A more thorough explanation:

The Small Business Investment Act is a federal law that was first passed in 1958. It allows investment companies to be created and licensed to provide long-term equity capital to small businesses. The Small Business Administration is responsible for implementing this law.

For example, if a small business needs funding to expand its operations, it can seek out an investment company that is licensed under the Small Business Investment Act. The investment company can then provide the necessary capital to help the business grow.

The Small Business Investment Act is important because it helps small businesses access the funding they need to succeed. Without this law, many small businesses would struggle to find the capital they need to grow and create jobs.