Goldman Sachs launches $500M small-business venture

Or it could be a big dud.

In the wake of the Wall Street firm’s 10,000 Women initiative — which taps academic institutions and nonprofit entities to provide assistance to female entrepreneurs around the world — Goldman announced it developed 10,000 Small Businesses, a five-year program designed to offer loans and grants to small businesses while linking them to community colleges, universities and other institutions that will provide business and management education.

In Tuesday’s announcement, Goldman Sachs committed to providing $200 million to educational institutions for scholarships aimed at “underserved small-business owners.” The financial powerhouse also will contribute $300 million to lending and philanthropic organizations to “increase the amount of growth capital available to small businesses in underserved communities.”

As part of the initiative, Goldman Sachs also will tap its own employees, and will work with national and local business organizations to provide advice, technical assistance and networking to small-business owners.

“Small businesses are innovators and leaders, and will help lead an economic recovery,” said Melissa Sharp, a spokeswoman for the Washington, D.C.-based National Federation of Independent Business. The organization’s chief executive officer, Dan Danner, sits on the 10,000 Small Businesses’ advisory council, along with Goldman Sachs CEO Lloyd C. Blankfein, investor Warren Buffett and Michael Porter, of Harvard Business School.

“Businesses from New Jersey and across the nation will benefit from this effort,” Sharp said.

Goldman Sachs has so far named LaGuardia Community College, in Queens, N.Y., and Seedco Financial Services, a New York-based community development financial institution, as program participants. Goldman Sachs did not respond to a reporter’s request for more information.

The lack of details made a skeptic of at least one New Jersey entrepreneur.

“Making money and training available to entrepreneurs is great, but how exactly will Goldman Sachs do it?” asked Jay Trien, senior partner of the Morristown CPA firm Trien, Rosenberg, Rosenberg, Weinberg, Ciullo & Fazzari and president of the Venture Association of New Jersey. “If it’s run in a bureaucratic manner, then the effort is not likely to be very successful.

“But having said that, I’m glad that Goldman Sachs is heading the effort, instead of a Washington, D.C., bureaucrat.”

E-mail to mdaks@njbiz.com