Criteria to Become a Certified Small Disadvantaged Business (SDB) and 8a Certification through the Federal Governments Small Business Administration (SBA)
The 8(a) certification is DIFFERENT than any of the other certifications in that it is a BUSINESS DEVELOPMENT PROGRAM. You are required to work with a mentoring firm which will oversee and assist with your business planning. If you are not interested in oversight or being mentored, then this certification is not for you. If you’re interested in bidding on Federal Contracts then you should choose the SDB program.
A designated business meets the requirements for the 8(a) Business Development program when it is a small business which is capitalized, owned, controlled and managed by one or more socially and economically disadvantaged individuals. Persons must be of good character, U.S. Citizens and the business must demonstrate a potential for success. This certification is for the socially discriminated and economically disadvantaged individuals as defined in the Small Business Act.
The 8(a) Program offers numerous assistance programs to socially and economically disadvantaged business. The SDB certification strictly pertains to benefits in federal procurement (see DBE firms). Firms achieving 8(a) certification automatically qualify for SDB certification and are then eligible to bid on federal contracts.
The 8(a) Program participation is divided into two stages: the developmental stage and the transitional stage. The developmental stage is four years and the transitional stage is five years. Participants are reviewed annually for compliance with eligibility requirements.
8(a) General Requirements for Certification:
- Must be at least 51% owned and controlled by a socially and economically disadvantaged individual(s).
- Minority Groups as identified the MBE description are welcome to apply. However, every applicant MUST PROVE discrimination
- Anyone else can apply for the program; but you must unequivocally prove, through a preponderance of evidence disadvantaged due to race, ethnicity, gender, physical handicap or residence in an environment isolated from the mainstream of American society.
- Person net worth can not exceed $250,000 do not included owner equity in business or value of primary residence.
- Business must not exceed applicable size standards for small businesses (see DBE page).
- Two full years of business operations (however, a 2 year business waiver can be obtained).