The entrepreneurial crusader: Hector Barreto, Small Business Administrator
Hector Barreto is small business; he is passionate about small business. He eats, drinks, walks, talks, and breathes small business. Small business oozes out of every pore in his body. Fortunately, he is also the Administrator of the Small Business Administration (SBA). Barreto is a man consumed by his passion; from finding ways to increase the accessibility of the programs he manages to building channels for small business owners to become suppliers to the federal government and Fortune 500 companies. He is fortunate that his passion is his job.
Confirmed by the Senate just weeks before 9/11, he had to hit the ground running, and he hasn’t stopped since. Congress later passed a resolution, commending the SBA’s response in the aftermath of the attack. “That was the first major challenge that the President, and my team at the SBA had to deal with. As a response, we provided $1.2 billion in disaster relief through guaranteed loans directly to business owners across the country,” Explains Barreto. Providing those loans saved thousands of jobs across the country.
He is like the most fanatical baseball, football, or basketball fan you have ever met. The one that knows every single statistic about every single player, coach, offense, defense, every fact about his team and everything about every opponent his team ever played. You get the feeling that he goes to sleep reading the kind of books on small business programs and technology that usually collect dust on library shelves across the country–and that he finds them riveting and engrossing reading.
Barreto yeas born into an entrepreneurial family in Kansas City, Missouri, “a hotbed of Hispanic culture,” as he jokingly asserts. He comes with a lifelong involvement in developing small businesses honestly. It’s all he has ever known. “Its in my DNA,” he says. As a child he learned about business first hand. When he was 9 years old, he waited on tables at a Mexican Restaurant his parents owned called Mexico Lindo. His parents later opened 2 other restaurants in Kansas City. He helped his patents by working in, and later co-managing, one of the restaurants, an export/import business and a construction company in his hometown.
The Administrator’s father, Hector Barreto, Sr. was a man of distinction and accomplishment; a great American success story and Hispanic-American hero. Hector Barreto, Sr. came to the United States from Mexico in 1958. His first job was picking potatoes for 50 cents an hour.
In 1979, Hector Barreto, St. founded the U.S Hispanic Chamber of Commerce (USHCC). Today, the USHCC represents the interests of more than 2 million Hispanic-owned businesses in the United States and Puerto Rico. These member businesses collectively earn more than $200 billion annually in more than 210 local Hispanic chambers nationwide. A small business owner himself, Hector Barreto, Jr. was Vice Chairman of the USHCC board immediately before being nominated to his current post by President Bush.
“My parents had a great influence on me at an early age. I saw that it took both of them to make their businesses successful. I also learned the value and importance of education. After my graduation from Rockhurst University in Kansas City, I went to work in a large corporation and learned about management. This helped me to think and act on my dream to start my own business. I moved to California and became heavily involved in the Hispanic community. I was in business for 15 years before I met then Governor Bush. Before I came to this job, it wasn’t common for a small business person to run the SBA. My experience helped me to prepare for the opportunity and challenge of running the SBA.”
Today, notes Barreto, “the SBA is known for its loan and access to capital programs, entrepreneur development and government contracting programs. Part of my job is external communications–making the public aware of the opportunities available through the agency.” He adds, “A small businessman once told me I can take a yes or a no, but it is the maybes that kill me. With that in mind we work to take as much of the gray out of all our processes as possible. I could not agree more with the President’s view that small business is the engine of the economy. He has placed a lot of importance on building small businesses on his national agenda.”
Barreto has known the President since his first election campaign took him to California, “I first met the President when he was governor of Texas. He had made a speech to the Latin Business Association in Los Angeles. I was Chairman of the Board of the LA chapter at the time. He gave a speech about the importance of education to business. Everything begins with the basic understanding that business can’t succeed without an educated, capable workforce.”
That meeting was the foundation that changed Barreto’s young life, “I began to help the President with Hispanic outreach across the country. I spoke at the 2000 convention, introducing then Governor Bush. Once elected, now President Bush invited me to the White House in his first day in office. Right after his inauguration, he asked me to join his team. The President has always understood the importance of small business. I traveled extensively with him during his first term; we talked about small business across the country and advocated for SBA programs, I am proud of this experience. It has been a privilege to serve in his administration. I am happy with what we have been able to accomplish at the SBA on behalf of America’s 25 million small businesses.
Barreto is a man with a big agenda to be completed before he leaves the SBA. “In terms of perception and results, I see the SBA as a critical partner for the success of small business in America. This year we will reach 10% of the 25 million small businesses in the country.”
As a manager he places a premium on the importance of continual improvement, “We are working hard to demystify the procurement environment and to create business matchmaking in both the public and private sector. We have had a series of events where buyers from all of the federal agencies and Fortune 500 companies meet with small businesses to develop contracting opportunities and to build business relationships. During fiscal year 2006 we will expand this program so matchmaking can be done online 24 hours a day, 7 days a week.
Longevity is a critical consideration. After over 4 years in office, Barreto knows the agency and knows the job. He is the fourth longest serving administrator to serve in the SBA. The average length of term has been 18 months. “I have only been able to do this job and stay in this job with the president’s support. He dearly understands the importance of the SBA and small business to the health and prosperity of the nation’s economy.”
The Administrator has continually set ambitious goals for himself and his agency. He is proud of his agency’s accomplishments. ‘We are providing training to 1 million more people a year. We have increased small business contracting with the federal government to $69 billion. We are extending more loans to minority women. A 23% small business contracting goal has been set with all agencies in the government. It’s a big achievement; this is more than the federal government has ever bought before from small business. This year the SBA will do more loans in the $0-$120,000 range for $20 billion in loan guarantees than ever before. This is double the amount lent just 4 years ago. The truth is that it has never been easier to get a loan guaranteed by the SBA.”
Barreto understands that it is his job in leading the SBA to help all small businesses. At the same time, regardless of his being Hispanic he understands how critical the growth of minority business is for the future of this country, “We now offer more loans to minorities and women than ever before. One third of all our loans are given to minority borrowers. Loans to Hispanics are up 15% over last year. The total amount of loans extended to Hispanics equates to over $1 billion in capital.”
With an eye towards the future, in addition to providing SBA disaster relief assistance to aid in hurricane recovery relief he has specific ideas about what he wants to accomplish in the coming year. He has four primary areas of focus:
* Make the SBA act like an entrepreneur. While not in the strictest sense a business, Barreto wants the SBA act more business like to more effectively reach businesses that are or could be the agencies customers.
* Increase use of technology to streamline processes. He wants to use technology to further reduce paperwork and simplify SBA processes, reducing the time needed to process the many types of applications for aid the agency receives
* Create partnerships with third parties. The goal is to enhance the resources of his staff and reach more small businesses across the country.
* Build more business matchmaking opportunities and structures. His goal is to continually increase the pipeline for deals between small businesses as suppliers to the federal government and Fortune 500 companies
Hector Barreto works hard to have as great a commitment for his tremendously understanding wife Robin and their 3 children as he does for his job. He tries to live as balanced a life as he can, to travel, read and exercise. BUT, he admits, “This is a job that I love that is all consuming. It must be all consuming for me to be effective in my role in leading the SBA.” His father must be proud.
Roles, Responsibilities and Challenges from Hurricane Disaster Relief
The Small Business Administration (SBA) has a direct budget of $678 million and a staff of 3,967 across the country. Its mission is to help create and grow small businesses and to aid businesses in recovering from physical disasters.
The true size and significance of the SBA is far greater than these numbers suggest. Nearly 20 million small businesses have received direct or indirect help from various SBA programs since 1953. In fact, SBA’s current business loan portfolio of roughly 219,000 loans worth more than $45 billion makes it the largest single financial backer of small businesses in businesses in the nation. In over 1000 Small Business Development Centers (SBDCs) across the country, training is given and funds are awarded to small businesses. There are over 11,000 volunteer staff members working across the country as part of SCORE, the Service Corps of Retired Executives. Last year, the SBA backed more than $12.3 billion in loans to small businesses. More than $1 billion was made available for disaster loans and more than $40 billion in federal contracts were secured by small businesses with SBA help. After 9/11, the SBA provided nearly $5 billion in government aid from guaranteed disaster loans and other services.
* Katrina’s Challenge: After some measure of stability has been restored to the region and all life, property and resources have been secured, the SBA will provide an unprecedented amount of disaster relieve loans and other aid to businesses destroyed by the hurricane. These loans will be given both in the Louisiana, Mississippi area and in businesses across the country lost because their livelihood was dependent on this region. Barreto’s leadership will be badly needed to ensure against fraud and to make sure that only the truly deserving gets this help–as fast as possible.
* The Importance of Being Hispanic
“I am extremely proud of my Hispanic heritage and of being bi-cultural and bilingual. The Hispanic business market in this country is an emerging market. Serving the people that make up this market is where the opportunities and the challenges are. Being Hispanic is who I am and where I came from. I have had a deep and passionate involvement with helping to develop and advance Hispanic business. A big lesson for me that I learned from my family is that it doesn’t matter where you come from or where you start, but where you end up. You are responsible for determining that for yourself. My father came to this country and picked potatoes at 50 cents an hour before he built several successful businesses. My Latino heritage and the lessons I learned about business from my parents imbues me and fortifies me. It has always been a great gift and a tremendous source of pride and never a cross to bear.”
* What’s in a name?
Barreto: Originally from Portugal, the last name Barreto is most broadly found in the Spanish province of Galicia. The Barretos came to America during the Spanish Conquest, settling first in Cuba and then in the region than known as New Grenada.
COPYRIGHT 2005 Ferraez Publications of America Corp.
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