It’s fairly important for entrepreneurial development programs to find some way of measuring client outcomes so that they can say with confidence that what they do accomplishes good things for clients, communities and public welfare programs. That’s particularly true of SBA partner networks because they constantly have to establish to the satisfaction of Congressional appropriators that their programs offer a good return on investment. The Women’s Business Center program has research undertaken by the Center for Women’s Business Research and the National Women’s Business Council. The Small Business Development Center program has the annual Chrisman Report. And the Microloan program has the Aspen Institute’s MicroTest. And now Aspen has released a longer term study, examining how clients are doing after five years of ongoing services. The report, entitled At The Five-Year Mark: Outcomes Reported by U.S. Microenterprise Clients, does a very good job of illustrating value.

What this report illustrates, in general, is that MED clients who secure microloans accompanied by technical assistance (as required by statute) have a string of very positive outcomes. The five year business survival rate for this cohort of microbusinesses was 88%, while 72% of clients who were not operating a business at intake had started one five years later. Revenues were up appreciably, too, with a mean that had increased to more than $170,000 and the highest earning firm in the cohort making $5.3 million. Probably the most significant finding from this study is the fact that microloan borrowing appears to be the most significant factor in looking at positive outcomes of the greatest magnitude. Borrowers had higher revenues after five years than non-borrowers, as well as greater employment growth and growth in proprietors’ incomes. This also implies that one of the most significant factors in the way most microbusinesses underperform, economy-wide, may be that they tend to be under-capitalized.