SBS Capital Access

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Bidding DDC Contracts:

Financial ResourcesApril 11, 2019

SBS prepares business owners for financing and connects them to capital

Expert AdvisingPrepare businesses for loans and match entrepreneurs with the right financing partner

Short-term Investment

Invest in funds where there are market gaps or opportunities that help

increase access to capital

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NYC builds relationships with lenders across the city…

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NYC Business Solutions Centers

NYC Business Solutions Industrial

NYC Industrial Providers serve

businesses in the manufacturing,

construction, transportation, wholesale,

utility, and film production industries.

NYC Business Solutions Centers serve

businesses in all other industries.

Each Center has at least 1 Finance Account Manager

…and works with businesses to match them with the right lender and walk them step-by-step through the loan process

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Intake & AssessmentApplication Planning & Packaging

Referral to LenderAdvisory Service

• Evaluate financial needs

• Analyze business and personal finances

• Identify best available financial product

• Work with lenders to package loan

• Collect financial documents and complete all forms

• Structure loan request

• Submit final loan application to lender to analysis and review

• Follow up to ensure disbursement of funds

• Provide additional clarify on loan approval/ declination, if possible

• Assist in post-financing advisory

SBS helps entrepreneurs access a variety of loan types from different lenders

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Working Capital50%

Equipment Purchase

18%

Inventory14%

Startup7%

Mobilization Capital

4%

Debt Refinancing4%

Other3%

Banks12%

CBOs10%

CDFIs45%

Crowdfunding12%

Other21%

• Since the start of the Administration, SBS has connected approximately 1,800 businesses to more than$150 million dollars in financing

In addition to helping businesses access capital in the market, SBS invests in funds where there are market gaps

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• Through its ongoing work with small businesses, the City understands gaps and trends in real time

• The City works with private institutions to launch new products, including:

- Hurricane Sandy Business Loan & Grant Program

- Contract Financing Loan Fund

- Bond Collateral Assistance Fund

- WE Fund: Crowd

- WE Fund: Growth

- WE Fund: Credit

WE Fund products help women entrepreneurs access the capital they need to start and grow their businesses

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WE Fund Crowdoffers crowd-funded term

loans at 0% interest for up to $10,000

WE Fund Growthoffers loans of up to $125,000

for established businesses that are looking to expand

WE Fund Creditis coming this spring!

Contract Financing Loan Fund and Bond Collateral Assistance Fund help M/WBEs access contracting opportunities with the City

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$10 Million Contract Financing Loan Fund

$10 Million BondCollateral Assistance Fund

allows M/WBEs and small businesses to apply for low-interest contract financing loans of up to $500,000

available for M/WBEs and small businesses

Mayor De Blasio’s goals for M/WBE program• Award 30% of City contracts ($) to MWBEs by 2021• Double the number of certified and re-certified MWBEs from 4,500 to 9,000

by 2019

Access to financing is necessary to achieve M/WBE goals• Financing is one of the key barriers to accessing and successfully

performing on City contracts. Businesses face challenges supporting project costs to start or get through a contract. Examples of costs include equipment, payroll, materials and other unexpected expenses

Access to bonding is necessary to achieve M/WBE goals• Sureties often require businesses to provide cash as collateral and/or an

assurance of liquidity before providing access to surety bonding. Such an allocation of resources presents an obstacle for many businesses: as a result, companies are unable to access the surety bonds they need to bid or perform on contracts

The M/WBE Funds were launched to help meet Mayor De Blasio’s goal of awarding more contracts to M/WBEs

In Fiscal Year 2017, NYCEDC and SBS launched two funds, capitalized at $10M each, to address these gaps. Since, we have approved $11M and over 60 awards.

DEPARTMENT OF SMALL BUSINESS SERVICES

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Bond Collateral Assistance FundProgram Overview: M/WBEs and small businesses can access guaranty funds of up to $500,000, or 50% of the contract (whichever is less), in order to meet cash collateral requirements for surety bonding on NYC contracts.

The goal of this program is to enhance the ability of business owners to access surety bonds, including bid, payment, and performance bonding, to perform on City construction contracts.

The Fund will help benefit contractors who have trouble meeting the following requirements:• High Credit Score• Past Experience • Collateral

Eligibility:• Have an operating construction business• Be bidding or planning to bid as a prime or subcontractor on a contract with a City

agency or NYCEDC that requires bonding• Additional eligibility requirements may apply

For more information go to nyc.gov/bondfund

Win increasing

size of contracts

Gain Experience

Access higher level of bonding

DEPARTMENT OF SMALL BUSINESS SERVICES

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Recap of Contract Financing Program

For more information go to nyc.gov/contractfinancing

The Contract Financing Loan Fund has helped fund >$50M in contracts

>$10M in >60 approved loans

- 33 Primes, 27 Subs- $50.5M of contracts

supported

Construction, 50%

Goods, 13%

Services, 37%

Supported contracts with over 20 Agencies

Questions?

For more information go to nyc.gov/contractfinancing