Small businesses are in line to get help from government loans -- unless they've taken venture capital, or private equity money.
, managed through the Small Business Administration.
In some cases, even if a start-up has 30 people working there, it could be "affiliated" with the thousands of other employees at its investors' separate portfolio companies. Therefore, it wouldn't be eligible for SBA loans. The House of Representatives was working to pass the $2 trillion plan on Friday, which would later go to the president's desk to be signed. Even if the bill does get passed in its current form, Field said there could be added clarification or guidance from Treasury or the SBA that would ease the affiliation rules for VC-backed start-ups.One potential hang-up is the perception that start-ups have unlimited access to venture capital cash. Private equity, which includes venture capital, had $1.
Reena Aggarwal, vice provost and finance professor at Georgetown's McDonough School of Business, said the way the bill is written now, most start-ups are considered affiliates of their private equity of VC firms. But there's "not much political interest" to change the way it's written, she said.
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