m saying here is based on that experience. I read a lot, but in no way am I an academic.  That does not mean there is not academic support for what I’m saying here to you now.

Nobel prize winning economist Edmund Phelps points out the very real problem of the sharp falloff in vitalism and dynamism in our culture since the late 60s, I recommend his most recent book to your committee before you make a decision on this, it’s called Mass Flourishing.  Also the recent Harvard Business Review Press book Just Start.

My little book, endorsed by Dr Amar Bhide, has been on sale for the last 20 years, as far as I know it has never done any harm and a lot of people have told me it has helped them. The Kindle version is 99-cents, and I’d suggest the committee buy it and make copies for all committee members, you have my permission to do so. Go to Amazon.com and search on “John Wren, Daring Mighty Things.”

Thank you for your consideration. I’d be glad to answer any questions you might have.

John S. Wren, MBA+++ (Cornell College, University of Denver, BA’69, MBA’80, Regis University)

www.JohnWren.com

1881 Buchtel Blvd, #501

Denver, CO 80210

(303)861-1447  cell (720)495-4949