Читать книгу The Post Pandemic Economy - William E. Scholz - Страница 12

The disbursement of capital to entrepreneurs is the lifeblood of the economy, if privately held small businesses are its backbone. Businesses need capital. While the stock markets serve corporates with an infinite supply of capital, small businesses are left without a consistent supply. The challenge of capital for small and medium sized businesses is well documented and consistently proven to be the number one reason why cities outside of the coasts falter.

A National Capital Bank (NCB) will provide equity capital to regional affiliates who will invest in small to mid-size businesses operating at a local or regional level. The Bank will be the authoritative source of capital inflow data to determine precisely how much risk capital is needed in each region.

The NCB is funded through a public-private partnership where equity investors can earn a fixed annual return on their investment like the investment operating structure of a Real Estate Investment Trust. The Government will not earn a return on investment, but all return on investment will be redistributed to entrepreneurs in the form of startup or business expansion grants.

Local affiliates of the NCB will operate on a two-tier level. Portfolio managers and grant managers will be in two distinct departments from one another without the ability to coordinate on investable companies. Appointees to local affiliates will be democratically elected via the State electoral system.

For investors, the NCB offers the opportunity to mitigate the volatility of small business equity investment. Currently, the highest barrier to equity investment in regions outside of the coasts is the volatility of investable opportunities. Payoffs can take a decade. Liquidity begets liquidity and many smaller regions are not blessed with the success of one or two high value exits. Subsequently, venture capital networks are not watered with enough nutrients to achieve a flourishing garden of companies.

"Scale-up" capital is also desperately needed in small to mid-size economies, especially in the manufacturing sector. Redeploying advanced manufacturing abilities within established manufacturers is critical to the national interest, especially in the face of a rising China. Manufacturers are currently not innovating fast enough and access to growth capital is a key component in changing the mindset and growth capabilities of privately held manufacturers helping them flourish as companies optimized for International growth.

A National Capital Bank, with regional affiliates, offers a decentralized solution for capital deployment and management in the future, that will rapidly re-establish opportunity and prosperity for American small businesses. We must move quickly to fund an NCB within eight to twenty-four months to accelerate The Great American Renovation.