PilieroMazza presents a series of blogs exploring the intricacies of the Small Business Administration’s (SBA) Small Business Investment Company (SBIC) program. This first installment covers the Biden Administration’s AM (Additive Manufacturing) Forward Initiative (the Initiative), the SBA’s SBIC program, and the role the Initiative plays in supporting and strengthening small business government contractors who manufacture and supply goods to the Department of Defense (DOD).
AM Forward Initiative
In the aftermath of the COVID-19 pandemic, global supply chains faced severe and unprecedented disruptions. The 2022 Economic Report of the President discussed, at length, the challenges that a fragile and increasingly globalized supply chain represents to the health of the nation’s economy. Responding to these disruptions, the Biden Administration recently launched the AM Forward Initiative, aiming to leverage the benefits of additive manufacturing, otherwise known as 3D printing. Additive manufacturing represents a significant opportunity for users to simplify the manufacturing process while reducing costs. Such advantages could enable U.S.-based companies to address supply chain disruptions more efficiently, allowing them to bypass global supply chain bottlenecks and enhance domestic production autonomy.
The past decade has seen remarkable growth in the additive manufacturing sector. By establishing the Initiative, the Biden Administration, in partnership with the SBA and the DOD’s Office of Strategic Capital (OSC), will support small businesses nationwide in a bid to capitalize on this growth and the opportunities it represents. Industrial factories nationwide can now manufacture parts and products at scale, as costs associated with the technology continue to decrease. Automotive and aerospace suppliers utilize the technology to develop high-quality and increasingly complex parts, benefitting from the speed and flexibility of production that additive manufacturing provides. Ensuring that small business government contractors are able to embrace these productivity and efficiency benefits is at the heart of the Initiative.
The White House describes the Initiative as a “voluntary compact among large manufacturers to help their smaller U.S.-based suppliers increase their use of additive manufacturing.” The Initiative will stimulate growth and support collaboration between suppliers and original equipment manufacturers in the small business space, and provide financial support for companies that are eager to invest in additive manufacturing. A decrease in lead times for necessary parts, a decrease in production and sale costs, and an increase in workers’ wages are just a few of the expected benefits of the Initiative.
SBIC Critical Technologies Initiative
The Initiative’s announcement follows closely behind the introduction of the SBIC Critical Technologies Initiative (SBICCT), another recent collaboration between the OSC and the SBA. Like the AM Forward Initiative, the SBICCT is a public-private partnership focused on propelling growth in critical technologies, such as semiconductors and biotechnology, while supporting the role of small businesses.
Partnerships like the SBICCT and the AM Forward Initiative highlight the pivotal role that the SBIC program plays in developing successful public-private partnerships. Since its inception in 1958, the SBIC Program facilitated billions of dollars in investments, enabling countless small businesses to innovate and expand. Through the SBIC program, the SBA provides SBIC members with low-cost, government-backed capital to invest in U.S. small businesses. These government-backed loans, in conjunction with private capital, come with a variety of benefits that continue to open doors for small businesses nationwide.
For contractors seeking to harness the potential the above partnerships offer, understanding the SBIC program is critical. If you have questions about the SBIC program, please contact the authors of this blog, Cy Alba or Robert Troiano, or another member of PilieroMazza’s Government Contracts Group or Business & Transactions Group. The next blog in the series explores the intricacies of the SBIC application process and the benefits of acquiring an SBIC license.
Looking for practical insights on gaining a competitive advantage through a deeper understanding of the government’s compliance requirements? Check out PilieroMazza’s podcasts “GovCon Live!” and “Clocking in with PilieroMazza.”