What comes to mind when you think of a small business? Many people think of mom-and-pop storefronts. Others may define a small business according to size.
So just what is a small business?
The one definition that matters most is the one provided by the Small Business Administration, which defines it as one that is independently owned and operated, is organized for profit, and is not dominant in its field. The small business industry and size (in terms of employee head count or annual receipts) also factors into the definition and can vary widely. Generally speaking, we can think of a small business as one with 500 employees or less.
The latest small business statistics available for Illinois through the SBA Office of Advocacy (www.sba.org/advocacy) are from 2009. That census showed there were 1,123,273 businesses in the state, of which about 77.4 percent are classified as non-employers. Thats 869,266 "solopreneurs."
Small businesses employ 47.9 percent of the private sector workforce, representing approximately 3.7 million jobs, while large employees (some of which can still be classified as "small business" depending on their industry and annual revenues) represent roughly 3.4 million jobs.
Why does the small business classification matter so much? Here three main reasons: Funding, advisory services, and special programs.
Loan Guarantees: The SBA provides loan guarantees through lending institutions to qualified small businesses, assuring the lender that these loans will be repaid, eliminating some of the risk to the lender.
Venture Capital: The SBAs Small Business Investment Company (SBIC) Program is a public-private investment partnership. The SBA provides additional funds to SBICs, supplementing the capital raised from private investors. .
Counseling: Illinois Small …