The JOBS Act, which President Barack Obama signed into law last week, will make it easier for area entrepreneurs to get money to support their business ventures.
“The whole point is to bring the ability to have that working capital to those high-growth industries that can turn around and put that good or service into the marketplace and create jobs,” Walter Perry, district director with the U.S. Small Business Administration, said.
Examples of high-growth industries include solar, hydroponics and other green industries, SBA leaders said.
The main part of the new law will phase in regulations over a five-year period to let small companies go public sooner, according to The Associated Press.
It also combines several bipartisan bills that exempt newer companies from Securities and Exchange Commission reporting rules in an effort to reduce costs and “red tape,” according to the AP.
Another piece of the bill allows for “crowd-funding,” which allows a large group of small investors to support businesses via the Internet.
Last year when representatives from the Small Business Administration toured the country and talked to entrepreneurs, many said their main concern was creating jobs, but to do that, they need access to funding.
For startup companies, it’s often hard to get funds, especially in the early stages of development.
In recent years, lending has tightened for small business owners.
And for some emerging businesses with new technology, there isn’t a track record of success. That doesn’t mean the business won’t be a success, but it makes it more difficult to get funding, Perry said.
The JOBS Act is another tool that helps correct that problem, leaders said.
“Smaller companies, if they have access to that capital at the earlier stages when they are starting that growth, it gives them the chance to grow quicker,” Perry said.
Sharyn Moreland, director of the Tennessee Small Business Development Center, which provides resources for business owners, said that her organization hired two people to help implement the JOBS Act.
The new employees focus on existing businesses, job creation, job retention and economic development.