A short-lived directive last week by President Donald Trump to freeze federal grants and loans should serve as a reminder of how unpredictable entrepreneurship can be, an Orlando tech leader said.
Carol Ann Dykes Logue said the episode sparked inquiries from businesses that rely on research and other federal grants to fund their work.
Logue is director of both the Central Florida Tech Grove and UCF’s Business Incubation Program, which each provide services and connections to dozens of area companies.
The region is one of the most dense in the U.S. when it comes to federally funded research grants.
In a whirlwind 48-hour period, Trump’s Office of Management and Budget announced the directive last Monday evening, a federal judge temporarily blocked it Tuesday before OMB officials rescinded the order Wednesday.
Still, it should be a lesson for entrepreneurs, Logue said.
“Whenever you have a new administration, you don’t know what is going to happen,” she said. “It’s shades of the pandemic, during which the world shut down and funding wasn’t flowing.”
Trump set off a storm of confusion on Monday when he ordered a pause on federal grants and loans, a wide-reaching move that temporarily paused funding for a number of public programs.
Logue said there was uncertainty among the local business owners who had heard of the move on whether it affected them or not.
“When something like this happens, it can illicit fear and anxiety and maybe a little bit of panic,” she said. “There is so much to sort out. There are so many questions and so few answers.”
The move appeared to be a blanket stoppage of any federal grant, including those related to research being done across the country. Many Orlando companies, both small and large, rely on these federal research and development grants.
In addition, some work side-by-side with businesses that have projects being funded by these grants.
Logue compared the event to others including the pandemic and years when Congress would have a standoff over the federal budget.
“It’s not like we haven’t had these situations but this is a new reason,” she said.
Logue said about three-quarters of research funding at the University of Central Florida comes from federal grants, with the rest covered by both industry and the state of Florida.
At the onset of the coronavirus pandemic, Logue said the incubator swiftly created a series of town hall meetings to keep its members informed on the latest.
The plan, at least last week, was to do something similar.
However, either way, it’s an illustration of what a strength-in-numbers style environment like a business incubator can do beyond the surface-level offerings.
“It allowed them to talk about what they were going through and share with each other,” she said.
Here are four tips Logue shared to ensure your business isn’t disrupted through external factors.
- Meet your commercial banker and get to know them so when problems do arise, they already know you and have a relationship.
- Have great relationships with customers.
- Maintain good communication with employees.
- Know your financials well.