Obama Appoints Venture Capital Executive to Head Small Business Administration

President-elect Barack Obama has nominated Karen Gordon Mills as Administrator of the U.S. Small Business Administration (SBA).

Mills is president of MMP Group, a private equity investor and adviser, a former founding partner and managing director of Solera Capital, a New York based venture capital firm and lead director of Scotts Miracle-Gro, according to the Washington Post.

The appointment seems to confirm a prediction by the American Small Business League (ASBL) that Obama will support federal legislation and policy that will divert billions of dollars in federal small business contracts to America's wealthiest investors. (http://www.asbl.com/showmedia.php?id=1232)

From January 2001 to October 2008, Obama received more than $1 million in campaign contributions from the venture capital industry, according to Maplight.org. (http://www.maplight.org/map/us/interest/F2500) In addition to contributions to the Obama campaign, members of the National Venture Capital Association (NVCA) have donated millions of dollars to key democratic leaders such as Nancy Pelosi, John Kerry and Hillary Clinton.

Obama angered small business groups like the ASBL earlier this year when he dropped a campaign pledge to end the diversion of federal small business contracts to corporate giants. (http://www.asbl.com/showmedia.php?id=1202)

This is a clear indication that President-elect Obama and the democrats in congress intend to sell America's small business contracting programs to wealthy venture capitalists. They have been putting this together for over a year now. It looks like he is going to create another loophole that will divert billions of dollars away from the middle class economy and into the hands of wealthy investors.

Comments

[demographx]

If Karen Gordon Mills actually is anti-small business, I am very disturbed by the discrepancy between Obama's actions his words. The support of small businesses (creator of most jobs in this country) is more critical to the success of our economic turn-around plans than is saving GM/Chry/Ford. This makes no sense.

[kevlar0076]

From my research, it seems that at most, about 1% of small businesses receive VC backing, and with 26 million small businesses in the US, that is a very low percent. The other 99% of small businesses must get financing through the normal means, either commercial loans or through government programs. For a long time now, the venture capitalist have wanted entry into the federal small business programs so they can subsidize their investments with taxpayer money, look at the battle is currently being waged over the SBIR program as a perfect example of this. I think the small businesses that are fortunate enough to get VC backing do not need to take scarce resources away from the other 99% who are struggling. Obama's appointment of Mills to head the SBA concerns me due to the fact that she has no small business experience and currently sits on the boards of several very large multinational corporations. Just because she has VC experience does not mean she has a positive view of or experience with small businesses, she has experience in taking over small businesses and then selling them off. The way things have been going for small businesses over the course of the Bush Administration, which has been devastating, it does not seem like things will turn around under Obama either.

[fatcity]

venture capitalists in general take control of their investments including a majority of the equity. Often they lend money to the venture, take equity control and reduce the % of equity for the indea, the managment and the work. the divisions of equity almost never favor labor, the idea or the management.

[Sumocat]

Don't venture capitalists specifically invest money in small businesses? By definition, the term "venture capital" refers to investment in businesses that are too small to solicit public investment or secure big loans. Seems like we'd want someone who invests in small businesses to be in charge of helping small businesses.