SBA Proposed Rule Clarifies Mentor-Protégé Misunderstandings

In August, the Small Business Administration issued a proposed rule that was packed to the brim with changes to many of the SBA’s small business contracting programs. We’ve mentioned a few of the changes in prior blog posts. Gregory Weber, discussed potential changes to the SBA’s 8(a) Business Development Program that may result in more relaxed requirements. While Shane McCall, recently took a deep dive into proposed changes to past performance requirements for joint ventures. Today, we will focus on two additional proposed changes to the SBA’s Small Business Mentor-Protégé Program.

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SBA Getting Strict on MPA Language

One of the most popular programs in small business federal contracting seems to be the SBA’s Mentor-Protege Program. It is generally a great program for small businesses to utilize the resources and knowledge of a larger or more experienced business to grow. In turn, it also gives large businesses the ability to work on small business contracting opportunities, and the Government the ability to contract with more robust teams. Unfortunately, there has been a recent trend of the SBA being somewhat strict on minor language in Mentor-Protege Agreements, possibly stifling participation in the program, or at least making it take longer for SBA to approve these agreements.

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Common Misconceptions: SBA’s Mentor-Protégé Program (Part II – Participation Rules & Limits)

The SBA’s Small Business Mentor-Protégé Program (MPP) is arguably one of the federal government’s most successful undertakings when it comes to supporting our nation’s small business policies, economy, and contracting goals. It fosters the development of small business protégés, allowing many different forms of mentor assistance. It includes opportunity for eligible protégés and their mentors to joint venture (JV) for set-aside contracts—often otherwise off-limits to mentors that don’t qualify for the set-aside status/size standard and/or to protégés incapable of competing for or performing such contracts on their own. MPP JV awards may also incentivize federal government customers—simultaneously getting closer to meeting their set-aside quotas and getting the know-how, qualifications, resources, and personnel of more experienced (typically larger) contractors.

While it’s easy to see why this program enjoys immense popularity amongst small and large businesses alike, confusion consistently shrouds SBA’s MPP, nevertheless (hence the need for a two-parter here). In this article, we’ll skip over the “basics” of SBA’s MPP (which you can read all about here) and instead, jump right into the last few common misconceptions surrounding the program (you can read about the first few in Part I).

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Common Misconceptions: SBA’s Mentor-Protégé Program (Part I – MPP JVs & Affiliation Shield)

The SBA’s Small Business Mentor-Protégé Program (MPP) is arguably one of the federal government’s most successful undertakings when it comes to supporting our nation’s small business policies, economy, and contracting goals. It fosters the development of small business protégés, allowing many different forms of mentor assistance. It includes opportunity for eligible protégés and their mentors to joint venture (JV) for set-aside contracts—often otherwise off-limits to mentors that don’t qualify for the set-aside status/size standard and/or to protégés incapable of competing for or performing such contracts on their own. MPP JV awards may also incentivize federal government customers—simultaneously getting closer to meeting their set-aside quotas and getting the know-how, qualifications, resources, and personnel of more experienced (typically larger) contractors.

While it’s easy to see why this program enjoys immense popularity amongst small and large businesses alike, confusion consistently shrouds SBA’s MPP, nevertheless (hence the need for a two-parter here). In this article, we’ll skip over the “basics” of SBA’s MPP (which you can read all about here) and instead, jump right into the first few common misconceptions surrounding the program (with the rest to follow in Part II).

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Webinar! Mentor Protégé and Legal Aspects To Be Mindful Of on June 5, 2024

Please join Federal government contracts attorneys John Holtz and Stephanie Ellis for this informative webinar, hosted by the Catalyst Center for Business & Entrepreneurship, on June 5 at 10:00 am CDT.

The SBA’s Mentor Protege Program allows two or more businesses to come together and form a joint venture to bid on small business set-aside government contracts. One of the most advantageous aspects of this program is the ability for a large business to mentor a small business through the use of a joint venture. When a large business mentors a small business, the SBA approved joint venture can obtain and perform small business set-aside contracts despite the size of the large business. Join us as we discuss the recent changes in the SBA’s Mentor Protege Program and explore how you can use this program as a tool for scaling your business (whether large or small). Register here.

Free Webinar! The SBA Mentor-Protégé Program hosted by Washington DC APEX Accelerators, February 27, 10:30am -12:30 PM EST

Touted as a “game-changer” when it was first introduced in 2016, the U.S. Small Business Administration’s All Small Mentor-Protégé  Program isn’t new anymore. Known now as simply the “SBA Mentor-Protégé  Program, it is still extremely powerful for large and small contractors alike.

In this webinar, Gregory Weber and I will explain the ins and out of the SBA Mentor-Protégé  Program, covering the program’s eligibility requirements, its potent benefits (including the ability to form special Mentor-Protégé  Joint Ventures), the application process, and common misconceptions and pitfalls. Target Audience: Small Businesses (SDVOSB, WOSB, HUBZone, 8(a), SDB) and large businesses interest in doing business with the federal government. Please join us and register here. And thanks to Earl King of the DC Department of Small and Local Business Development and Apex Accelerator for organizing this event.

Yes, No, Maybe? Understanding the Reason Behind SBA-Required Mentor-Protégé Agreement Questions

The SBA’s Mentor-Protégé Program offers a myriad of benefits to both Mentors and Protégés who participate in the Program. Small business Protégés benefit from the assistance provided by their SBA approved Mentor, which can include anything from guidance on how to find solicitations and make offers, to financial support in the form of loans or bonding. Mentors benefit because participation allows them to compete for and be awarded contracts in which they may not otherwise qualify for. In fact, SBA even provides a bare bones template for Mentor-Protégé Agreements, complete with 21 yes or no questions that every Mentor-Protégé Agreement must include. A “yes” answer to any of those questions requires the applicant to provide additional information demonstrating why this should not disqualify the Mentor and Protégé from working together. But have you ever stopped to consider the reasoning behind these questions? Likely not, if you have never had to check a “yes” answer. However, knowing the “why” behind these questions is information that every small business federal contractor could benefit from. I’m going to take you through these questions to demystify their application, which will allow you to quickly identify potential problems in the future.

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