There are a lot of reasons firms choose not to move forward with joining the SBA’s 8(a) BD Program. Procrastination, fear of government red-tape, and lack of knowledge are three such reasons. I am going to go over the most common myths people have about the SBA’s 8(a) Certification.  

1.)Your company cannot get 8(a) certified if it has not been in business for at least 2 years.

There is a waiver process for businesses looking to obtain their 8(a) Certification sooner than 2 years. The typical requirements are the following:

a.The owner of the firm has significant industry experience. 

b.The business has one tax return showing revenue, and an income.

c.The owner of the firm works full-time for the applicant concern.

d.The firm has revenue from its inception greater than $150,000.

e.The business and owner meet all other 8(a) requirements.

Note:  A 2-year waiver is not needed if the company is only changing the organizational structure of the business. Example:  Changing a sole-proprietorship to a corporation.  

2.)Your company cannot get certified if your past application has been rejected by the SBA.

The SBA rejects 70% of all applications completed by non-professionals largely in part due to lack of completeness. A firm having its 8(a) applications rejected on the first attempt is very common.  

3.)The 8(a) certification really can’t do that much for my business.

Going back to 2018, 8(a) certified companies received $40 Billion dollars, which represents 5+ Million dollars in annual revenue per 8(a) firm.  

4.)My company should be a well-established mid-tier business before I apply for the 8(a) Certification.

The SBA gives 8(a) companies the ability to engage in Joint Venture Partnerships and Mentor Protégé Arrangements with larger governmental contractors. These relationships can greatly increase a firm’s growth rate by providing the 8(a) firm with expertise, bonding, insurance, financial capabilities, as well as other assistance.  

5.)I must be a 100% member of a minority group in order to prove to the SBA I am socially disadvantaged.

An individual that can trace 25% of their blood-lineage to a presumed socially disadvantaged minority group is eligible for the 8(a) Certification given adequate supporting documentation showing the person holds themselves out to be part of that minority group.

If you are interested in exploring your small business’ eligibility and future business development potential, I always recommend contacting an industry expert such as ez8a or Advance 8a. Neither charge for an initial consultation.