Small business will pave the road for recovery. What a lovely thought.
The Big Trend
More capital starvation. One of many haunting data points: Bank reserves now exceed the U.S. Federal Reserve's regulatory floor by $1 trillion; before the credit crisis, excess reserves (the inert stuff banks hate to hold) came to only $2 billion. It may take another year for things to loosen up. Result: Companies that have neither the huge growth prospects to attract venture capital, nor a river of steady cash to entice skittish banks, will go wanting.
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The Unconventional Wisdom
Spur job growth by nurturing mid-sized businesses. Only 5.8 million of the 25 million businesses in the U.S. have employees, and just 650,000 of those have at least 20 employees. Most small businesses (which politicians and pundits love to laud as the primary engine of job growth) serve local consumers, businesses and governments--many of whom are tapped out at the moment. Midsize businesses can take advantage of national and global markets, and in turn put people back to work. Now.
Original Article: Brett Nelson On Entrepreneurship - Forbes.com
