In January 2018, 1871 was selected by the Kauffman Foundation as one of six entrepreneurial support organizations nationwide to serve as a policy advocate for entrepreneurs. In partnership with the Kauffman Foundation, 1871 is using the grant to fund a three-year program that will convene entrepreneurs, investors, and policymakers in one room to address the issues that are impacting entrepreneurs the most. The program features two policy forums a year to discuss the most relevant challenges facing entrepreneurs. Together, the objective is to find policy-driven solutions and amplify entrepreneurs’ and investors’ voices in Chicago, Washington D.C. and beyond. Read more about our grant from the Kauffman Foundation here.
Last week, we hosted our second 1871 Policy Forum, powered by the Kauffman Foundation. The Policy Forum focused on discussing challenges related to small business regulations.
The first half of the Policy Forum focused on learning about the resources available to entrepreneurs at the local, state and federal levels. Presenters included: Kenya Merritt (Chief Small Business Officer for the Chicago Department of Business Affairs and Consumer Protection), Katy Khayyat (Manager, Office of Regulatory Flexibility at the Illinois Department of Commerce and Economic Opportunities), and Les Davies (Region 5 Advocate, Office of Advocacy at the US Small Business Administration).
During the second half of the Policy Forum, attendees learned about and discussed the challenges, successes, and the future of small business regulations.
If you or someone you know is looking to jump into entrepreneurship or start a small business, make sure you’re familiar with these three tips covered in our Policy Forum on small business regulations.
- Entrepreneurs need a roadmap to small business regulations. While no two businesses are alike, many startups find a common challenge when they try and navigate the complexity of small business regulations. According to the 2017 NSBA Regulatory Survey, “...12 percent of small-business owners say they don’t even know the source of regulations impacting their business (local, state or federal) — a clear indicator that the web of local, state and federal regulations is massively confusing.” Creation of a go-to resource or “road map” would help guide entrepreneurs to the information that they desperately need in order to grow and scale their businesses.
“Everything that happens with the Affordable Care Act is very important to me...it is important to me when I hire and in general people need insurance.” – Reva Minkoff, Founder and President, Digital4Startups Inc.
- Regulations Impact Businesses. It is not a matter of if, but when a regulation will impact your business. According to the 2017 NSBA Regulatory Survey, “the average small-business owner is spending at least $12,000 every year to deal with the cost of regulations.”
“It’s very important that you inform yourself of what regulations are active now and how they’ll impact your business.” – Les Davies, Region 5 Advocate, Office of Advocacy at the US Small Business Administration
While the burden of small business regulations can be immense, programs to support entrepreneurs do exist. For example, the Small Business Regulatory Program, managed by the state’s Office of Regulatory Flexibility, invites entrepreneurs to become part of the rulemaking progress by sharing how specific rules will impact their business. Each year the program submits around 50-75 Small Business Impact Analyses, which help agencies better understand the potential impact of their rules for small businesses.
In terms of policy, the Regulatory Flexibility Act (RFA), which is overseen by the Office of Advocacy at the U.S. Small Business Administration, is a resource for entrepreneurs who are currently impacted by specific regulations. In 2017, Advocacy interventions resulted in regulatory cost savings of $913 million.
At a local level, the City of Chicago’s Small Business Advocacy Division - BACP is working to license, educate, regulate, and empower Chicago businesses to grow and scale. Due to small business reforms, licenses are being issued faster and startup licensure fees have been reduced. Furthermore, reforms have produced services such as Chicago's Pop Up Initiative, which encourages entrepreneurs to create “pop up” experiences throughout the city.
- Advocacy is Power. The overarching challenge discussed at the Policy Forum was clear; many entrepreneurs found it difficult to navigate the complexity of small business regulations. That’s why the first step is to create avenues to support and assist founders so that they may better understand the intricacies of small business regulations -- as the saying goes, ‘you don’t know what you don’t know.’ Additionally, advocacy is perhaps the most imperative resource for most small business leaders. There is no doubt that advocacy helps guarantee that small businesses are heard and seen by the federal government.
At times, it may seem like small businesses only aim to further their own initiatives, but there’s additional benefit that comes from small business success. Our nation depends on small businesses in order to grow our overall economy. The 2018 Illinois SBA Small Business Profile highlights that in Illinois, there are 1.2 million small businesses, which have created 2.5 million jobs.
“Get involved and be informed. Whatever your business is, it’s crucial to get involved. Our voices are stronger together.” – Katy Khayyat, Manager, Office of Regulatory Flexibility at the Illinois Department of Commerce and Economic Opportunities
In terms of policy reform, it is vital that entrepreneurs make their voices heard so that they can positively impact regulation reform. If you have a business or want to start a business in 2019, consider being your own advocate or joining a supportive community of like-minded individuals. Here are some additional suggestions:
Attend a Regional Regulatory Reform Roundtable.
Sign up for the Small Business Connections Newsletter.
Stay informed and send an email to BACPoutreach@cityofchicago.org to join the BACP Outreach & Education e-distribution list to receive updates on upcoming expos, workshops, and vital consumer protection information.
To read more about the first policy forum in the series, titled 'Three Key Takeaways from 1871 and the Kauffman Foundation's Inaugural Policy Forum,' click here. Want to learn more about 1871 Policy Forums? Email CorpInno@1871.com for more information.