Monday, November 23, 2009

Goldman Sachs & small businesses

This is now old news, but we'd be remiss if we didn't mention it. Last Tuesday (11/17), Goldman Sachs announced that it was partnering with Warren Buffet to provide $500 million in a "10,000 Small Businesses" plan. I learned about it from the Wall Street Journal last week.

The article focuses on the actual plans for the fund. These won't be direct loans to just anyone. $200 million is earmarked on "education and training programs" (they're big on mentoring), and the remainder will be (according to their press release) "a combination of lending and philanthropic support to Community Development Financial Institutions (CDFIs)".

The education and training programs will be targeted primarily at "underserved" small business owners, and will be taught primarily at community colleges and universities. Our own SBDC at LaGuardia Community College in Queens will be the first to offer such training, in the spring of 2010.

As the WSJ article mentions, this announcement has generated a lot of inquiry from small business owners desperate to navigate their way out of the current credit crunch. Based on the PR material released, though, it doesn't seem to be providing a different kind of direct investment.

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