Buffett and Goldman pump $500 million into small businesses

Posted Nov 18th 2009 8:00AM by Tom Taulli
Filed under: Goldman Sachs Group (GS), Small Business

If anything, the financial implosion has been a boon for Goldman Sachs (GS), which has posted record-breaking profits and bonuses. The turmoil has also been nice to billionaire investor, Warren Buffett, who is snapping up juicy deals.

Unfortunately, millions of Americans remain unemployed. What's more, small businesses continue to suffer, as sales are tough to grow and financing is almost impossible.

With this in mind, Buffett and Goldman have teamed up for something unique -- that is, to launch a $500 million program to promote small businesses in the U.S.

True, this sounds like a PR move. But the plan is still a big deal. In fact, I'd rather have $500 million come from Buffett and Goldman -- instead of the U.S. government.

Essentially, the plan will benefit 10,000 businesses through an advisory council that will be chaired by Goldman's CEO Lloyd Blankfein, Buffett and Harvard business guru, Michael Porter. There will be an assortment of services, such as education, networking, grants, community support and financing.

This is certainly a sound approach. After all, it's common problem that -- if even if a company gets financing -- there will be still difficulties if there is not a good plan. Hopefully, Buffett-Goldman will provide the necessary tools.

No doubt, small businesses are critical for the U.S. economy. They are a source of employment and innovation in our country. And they ultimately spur long-term growth.

So, if the Buffett-Goldman plan can light the fire of small businesses, it's definitely a much-needed thing.

Tom Taulli is the author of various books, including The Complete M&A Handbook.

Tags: featured, goldman sachs, gs, inthenews, Warren Buffett

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Reader Comments (Page 1 of 1)

11-18-2009 @ 11:31AM

Frank Fitton said...

The $500 million though is really a drop in the bucket compared to the kinds of numbers this company throws around. Its almost insulting in a way, but at this point we are the dog underneath the table and are willing to take whatever scrapes these people want to toss our way.

So are we supposed to get excited about this? I wouldn’t exactly say that, but I wouldn’t completely scoff at it either. They didn’t have any reason or were mandated to do this in anyway. Of course its a blatant PR move, but its not a bad one. Its really in their best interest too for as the economy soars so do their profits. Its really just a win win situation for everyone involved. Some more money possibly in line with the kind of money they’ve been paying out in bonuses would have been nice, but who are we really to complain.

I don’t really blame Goldman Sachs for the financial crisis, they were simply going about their businesses. Looking back at it, things could have been done differently of course, but hindsight is always 20-20. Its refreshing to see someone step up to the plate and admit that they didn’t handle things as well as they could have. Is it sincere? Probably not, but at this point its all we’re going to get and its better than nothing.

Check out my blog on the Goldman Sach's penance offering at.... http://www.thedebtgazette.com/2009/11/goldman-500-million-penance/

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