Isabel Guzman grew up working the front desk of her father's veterinary practice and never stopped thinking about small business. Now, as founder of Avenida Advisors, she's translating decades of government and entrepreneurial experience into a mission to help founders.
Isabel Guzman didn't plan on a career in policy. She planned on building businesses — starting in the front office of her father's veterinary practice, continuing through Wharton, Penn, and a stint at Procter & Gamble, and eventually back to California to help her dad scale what had become a chain of hospitals. Government found her, not the other way around. But once she was in, she went deep — and what she learned about how capital actually flows to small businesses changed how she thinks about everything.
In this episode, Isabel joins Everett to break down the most common and costly misconceptions small business owners have about working with the government: why the grant era of COVID was an anomaly, not a baseline; why getting a "no" from one SBA lender doesn't mean the door is closed; and why building a strong private-sector portfolio is the single most important thing a founder can do before pursuing government contracts.
Follow Small Business Unscripted so you never miss a conversation.
3 Takeaways:
Timestamps:
[05:50] Why Isabel Left Corporate for Public Service
[09:45] The LA Mega Events Opportunity
[12:00] The Funding Story That Saved a Business
[14:10] Biggest Mistakes with Government Capital
[18:55] How to Win Government Contracts
Isabel’s Best Insights:
"One of the biggest hats you wear as an entrepreneur is a fundraiser for your company. Your ability to sustain and grow really relies on your ability to understand how to fundraise — loans, equity, grants, depending on your structure. I wish they had told me that in the beginning."
"Expect that [getting government contracts] is going to be hard work to learn the rules of the road. Building up your portfolio of private companies can really help you advance further in the government contracting space."
"I'm proud now to say everywhere I go that I've failed multiple times. But that doesn't mean I don't keep going."
Connect:
Isabel Guzman: www.linkedin.com/in/isabelcguzman
Everett Sands: www.linkedin.com/in/everettksands
Learn more about Lendistry: lendistry.com
0:00:00.2 Isabel Guzman: One of the biggest roles or hats you wear is fundraiser for your company.
0:00:04.6 Everett Sands: Wish you'd told me that in the beginning.
0:00:06.7 Isabel Guzman: Yeah. You're fundraiser. Not exactly dialing for dollars, but that is your role. And so your ability to sustain, grow really relies on your ability to understand how to fundraise for your company. That could be loans, that could be equity, that could be grants, depending on what your structure is. And so I do think it's important that all entrepreneurs and founders deep dive on that and spend some time really understanding capital.
0:00:32.2 Everett Sands: That's Isabel Guzman, former Administrator for the US Small Business Administration and lifelong entrepreneur. Most people are either operators or advisors. Isabel's both. She felt the pain of running payroll for her own businesses while also organizing billion dollar relief programs at various government agencies and went right back to being an entrepreneur. Today she's breaking down what actually helps small businesses from the inside out. I'm Everett Sands, your host and the CEO of Lendistry. This is Small Business Unscripted. Let's get into it.
0:01:12.9 Everett Sands: Welcome to Small Business Unscripted. How you doing today?
0:01:14.4 Isabel Guzman: Oh, I'm great. Thanks for inviting me.
0:01:16.2 Everett Sands: Of course, of course. So, I always start off with the same question to everyone, just to kind of get into the mindset. So put these three in order for me: Career, compensation, quality of life. I think that's a little unique question for you, but what's kind of top of mind for you right now?
0:01:30.5 Isabel Guzman: That's shifting. That's shift... Career, compensation, quality of life?
0:01:35.7 Everett Sands: Yeah.
0:01:37.6 Isabel Guzman: I do think quality of life for me includes career in so many ways. So I'm gonna go with quality of life first, but career and compensation to follow. But I've obviously led in a very mission-driven way. I've jumped into public service several times. That's not a compensation focus. And so it's definitely where I focus.
0:02:00.9 Everett Sands: That's awesome. That's awesome. As you think about that, let's kind of start with the beginning. So growing up, father was in small business. Why don't you tell us a little bit about that and how that might have affected you?
0:02:10.1 Isabel Guzman: I think my upbringing was really formative from that perspective. I have a former colleague who says that I must have been born thinking about small businesses because it just feels very innate to me. But yeah, at one year old, my dad started his first veterinary practice. I think I told you the story that they're Texans, but he graduated from Tuskegee and decided I was gonna go straight to California. He was California dreaming about opening a small business. And so I grew up with him going to work for fun because of course, veterinary hospitals got lots of pets and fun things to do. But over time, I was the one who was always working with him in the front office, really trying to understand what his journey was as a small business owner. So entrepreneurship has defined our lives. And he really instilled in us that small business, entrepreneurship, those clients really are the ones who we are grateful to for having carved out our American dream.
0:03:07.8 Everett Sands: Did you start your first business and then go to Penn, or did you go to Penn, which by the way, is an amazing university, everybody should know that, and then start the business? I'm just trying to make sure I get the order right.
0:03:16.9 Isabel Guzman: Yeah, no, I did not start a business in high school or college. I worked for different small business owners in addition to my dad growing up, but went straight to Wharton undergrad and got my teeth into deeper business issues beyond entrepreneurship.
0:03:35.8 Everett Sands: Awesome. Okay. So then Philadelphia, then back to LA, and then you start the [0:03:38.9] company?
0:03:39.5 Isabel Guzman: Actually, no. My journey sidestepped to Ohio. I worked for Procter & Gamble in purchasing, so I've been on the corporate supply chain side of things as well.
0:03:49.2 Everett Sands: CPG, super product goods, I'm assuming.
0:03:51.1 Isabel Guzman: Yeah. And so that was a very interesting experience working at a large corporation. It was really eye-opening, formative for me in many ways. And then I returned to California to work in my father's chain of veterinary hospitals, as well as starting to advise small business owners as well.
0:04:07.8 Everett Sands: I mean, what's the journey like when you see Procter & Gamble or any Fortune 500 that first time? If you grew up in small business, you're used to small business, and then you see Fortune 500 easy, right? Maybe Fortune 100.
0:04:20.5 Isabel Guzman: Yes. Yeah. The systems and the processes and protocols, that was eye-opening for me, obviously. And while as a small business owner we tried to implement the same as we had multiple employees, of course, but to see this massive behemoth of an entity operating at scale globally too was really interesting.
0:04:44.2 Everett Sands: Yeah. I can only imagine. I mean, I remember my first time, at least my first time with Fortune 500. I had to, first of all, I had to learn the acronyms in addition to how to do business and things like that. But to your point, you then come back in a small business, you're like, okay, we gotta chip away at this or think about these things.
0:05:00.1 Isabel Guzman: Level up those efficiencies.
0:05:01.9 Everett Sands: That's exactly right. That's exactly right. Okay. So come back to LA. You help with small businesses. What were you kind of navigating towards? Like what type of businesses were you helping? What type of business were you working in?
0:05:13.4 Isabel Guzman: Yeah. I mean, I enjoyed my work in corporate America, but I did want to come back to California and pursue entrepreneurial dreams as well. Wanted to work with my dad, help him scale his businesses. Our goal was to build each practice to a million. So it was very fun and goal-oriented. But I know that I wanted to pursue my dreams as well. And so this is where I returned. And so shortly after, I did launch a business in partnership and continued. I've launched a couple different businesses, a couple different consulting businesses too, intermittently with public service.
0:05:51.5 Everett Sands: Yeah. Makes sense. Makes sense. When you think about running those businesses, what eventually led you to start thinking about maybe working for state? Because I know obviously you worked for the state of California, so not so much what you did at the state, we'll get to that later but how does that start to transition? Is that just a need or desire to help the businesses? How does that pivot happen?
0:06:12.3 Isabel Guzman: It actually was also something that was very formative for me. I view it as my mom's influence. My dad was the entrepreneur, my mom was the advocate. So, she was a stay-at-home mom and then eventually went back and became a teacher. But she taught me that fight for the underdog because she defended us. She was that mama bear who'd walk into the principal and advocate for us on XYZ. And she really gave me my voice. She taught me how to speak up on behalf of others too, which I did at a young age in the classroom. And so I do think that's what got me interested. And so I was always in government and Junior Statesmen of America and the whole policy realm was interesting to me.
0:06:54.3 Isabel Guzman: And actually before I decided to go to Wharton at Penn, I contemplated doing public policy instead. And so that was like I decided two roads and I took that path, but I think I always was interested in coming back to it. And so stayed engaged in policy and government and had lots of friends in that space. And so for me it was natural knowing a lot of people working in government to sort of be pulled in to serve as well. Because I really believe that communities need support to be able to achieve their American dreams. And so I've always wanted to work on the inside to try to help systemically improve communities and let other people have opportunities.
0:07:33.8 Everett Sands: That makes perfect sense. So just so we make it easier for the audience, you were California government office, Washington DC, Deputy in SBA, back to the Governor's Office, back to the SBA, and we'll get through all that. But I just want to make sure everybody...
0:07:47.7 Isabel Guzman: With entrepreneurship in between.
0:07:48.9 Everett Sands: Yeah. I want to make sure everybody knows like, it's a double stint both ways, right? So then you have your first stint in Washington and that's as a deputy at SBA. Generally speaking, how many deputies are there?
0:08:00.9 Isabel Guzman: I was a deputy chief of staff. Typically there's one at the SBA. Large agencies, there can be multiple, but SBA is about a billion-dollar agency that propels over $55 billion in capital every year. So it's a small but mighty agency. And so I was deputy chief of staff, really overseeing policies and programs and getting deep into what federal policy for small business is.
0:08:25.3 Everett Sands: As you reflect back, do you have a favorite moment in your career, so to speak?
0:08:29.3 Isabel Guzman: What's interesting, because I love operating businesses as well, and being an entrepreneur, that's a passion for me and I tried to bring that lens to the SBA. I challenged my team to be very customer-centric, put themselves in the shoes of these entrepreneurs, truly, and tried to bring to life their experiences as much as possible so we get back to basics on our products. And I do think that leading a small business or leading this massive organization, the same skill sets are required.
0:09:01.0 Isabel Guzman: I mean, you have to create vision and get people to follow you, convince people to invest in you and believe in you and move forward with you. And I do think it also takes an ability to take risks and make decisions quickly. And that means you have to have a deep subject matter expertise and that commitment, that drive and grit that entrepreneurs are. I mean, I know I see it in you all the time, go deep on topics and really understand things so you can deliver the best. And that's what I see in my journey that was the commonality. And I really enjoyed all the experiences. But obviously it was a complete honor. That was really interesting and formative in how I lead.
0:09:46.0 Everett Sands: We're sitting in LA. I mean, it's hard not to think about opportunities and things like FIFA, well, Super Bowl next year, but then FIFA and then the Olympics and things like that. I mean, how do you think about that for kind of small business? Because it's an interesting, it's almost like a jolt. I don't want to say it's a pandemic because obviously, different kind of tones, but that jolt that a business could go through for like a FIFA event or something like that, do you encourage that or do you talk to your businesses differently when they're thinking about things like that, whether to engage in the government or engage locally?
0:10:20.1 Isabel Guzman: Since returning to Los Angeles, I've been able to engage locally in various industries in the sports and entertainment cluster, the mega cluster here in Los Angeles. I mean, we have nine competitive, incredible sports teams, the Dodgers on down. We have, of course, these massive events that are happening. It'll be FIFA as well as Super Bowl as well as NBA All-Star this coming weekend, and of course the Olympics and Paralympics. We're good at these massive major events and games. And it does mean helpful opportunities for small businesses. If you're in that travel and tourism or in the industries where they can sell to and support these events and venues. And so I do think it's a powerful opportunity for small businesses to be aware of what's happening and plug in.
0:11:11.0 Isabel Guzman: I mean, look, we just had the World Series in Los Angeles and it was interesting because I went to Toronto right before their games of the World Series and everyone was so excited. The city was turning over with excitement about what that meant for their small businesses and travel and tourism. And I think... You know, we had the World Series in LA, but it was kind of like, oh, another one. We just have so many of these. But to be able to pay attention to these opportunities and strategize for your business to see how you can plug in, I think is huge because we are, you know, sports and entertainment cluster, life sciences, aerospace and defense, these are all big industries for us. And so for all of those, small businesses should think about how can I leverage being in Los Angeles, take advantage of it.
0:11:58.3 Everett Sands: Thanks, Isabel. We're gonna take a break. We're gonna hear a quick word from from our boss, Lendistry's customer.
[music]
0:12:08.2 Victor Macias: My name is Victor Macias. I represent Sunny Express Gourmet Fast Food. It's a quick service vegan Mexican Chinese restaurant in Compton. So, the problem we were facing before working with Lendistry was getting funding for daily operations and hiring people because of the COVID-19 pandemic that had just passed. So, Lendistry made the loan process very simple and easy. That allowed me to just focus on the business and the customers without having to worry about the financial part. And with that, it also allowed us to keep the pricing down in the community. Everyone else was increasing their prices, and we tried to push and stay as long as possible to not allow the supply chain issues and everything that was going on to allow us to still stay affordable for the community that we're trying to serve. I don't think we would be still in operations if it wouldn't have been for this funding. It kept us alive and we're here now. We were able to overcome that bump. I would 100% recommend Lendistry to people in my industry or in any other industry that are small businesses.
[music]
0:13:24.5 Everett Sands: We've talked kind of about the past. Let's talk a little bit more about the present. And what I'm looking to also do is get some actionable insights for our small businesses as well, just as we go through these next sets of questions. So first, let's remind the audience today about what you're doing. So go ahead and explain Avenida.
0:13:40.8 Isabel Guzman: After public service's last bout, I came back to California, from Los Angeles, and I opened Avenida Advisors. Sort of responsive to some outreach I was getting where people wanted to go deeper on the small business marketplace and really understand how they could engage small businesses in their supply chain or sell products that were beneficial for their operational efficiency or capital. Because clearly, SBA as a lender gave me deep expertise in financial services as well.
0:14:10.0 Everett Sands: And so what are some of the mistakes? And well, maybe we'll talk about the good stuff too next. But let's first talk about what are some of the mistakes that you think small business owners make when they think about engaging with the government or maybe using the capital incorrectly.
0:14:23.0 Isabel Guzman: Yeah. I do think it's important to think about what the government programs are for. I mean, as I said, government will step in when they think they can make a difference in improving economic opportunities and our positioning globally, right? And so for small businesses, it's historically been about engaging them in their supply chain in government as well as thinking how they can improve job creation and good jobs. And so job creation, you need capital to be able to fundraise, to be able to have growth in markets abroad. And so that's been the cornerstone of government programs. It's always based in a loan product more than a grant product. And I do think that for those businesses who went through the COVID pandemic era, there were so many grant opportunities. And typically that's not where the government uses taxpayer dollars.
0:15:16.0 Isabel Guzman: It's usually more in a loan type of product or investment in specific industries or research and development to try to spawn some startups or some technologies that we want to lead in globally. And so I do think keeping that in mind is important because that should remind you of the type of fundraising you have to do to get out there. And so for government programs, it's gonna start to return more to dominance around loans. And unless you're an innovative startup, I want to make sure I clarify that. For innovative startups that are trying to research on the frontier technologies or cutting-edge technologies, there are grants to fund your research because the government wants to see leadership or solve problems that could then be monetized and commercialized. And so that's when you want to search for government federal grants.
0:16:07.2 Isabel Guzman: And then of course locally it's about main streets and revitalizing our main streets. They want to give you grants to boost your storefront offerings or make improvements in your businesses because that's where they're collecting local taxpayer dollars. So, really you have to follow the money and where these governments are really focused on trying to improve your business. But for businesses trying to access capital with the government, keep in mind that a lot of these programs are done in partnership with lenders who have their own oversight bodies as well as their own standards, policies and procedures and SOPs that they have to follow. And so that's important to know that these government programs are still done in the existing private capital markets. And so you got to do your homework, but you also have to know that you might get no from one SBA lender as an example and a yes from another one because as these programs are done through private partnership, it's relying on also their systems.
0:17:10.2 Everett Sands: Right. So, one of the things we educate our businesses on is kind of the growth and evolution. SBA, State of California, they have a lot of resources. How should they think about working with the SBA resources or maybe the state's resources, but maybe even come into Avenida? Like what's that kind of growth like? Is there a certain size they should be or certain income, certain clientele? How do you think about that?
0:17:34.3 Isabel Guzman: So, Avenida Advisors is really focused on trying to help the small business ecosystem. And that means working with more often larger companies or entities or governments trying to create programs.
0:17:50.1 Everett Sands: So they refer their partners.
0:17:51.7 Isabel Guzman: Correct. So for small businesses themselves, there are some incredible free resources for you to use to really level up your businesses. And I think that's where the SBA and the state and the county and the city really shine in terms of trying to connect you with the technical assistance resources that you need to succeed.
0:18:12.3 Everett Sands: All right. So let's go the other way. So, I am an agency and I'm looking to get to the small business customer or to think about how to deploy my resources. That's when I call Avenida.
0:18:22.5 Isabel Guzman: Yeah. Avenida really is trying to be that subject matter expert on the small businesses and the small business marketplace. Helping companies leverage the small business marketplace.
0:18:33.5 Everett Sands: Yeah. I find that that's needed because sometimes it's the old square peg, round hole scenario, right? And look, some of the agencies, they might have two people working there or be under-resourced. I guess they could have 100 people working there but still be under-resourced depending on initiatives or different things like that. So, having consultants or someone that's a subject matter expertise really will help them. That makes a lot of sense to me. Where do you tell businesses to start when they want to just work with the government?
0:19:00.3 Isabel Guzman: For small businesses that want to work with the government, and I think business-to-government sales is a great way to grow your business and have very resilient revenue flows, I think the number one thing is though it's not an easy thing to do business with the government. Expect that this is gonna be hard work to learn the rules of the road, and getting the experts to help you is the best path forward. So there are great organizations, Apex Accelerator, the Small Business Development Centers, who really know government contracting and can help you, position you to be able to succeed. And I think most importantly is know that you have to have past performance to work with the government. So, building up your portfolio of private companies can really help you advance further in the government contracting space.
0:19:55.0 Everett Sands: Let's go the other way. You're an agency, legislative bill just passed and now you have this money and you're thinking about getting it out. Where do they start? Like if you were sitting in, I don't know, the State of California and you were new on the job kind of day one, it's a little bit different because obviously there was some infrastructure there, where would you start?
0:20:13.2 Isabel Guzman: We need innovation in government constantly. We need to be able to scale and roll out programs and meet businesses where they are. And increasingly that is more and more possible with technology, especially because small businesses have adopted technology at such high rates. But I do think that having the knowledge of the small business needs and making sure that programs are structured in a way that can be fully leveraged and with less friction, as simple as possible is what small businesses need. So it's the design of the policy, it's the implementation that matters because having something written into legislation is only half the battle. Really the implementation in a fair and just way that is accessible and available to all constituents is what the task of government leaders is.
0:21:05.1 Everett Sands: Yeah. I found that implementation, execution is like the key to everything. I don't know if it's small business agency. I don't know that it even matters who you are. I just think that's just the way it goes.
0:21:16.3 Isabel Guzman: Well, and I think it's important for small businesses to see that perspective on government. Government is challenged with having to roll out these programs at scale, accessible to everyone. And...
0:21:28.7 Everett Sands: It's almost impossible.
0:21:30.0 Isabel Guzman: It's so difficult. It's very difficult. So, as much as you can continue to be a voice in your community for good government innovation, that's wonderful.
0:21:42.1 Everett Sands: So you mentioned this somewhat. Some of these businesses kind of grew up in a grant world. Doesn't necessarily exist, definitely not at the way it currently is today compared to the past. Some of them might even not fully appreciate lending and different things like that. Where would you tell a business to start? Like, if they were just either interested in capital or looking for resources, where would you just say start? You mentioned that there's different lenders for different policies. They probably never get to see the lenders' policies.
0:22:14.8 Isabel Guzman: I do think for entrepreneurs and small business owners, one of the biggest roles or hats you wear is fundraiser for your company. Your growth is...
0:22:25.2 Everett Sands: Wish you'd told me that in the beginning.
0:22:26.8 Isabel Guzman: Yeah. You're a fundraiser. Not exactly dialing for dollars, but that is your role. And so your ability to sustain, grow really relies on your ability to understand how to fundraise for your company. That could be loans, that could be equity, that could be grants, depending on what your structure is. And so I do think it's important that all entrepreneurs and founders deep dive on that and spend some time really understanding capital and the markets. And there are great organizations, mission lenders like Lendistry, as well as these government entities and others who are willing to help you learn. Not to mention the incredible technology tools that are at your fingertips where you can learn anything as well.
0:23:10.6 Isabel Guzman: And so I think at your pace, when you can, you should dive in deep and understand the difference because taking on equity has its own sets of pros and cons, just like taking on a loan. And I do think understanding that and understanding how you can plug capital in along your growth trajectory is really important. And at all sizes. I mean, I've spoken to founders that went the private equity route and had challenges in really aligning with what their vision was for their company. So, there's definitely deep learning for entrepreneurs in that space.
0:23:45.5 Everett Sands: Makes sense. All right. Two more questions for you. First one, if you could go back and you could talk to young Isabel, what would you tell her maybe do a little bit differently as an entrepreneur, now knowing what you know today?
0:24:00.6 Isabel Guzman: Well, as an entrepreneur, I don't think you realize, one, how hard and challenging it is to fundraise for your growth. And it stagnated one of my businesses during the Great Recession as a result. And so those are hard lessons to learn. And then the second thing is that never be intimidated by a failure. I mean, I do think that we have to, as entrepreneurs, pick ourselves up quickly. And I think that the faster I learned that, it would have been an advantage to me. But obviously, it's a lesson we all learn. But I'm proud now to say everywhere I go that I've failed multiple times, but that doesn't mean I don't keep going.
0:24:47.8 Everett Sands: Yeah. And then I think the second one, which might be similar, what would you tell your dad running that veterinary business if you could tell him?
0:24:55.1 Isabel Guzman: To let me make more decisions. Family businesses are a totally enterprise. But I think with my dad, he had a particular challenge in having to be the face of veterinarian and working literally on pets for eight hours a day, and then had to take home all the business. And I do think you need to surround yourself with a really talented team, know your strengths, know your weaknesses, and figure out how to fundraise and grow to be able to bring on that talent.
0:25:32.8 Everett Sands: Yeah. Makes sense. Well, thank you. Thank you for coming to the show. Really a pleasure.
0:25:37.0 Isabel Guzman: My pleasure.
0:25:38.1 Everett Sands: Thanks for hanging out with us on Small Business Unscripted. Want more? Join us at smallbusinessunscripted.com for additional episodes, helpful resources, and to keep the conversation going. Make sure to follow Lendistry on all the major platforms. See you next time.