Small Business

The Congressional Committee on Small Business showed its support for small businesses  in the cannabis industry in two instances this weekLetter to the Small Business AdministrationAt the federal level, marijuana remains illegal. However, it can be purchased with a medical prescription in 33 states, and adults can obtain it for recreational purposes in 10 states and in District Colombia. With the marijuana industry and the tax revenue it generates quickly growing in recent years, lawmakers have increased their efforts to provide basic financial resources to businesses in the niche.We saw an example of said efforts on Wednesday. The Small Business Committee addressed the federal Small Business Administration (SBA) in a letter that voiced their concerns about SBA’s existing policies.  Currently, rules that prevent operators from the pot industry and those indirectly involved with it from gaining access to funding and other SBA resources are in place. Aware of the negative impact such rules have on small businesses across the country, seven congressmen and women signed the letter sent to the SBA on June 11.“Under this  Policy, small businesses in states with legal marijuana are effectively forced into making the unfair choice between being able to access SBA-backed lending or conducting business with a large and growing sector of local economies in states with legal marijuana,” they wrote.The Committee proposed it should work together with the SBA on “minimizing burdens and maximizing access to capital for small businesses looking to engage in this emerging industry.''Scheduled HearingThe House Committee on Small Business scheduled a hearing to discuss the opportunities for entrepreneurs and small businesses arising from the flourishing pot industry and the challenges they face.The Congressional Committee announced a hearing titled “Unlocked Potential? Small Businesses in the Cannabis Industry” yesterday in a notice on its official website. The hearing will be held on June 19, at the Rayburn House Office Building in Washington D.C.At next week’s hearing, the Committee Members will have an opportunity to examine the challenges small businesses in the marijuana industry currently face. The obstacles of “indirect” cannabis businesses - the ones that are not directly involved in the production or distribution of pot products - will be discussed too. A live stream of the hearing will be available on the Committee’s website.

By Ivana V. June 13,2019

The rates of suicide, drug and alcohol-related deaths are the highest they’ve been since records began. The Commonwealth Fund report released on Wednesday raises concerns over U.S. citizens’ mental health. The report covered all 50 states and Washington, D.C. The researchers performed complex, multi-factor analyses in their search for the cause of these alarming death rates. As many as 47 different factors were analyzed over a five-year period, some of which included the growing burden of working families, insurance coverage, obesity, and even smoking. The biggest problem, however, turned out to be the rising cost of healthcare and poor healthcare coverage.The newest data on these aptly named “deaths of despair” casts a shadow on the citizens’ right to the pursuit of happiness. The number of people who are able to afford proper medical care continues to drop, even among the employed. In the 2019 Silicon Valley Bank U.S. Startup Outlook report, startup owners cited healthcare costs as the second most troubling public policy concern, at 44%. As data from the Commonwealth Fund report indicates, business owners’ inability to afford health insurance for either themselves or their employees can have grave consequences on large groups of people, even entire communities. Still, even though the average rates are troubling, rising suicide rates and the opioid crisis show striking regional disparities. The ongoing opioid crisis has hit a number of states in The Southeast, the Mid-Atlantic region and, New England hard. In West Virginia, the drug OD death rates amounted to more than double the national average in 2017. That’s 57.8 deaths per 100,000 residents. Ohio was the follow up with 46.3 drug-related deaths per 100,000 residents. The next highest drug OD death rates were noticed in the District of Columbia, Kentucky, Delaware, and New Hampshire. As for suicide and alcohol-related deaths, Wyoming, Nebraska, Oregon, Montana, and the Dakotas had the highest death rates. On the bright side, Hawaii, Massachusetts, Minnesota, Washington, Connecticut, and Vermont ranked the highest in health rankings. Arkansas, Nevada, Texas, Oklahoma, and Mississippi showed the lowest health rankings in all 50 states. The most telling difference between said states, according to the CF report, was the way they handle health care and coverage. The inability to afford proper psychiatric assistance, time in a rehab center, or even healthcare coverage in broader terms results in significantly higher suicide rates and opioid-related deaths.All five of the 17 states that did not offer access to Medicaid through the Affordable Care Act had the highest rates of uninsured adults.The most common reasons Americans cite as the leading cause of stress is healthcare (43%)  and the economy, at (35%) according to the 2017 Stress of America, the State of Our Nation report. Around 28% of U.S. adults claimed that high taxes were the highest source of stress, followed by unemployment and low wages at 22%.With healthcare costs going up, Medicaid has become a necessity for many U.S. citizens. At 4%, Massachusetts, which expanded access to Medicaid, had the lowest rate of uninsured adults while Texas, which declined to do so, had the highest rate of 24%. The National Center for Health Statistics found that 12.7% of the U.S. population over the age of 12 took antidepressants. Given the significant regional differences in all deaths of despair, any incentives and efforts to combat the epidemic ought to be tailored to local circumstances, the Commonwealth Fund report authors concluded. If you or someone you know is in crisis, call the National Suicide Prevention Lifeline at 800-273-8255, text HOME to 741741 or visit SpeakingOfSuicide.com/resources for additional resources.

By Andrea June 13,2019

Steal from the poor and give to the rich—it would seem there’s no more honor, even among criminals. A fraud ring, led by Demetrios “Jimmy” Boudourakis from Farmingdale, NY recently targeted 35 small-business owners, not only within Long Island but also reaching as far as California and Florida. He stole more than $2 million through a widespread loan scheme. This Long Islander managed to find the names of small business owners who were rejected for loans using the dark web, and then cold-called them, claiming their loans could be approved if they paid fees and interest up front. This classic boiler room plot was successful in many instances—one victim alone was scammed out of more than $150,000. Boudrakis and his associates got cashier checks or wire transfers, and would then make excuses to the victims about why the money wasn’t coming. In other instances, they would simply refuse to answer calls.Boudrakis was charged with grand larceny, money laundering, and other crimes, and has pleaded not guilty at the arraignment in Central Islip, on Wednesday. According to the records, Suffolk County District Judge Gaetan B. Lozito set the bail at $1 million in bonds or $500,000 cash. The Suffolk DA, Timothy Sini, claims that the fraud began somewhere in 2016 in an office in Melville, NY, and then moved to Seaford, NY. Appropriately enough, the building where the office was located had a huge poster of a “Wolf of Wall Street” hung up on it.  It took over a year and the joint efforts of Nassau Police, Suffolk Police, New York State Police, FBI, and the Drug Enforcement Administration to investigate the scheme and build a strong enough case to catch the criminals and break the fraud ring. Along with Boudrakis, there were several other associates: Johnson Joseph of Brentwood, NY, charged with grand larceny, money laundering, and a scheme to defraud, Nadim Afzali of Hicksville, NY, charged with a scheme to defraud, Christopher Looney of Bethpage, NY, charged with grand larceny and a scheme to defraud, Tanya Balbi of Farmingdale, NY, charged with a scheme to defraud, Johnson Joseph of Brentwood, NY, charged with grand larceny, money laundering, and a scheme to defraud, and finally, Jude Brun of Elmont, NY charged with a scheme to defraud. They have all pleaded not guilty. Michelle Soccodato of Hicksville, NY, has yet to appear on an arraignment. She has also been charged with a scheme to defraud. These kinds of schemes are incredibly dangerous because they target the weak and the vulnerable. Any small business owners who believe they were a victim of Boudrakis’s scheme should contact the DA’s office for help.

By Julija A. June 13,2019

U.S. Small Business Administration’s Microlender of the Year Award presented to the Arizona-based non-profit organization called PPEP Microbusiness & Housing Corporation.Dr. John Arnold founded the organization in 1967 with the aim of helping struggling farmers in rural Arizona get the financial assistance they needed. Ever since then, the nonprofit has been focused on providing loans to the state’s agrarian community, covering 67% of the state, Arnold said to Tucson Local Media.Microlenders are organizations that offer small-balance loans to low-income groups or individuals. The Small Business Administration (SBA) considered microlenders as essential to the success of small businesses in rural areas. And PPEP Microbusiness & Housing Corporation is one of the two microlenders Arizona small entrepreneurs and low-income families rely on.The award ceremony was held on June 6 at the organization’s headquarters in Tucson. Craig Jordan, who presented the award on behalf of the SBA, used the opportunity to praise PPEP for its efforts in helping the community by providing small loans as well as technical assistance. He underscored the importance of the nonprofit’s decades-long efforts to support small businesses in the area.“Every award that we’ve received, we don’t take lightly,” Arnold said at the ceremony. “And it also gives us an opportunity for us to present recognition to our board, to our loan review committee, finance staff, and those that do the loans out in the field.”After the award ceremony, the organization welcomed its new Executive Director  Yasmin Badri. Prior to joining the Tucson nonprofit microlender organization, she worked as a consultant with the World Bank and the IMF in Washington, D.C. Born in Germany to parents of African descent, Badri also worked for the United Nations and UNICEF in Sudan as a media consultant. Before undertaking her new role in PPEP in May 2019, she had founded her own microlender service.She too expressed her appreciation for the award, acknowledging the colleagues who have been in the organization longer than her. “It means a lot for us. This is an effort that’s been done by the staff members and our whole team. I am new and won’t take credit for it. But I am so proud to be here and to be a part of this team effort and this accomplishment.”In her speech, Badri emphasized her commitment to continuing the great work of those before her and the goal of expanding the organization’s reach in order to help even more underserved borrowers.

By Ivana V. June 13,2019

According to the 2019 Center for the Urban Future report, since 2008, Brooklyn’s tech start-up growth rate has been second only to that of San Francisco, home of the Silicon Valley.Their 356% growth rate exceeded that of New York City (308%), Philadelphia (290%), Los Angeles (279%), and Chicago (270%). Brooklyn also outperformed the remaining 16 major tech hubs in the US.While researching and producing the 2019 report, the CUF also collaborated with  Downtown Brooklyn Partnership, Brooklyn Navy Yard Development Corporation, Industry City, and Dumbo Improvement District. Their detailed data analysis comes from Churnbase—a global tech-startup-tracking database operating with a mix of public, private, and self-reported sources. Since 2008’s startup score of 264, Brooklyn has come a long way, with 1,205 tech-enabled start-ups operating in 2018. The Center for Urban Future found that the Brooklyn startup count amounts to more than that of Queens, Manhattan, Staten Island, and the Bronx put together.  The proliferation of tech startups resulted in a rise in tech sector employment by 175% from 2007 to 2017. That’s double the 86% growth in Manhattan, and then some. The CUF analysis identified three core areas that have brought Brooklyn the spectacular growth in the innovation economy: creative companies, tech startups, and finally, next-generation makers and manufacturers.Startups in industries such as media and entertainment (249 start-ups), commerce and shopping (174), financial services (102), and data and analytics (81) have been growing at a breakneck speed. The innovation economy has also seen a noteworthy concentration of creativity and tech startups, including artificial intelligence (23 start-ups), blockchain (14), and virtual reality (8). Brooklyn tech startups have also ventured into fusing traditional manufacturing processes with innovative design and technology. Many tech startups are operating in areas closely related to manufacturing, including hardware (102 startups), food and beverage (53), consumer electronics (44), consumer goods (41), and others. Still, all this skyrocketing tech success in Brooklyn has come at a price. The new report shows a significant drop in more traditional manufacturing jobs, although an increase in net job gains in areas such as electrical equipment and jewelry manufacturing has been observed. As Brooklyn has evolved into an oasis of groundbreaking opportunities in tech and tech-fused industries, the locals have faced the resulting gentrification problems and an exponential increase in housing prices, further exacerbating the issue of housing affordability. Overall, the new report’s analysis of Brooklyn’s tech sector supports the claims of Brooklyn’s growing advantage over Manhattan, second only to San Francisco, the heart of the Silicon Valley.

By Andrea June 13,2019

It looks like small businesses are ready to go full steam ahead this quarter. The MetLife and US Chamber of Commerce published the Q2 Small Business Index, which shows an increase of 3.1 points—a strong rebound after the drop in the first quarter of 2019. The current index score is 68.7. Small business owners are experiencing a boost in confidence that can be attributed to the overall positive perception of the nation’s economy. With improved cash flow nationwide, a lot of companies are getting back on their feet, eager to face new challenges. The drop since the last quarter can at least partially be attributed to the longest government shutdown in American history. Small businesses are finally recovering from the financial blow, and this 3.1 point increase is the most significant quarter-to-quarter increase since the Index came into existence. The results were taken from a survey of 1,000 companies, and they show an upward confidence trend across nearly all demographics. 58% of female business owners have expressed feeling optimistic about the future, almost matching the 59% of male owners who feel the same. Statistics also indicate an increase in hiring new employees. Millennials and Gen-Xers seem to be taking the lead here—39% of small business hiring plans nationwide are attributed to these demographics, even though they represent only 27% of survey respondents. The Index also examined how small businesses handle health insurance. As many as 69% of small business owners claim selecting a health insurance plan is time-consuming, difficult, and that there isn’t enough information about it. On a related note, 1 in 5 respondents claim that they are unable to make informed decisions and choose the best coverage for their needs. Out of those surveyed, 32% of small business owners turn to brokers, agents, and consultants for advice on health insurance, 9% rely on online research, and 7% seek advice from other owners. Other sources include HealthCare.gov, health insurance company sites, and Professional Employer Organizations. Finally, 7% of respondents stated that they don’t know where to turn for more information. So, what are the owners looking for when choosing health care plans for their employees? Research shows that 20% of small business owners are concerned with keeping monthly premiums low, 20% prioritize minimizing out-of-pocket costs such as deductibles and copays. In contrast to that, 9% seek flexibility and variety when making a choice, and 7% demand access to quality hospitals and treatments. Aside from the puzzling complexity of healthcare coverage plans, businesses are confident about their future. Despite economic hardships in the last quarter, the outlook remains positive, and owners are willing to invest in their companies and strive towards success.

By Julija A. June 13,2019

Canadian small business owners now have a strong incentive to boost their cross-border sales. PayPal has recently partnered with netParcel, a Toronto-based tech company offering access to substantial shipping rate discounts. The new discount solution can save up to 75% on shipping costs, not only outside of Canada but within Canada as well.As a result of this partnership, over 250,000 businesses that use PayPal can now enjoy aggressive shipping discounts, whether they are shipping parcels within Canada or internationally. Additional features include a one-day shipping service to the US and tracking links on every parcel. An integrated platform allowing sellers to meet all their shipping needs is also available. Sellers importing from eBay, Shopify, Etsy or WooCommerce can now choose the fastest and cheapest way to send their parcels in one place. The shipping rate comparison option allows users to select the best carrier and service. PayPal’s Seller Protection is available on all eligible shipments, and it enables users to schedule free parcel pick-ups.The lack of efficient shipping options and high shipping costs has been holding Canadian sellers back for years. Despite the 14 trade agreements with countries all over the globe, only 12% of SMBs were able to trade internationally on a substantial scale.The one-day shipping service to the US is particularly important. The US is one of the most profitable export markets, offering some of the most significant international growth opportunities. The mutual support between these countries allowed goods valued up to $800 to be sent free of tax, brokerage fees, and duties.Offering link tracking for every parcel relieves one of the biggest buyer anxieties - whether or not the product will even reach them. Now, they can keep a close eye on the shipping process every step of the way. Finally, unlike most other subscription-based shipping solutions, this shipping tool comes with no extra charge.One of the beneficiaries of the new shipping discounts agreed to share his take on PayPal’s latest shipping solution. Michael E., the owner of HockeyAuthentic.com, has been selling licensed NHL jerseys for decades. He estimates that the new shipping option is saving him $1000 per month. He cites high shipping costs as one of the biggest setbacks to his business, as most customers expect free shipping. According to Michael, the new rates are the best he’s seen in his 28 years of doing business. Michael also said his hockey-loving customers are happy with the one-day US shipping option. "Thousands of times we've next-day delivered a hockey jersey to a fan in the U.S. or Canada going to a game that night. This absolutely blows away our customers with that kind of delivery speed," he said. Pampering fans and customers is never a bad idea, and the strategic netParcel partnership can help introduce Canadian SMBs to a world of new opportunities at breakneck speed.

By Andrea June 12,2019

In a surprising turn of events, the small fish have come out to defend the big sharks. After the House Judiciary Committee’s inaugural hearing on Tuesday afternoon, small businesses are more scared than ever about the fate of Facebook, Amazon, Apple, and Google. The business practices of these tech giants are currently being dissected as Washington’s fear over their influence on public life and the American economy rises, but the small players are opposed to the investigation. Members of a small business advocacy group called Connected Commerce Council (3C) expressed their concerns and urged the Judiciary Subcommittee on Antitrust, Commercial, and Administrative Law to take into consideration the importance of these companies for small businesses. The House Judiciary subcommittee has been investigating mega-corporations to find out whether their market dominance has suppressed competition unfairly. While harming smaller firms seemed like the most likely outcome, it would appear that these tech giants are actually supporting them using an array of invaluable tools and services. The palette of useful tools these large companies provide at low prices is crucial to startups, entrepreneurs, and small firms who use them for marketing their own products. 3C’s also provided the committee with the results of a recent economic report put together in partnership with Deloitte, which states that American small businesses greatly benefit from having access to digital tools provided by the tech giants. “This market is interconnected and big companies power growing companies to compete and win," C3 president Jake Ward said in a press release. Congressional reach into the private sector could potentially be detrimental if it affects the ability of smaller firms to conduct their businesses safely and successfully. House Democratic Chairman Hakeem Jeffries claims that people from both sides of the aisle should have the chance to speak and that we should hear from the CEOs of big tech companies regarding the concerns being raised. The investigation is largely backed by the Democratic leadership, and it represents the first congressional probe into the antitrust allegations. House Speaker Nancy Pelosi claims that “the era of self-regulation is over.” Surprisingly, the Republican party is also criticizing the reach of big tech companies. One of the biggest government concerns is related to the way companies such as Facebook and Google influence the news media. Both Democratic and Republican representatives have agreed to co-sponsor legislation that would allow local news organizations to unite and negotiate with the tech giants when it comes to issues such as news quality and access.   This is one of the biggest bipartisan issues that affects both Democrats and Republicans. While the conservatives don’t enjoy overregulation, they have concerns about the monopolization of the market. What the final outcome will be remains to be seen, but for now, small businesses are rooting for the big guys.  

By Julija A. June 12,2019

Leveraging decades of experience in enterprise networking, Aruba has introduced Instant On, a safe and feature-rich WiFi solution for smaller organizations.Aruba Networks is a Santa Clara, California-based wireless networking company, founded in February 2002. Currently, it’s a subsidiary of Hewlett Packard Enterprise that’s ranked No. 107 in the 2018 Fortune 500 list of the largest United States corporations by revenue.To deliver these cutting-edge results in the WiFi market, Aruba is leveraging decades of enterprise networking, and a partnership with Synnex, winner of Distributor of the Year in the US and Canada at 2019 the Aruba Americas Partner Summit. Specifically built for small organizations and businesses, the new Aruba Instant On WiFi solution promises to deliver a unique synergy of secure, and high-speed WiFi. Hyper-competitive and ambitious small businesses understand that they cannot lead the way in their industry without a reliable and fast WiFi connection. This is especially true of successful businesses struggling to keep up with overwhelming expansion. Aruba’s Instant On solution is flexible enough to accommodate for growth and changes in the future.The Instant On family of solutions will deliver indoor/outdoor WiFi access points. It will be an easily deployable wireless solution that even non-tech-savvy folks can manage remotely from any mobile device. Still, this simple, speedy, and connected solution might be cause for some concern — after all, 43% of cyber crimes target small businesses, according to data compiled by SCORE. Consequences can be severe as 60% of targeted companies go out of business within the first couple of months of being hacked. Most SMBs have a relatively small client base, so a tarnished reputation can prove detrimental. Joining together top-notch security and speedy, quality WiFi is, therefore, a particularly ambitious goal Aruba has accomplished. The overall necessity of an internet connection for any employee to complete daily tasks in today’s economic landscape has forced small businesses to rethink their networking requirements. SMBs must align with the latest technology shifts and trends with relatively limited resources. Aruba’s easy-to-use, intuitive mobile app offers simple and secure set-up and management services. Two management modes are available on its Instant On mobile app or cloud-based web portal. This is matched by top-of-the-line security capabilities, including compliance with the latest authentication protocols such as WPA2/WPA3. Instant On combines Aruba’s industry-leading 802.11ac Wave 2 technology with a WiFi solution built specifically for small businesses. It also provides unique flexibility to scale up as a business’s needs change.The shipping of the first set of Aruba Instant On APs will begin in July, with the price starting at $119.

By Andrea June 12,2019

H&R Block Inc. will spend $405 million on acquiring Canadian financial software company called Wave Financial Inc. The decision was announced by H&R Block on Tuesday, June 11. The Kansas-based company expects to close the deal in the next few months, pending regulatory approval. The news was made public the same day H&R Block published its latest quarterly and annual financial reports. The American tax preparation firm, in business since 1955, has been looking for ways to accelerate their small business strategy. The company President and CEO, Jeff Jones said in a press release on Tuesday that he feels Wave Financial would enrich the H&R Block’s offer by bringing it closer to small businesses. Wave Financial provides accounting, invoicing, bookkeeping, payroll, and payment processing services to more than 400,000 small businesses worldwide. Jones explains that bookkeeping and cash-flow management have proven to be major weak points for small business owners, yet they are crucial to successfully preparing annual taxes. “We spend a lot of time with our clients and listening to our clients and when you do that you learn a lot about their unmet needs,” Jones said. “And that leads us to think about product development, innovation and ways we can serve more clients.” H&R Block hopes to meet users’ needs for financial solutions by offering a simple user experience on a single platform through partnering up with Wave Financial. Upon the acquisition, Wave Financial will keep its leadership team, headed by the company co-founder and CEO Kirk Simpson. The company will continue to operate from its Toronto headquarters. “Given the complementary strengths of these two great companies and our shared vision of providing financial help to people who need it, we’re delighted to be joining the H&R Block team,” Simpson said in the release. “We are excited to work together to deliver additional value to small businesses to help them succeed.” Wave Financial is anticipated to generate between $40 and $45 million in revenue for the 2020 fiscal year. Apple Supplier AMS Reports a Positive Outlook for Q3 Driving Europen Chip Stocks Up Back in 2014, H&R Block launched its own software geared toward small businesses. The software provided bookkeeping, tax, payroll, and coaching services to this target group until 2016 when the company made the decision to take it off the market. H&R Block Financial Report The Financial statement published on June 11 reveals that in fiscal 2019 the company made $3.1 billion in revenue. In the same fiscal year, 20.3 million US tax returns were prepared by or through H&R Block.

By Ivana V. June 12,2019

Small business owners in Utah have something to look forward to—the opening of Utah Small Business Development Center Network’s Global Trade Center. Salt Lake Community College's Miller Business Resource Center announced the news on Monday, claiming that the new trade center will offer resources and education for small business owners and entrepreneurs. It will work in collaboration with the old SLCC Global Business Center that was established in 2007. Jim Herrin, the Salt Lake region director of the Utah Small Business Development Center, explained that their aim is to have more businesses find out about the global trade, and establish international training programs. The Utah network is funded by the state of Utah, the agency, and local colleges and universities, Herrin claims, and the program is hiring experts focused exclusively on helping small businesses run smoothly. They will offer person-to-person assistance across all industries and help both established companies and entrepreneurs looking to get started. This can provide an incentive that will help them grow and become more successful. Small businesses are the backbone of the American economy. While only 1% of them export goods, those companies are responsible for one-third of total US global exports, according to the Department of Commerce. Utah alone exported $11.6 billion in goods in 2017, and small businesses accounted for 49% of that share. It can be difficult for small firms to find the capital to fulfill foreign purchase orders, and it’s even more difficult for them to connect to overseas buyers. That’s why these educational programs are so essential in promoting a healthy economy. US products are considered premium in many countries, so it can sometimes be easier for small businesses to establish themselves in foreign markets than at home. There is less competition, and with the right kind of training, a company can start thriving in a fairly short amount of time. This kind of success can also attract foreign investors and bring in even more profits that help the local market and increase the standard of living for everybody. Through international trade, Utah’s economy can continue to evolve and create more jobs and opportunities for its citizens. The new global trade center can help to identify international trade opportunities and, what’s more, teach business owners how to respond and make the best of them. It can also give access to grants and provide the needed capital to get in contact with foreign buyers. With this new network of connections and resources, Utah’s small businesses can enjoy a new era of growth and prosperity.

By Ivana V. June 11,2019