YOUNGSTOWN, Ohio – Teresa Miller, executive director of Valley Partners, believes the overall increase in small business openings in the past few years can be attributed in part to the role played by initiatives through the Small Business Administration, especially when it comes to minority- and women-owned businesses.
According to the SBA’s 2024 Capital Report, both the number of loans to black-owned businesses and the value of those loans have doubled since 2019. In 2024, 5,246 SBA loans were made to black-owned businesses with a value of $1.55 billion, up from $784 million in 2019.
The number of Latino-owned businesses receiving SBA loans also rose to 9,613, with a loan amount totaling $3.3 billion, although the increase was less than double with $1.8 billion in 2019.
Female-owned businesses, which are those with more than 50% female ownership, grew to 15,490 loans issued in 2024, totaling nearly $5.6 billion. That’s up from $3.8 billion in 2019. The report notes the number of women-owned businesses participating have doubled since 2020.
In addition, the SBA’s Small Business Investment Company program, which provides private debt and equity financing to small businesses through SBA-licensed private investment funds, has been growing with a four-fold increase in fiscal year 2023. The program is on pace for $7 billion in investments in 2024.
In Ohio, there were 3,965 SBA loans totaling nearly $1.2 billion in 2024, a 46% increase in loans and a 36% increase in dollar amounts from 2020. Pennsylvania businesses also received 2,540 loans, an 81% increase from 2020, with the $1 billion value marking a 45% increase.
So why are more small businesses taking advantage of SBA loan programs and other opportunities?
Juan Santiago, vice president and Community Reinvestment Act engagement leader at Farmers National Bank, believes one of the reasons more minorities are taking advantage of SBA programs and others is education about those programs.
Santiago helps make sure credit opportunities exist for those with low to moderate income in the Mahoning Valley, as well as small businesses and small farms.
Santiago believes one of the reasons more minorities are taking advantage of SBA programs and others is education about those programs.
“Legislators are passing legislation to help support women, minority-owned businesses and all that, but it’s incumbent upon even us as lenders, our role in the process,” Santiago said. “Are we helping to educate them so they can be successful?”
When businesses succeed, it helps the whole community, he added.
Finding more than one type of financing, a “capital stack” – layering know-how, traditional bank financing, grants, micro loans and the entrepreneur’s own cash – can make a huge difference, according to Santiago.
He notes those from other cultures often come here with an entrepreneurial mindset but need to know how business is done in the U.S., the steps they can take to find resources to help them and an understanding of the U.S. regulations for their business, which can be different.
Miller leads Valley Partners, which helps pair Mahoning Valley businesses with funding opportunities, including the SBA 504 loans.
Miller said that in 2023, 50% of the organization’s financial products went to female-owned businesses, and 25% of their overall lending was to minority-owned businesses. Miller said as 2024 came to a close, those figures were even higher at 55% and 42%, respectively.
In part, she attributes some of Valley Partners’ success in impacting more local businesses to the business resource center, which started in 2022. Offering free technical assistance to any entrepreneur or any business owner looking to start, pivot or expand, the business resource center offers lunch and learn seminars and counseling hours.
“We are out in the community much more,” Miller said. “We’re engaging much more.”
Additionally, Miller said Valley Partners became a Minority Business Assistance Center through the state of Ohio and a Community Financial Development Institution, which provides federal assistance to help underserved minority- and female-led businesses. The CFDI program targets underserved areas, including both Youngstown and Warren.
Miller said Valley Partners has been “blessed with four minority staff members” who help the organization connect and engage better with minority communities.
Increasing awareness of the opportunities through organizations like Valley Partners makes a difference. So does creating a community of people who are succeeding and can show the way.
“You can identify with someone who looks like you or has a similar story or background,” Santiago said. “And so it is inspiration when you see folks or people you can relate to doing it, and it gives you a little further inspiration.”
So what is the SBA focused on in 2025?
According to the Capital Impact Report, the SBA’s new Working Capital Pilot, launched late in 2024 will expand the businesses qualifying for SBA loan products with both transition-based and asset-based WCP programs and innovative fee schedules.
Additionally, the SBA’s future focus is to create more equity financing in 2025 and target technology businesses. Those seeking green or clean energy transition money should find more help available through the Green Lender Initiative.
Pictured at top: Teresa Miller, executive director of Valley Partners.