The House Small Business Committee held a hearing Wednesday on entrepreneurial growth, “A Job Creation Roadmap: How America’s Entrepreneurs Can Lead Our Economic Recovery,” calling on successful small business owners to tell their stories of triumph despite economic challenges. The hearing also focused on government regulations which some argue stand in the way of job creation and entrepreneurial growth.
Heath Hall, president and co-founder of Pork Barrel BBQ in Alexandria, Va., started his company during the recession, after coming up with the idea in 2006. Among many of the challenges entrepreneurs face, Hall said he was up against government regulations, issues seeking capital and the hurdles of securing retail outlets and customers.
“Every extra regulation, requirement or delay that the government imposes is a burden that new small businesses have to overcome,” Hall said. “These burdens cost entrepreneurs time and money and often lead to many small businesses prematurely calling it quits, opting to create fewer jobs and slowing innovation.”
But, Hall said, regulations are necessary, and small business owners do not expect or want to be unregulated. However, he testified that the approach the government takes should be streamlined.
“There is no effective safeguard in the system to make sure that regulations are written and enforced in a way that minimizes the burn on [the] honest, well-intentioned small business entrepreneur,” he said. “Small businesses like ours do often feel like the government has a ‘gotcha’ attitude towards our efforts, lying in wait to penalize us for paperwork violations or other errors that really have no relationship to the important goals regulations are meant to advance.”
Also present was Seth Goldman, president and “TeaEO” of Honest Tea, based in Bethesda, Md., who launched his business in his kitchen in 1998. Coca-Cola purchased the company in 2011, and Goldman shared some of the factors that allowed the business to thrive rather than shut its doors over the 14 years it has been running.
“We weren’t desperate to sell, but we did need to expand our distribution, and we also felt obliged to deliver a return to our investors, whose money we had held for ten years,” Goldman said.
The government didn’t get in the way of Honest Tea’s growth, he testified, which was the best gift it could give a company.
“One way that the government did support our growth is through the creation of the USDA Organic standards,” he said. “Having a differentiated product was a key to Honest Tea’s survival, and the USDA Organic seal, which appears on all of our products, helps consumers seek out products grown without chemical pesticides or fertilizers. It is a great example of a government program that helps establish a quality standard without any mandates or large bureaucracy.”
House Chairman Sam Graves (R-MO) said these entrepreneurs represent what America is all about, combining opportunity, innovation and hard work.
“It’s never easy to start a company, and in today’s economy, it’s an even greater challenge,” Graves said. “The trend in entrepreneurship is up, but an entrepreneur’s ability to hire is down. The recession’s high unemployment rates may have encouraged people to start sole proprietorships, but there are many obstacles in the way of growing a company to create jobs.”
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