Linda McMahon Wrestles With a New Challenge The SBA
Linda McMahon has entered the ring as President-Elect Trump’s choice to run the Small Business Administration, having spent many years at the helm of World Wrestling Entertainment, Inc. (WWE). McMahon and her husband, Vince, took over the company from his father in 1982, and “helped [it] grow … from a modest 13-person operation to a publicly traded global enterprise with more than 800 employees in offices worldwide,” according to a Trump statement.
As President and later CEO of the company, McMahon was involved in all aspects of the business, from contract negotiations to merchandise development to social responsibility programs. McMahon resigned from WWE in 2009 to run for public office, losing two senate races in her home state of Connecticut in 2010 and 2012.
The SBA has a budget of more than $10 billion and last year approved more than 70,000 government-backed private sector loans. Little has been written about McMahon’s specific plans for the SBA, but we do know she supported an Obama proposal to merge the agency with the core functions of the Commerce Department and a number of other entities back in 2012 -- a proposal that ultimately didn’t gain much traction, but would have eliminated the Cabinet-level position she’s now poised to hold.
So far, she has kept mum on her plans for her new role, but during her senate campaigns she favored rolling back the Dodd-Frank financial reforms and cutting business taxes. It’s reasonable to assume that she will look to reduce regulations for small businesses, but we’re not aware that she has taken a position on the Affordable Care Act specifically. Given the furor regarding repeal of the law, she may not see the need to.
McMahon is seen as an advocate for women in business, having founded Women’s Leadership LIVE, a company geared toward promoting leadership opportunities for women, after she left the WWE. With this in mind, it will be interesting to see if McMahon’s previous experience translates into greater investments in women-owned businesses -- in 2016, only 18% of all SBA loans made under the SBA 7(a) loan program went to women-owned businesses, and 26% went to minority-owned businesses, according to this article in The Hill. The authors of the article, Mike O'Donnell and Richard Eidlin, say she should “expand funding to modernize the SBA microloan program, 8(a) business development program, and women business development centers.”
Further, they’ve called on McMahon to promote community bank lending to small businesses, expand the program for investments in microentrepreneurs, increase support for employee-owned cooperatives, and increase government business with small companies. Another small business expert, Rohit Arora, offers his own recommendations in this Forbes article -- his first is that the SBA needs to upgrade its technology, which currently does not allow for online loan applications or eSignatures, resulting in a less-than-consumer-friendly experience.
Time will tell how Linda McMahon chooses to address the myriad issues facing small businesses across America.