As head of the U.S. Small Business Administration, Karen Mills focuses on fueling the economy through small business growth.

Mills has never been CEO of a small business but as an executive at E.S. Jacobs & Company, a now-defunct private equity company based in New York, Mills worked on the ground with a number of small manufacturers. After earning a Harvard MBA, Mills joined General Foods Corporation as a product manager, and then was a management consultant at McKinsey & Company. From 1999 to 2007, she was a co-founder and managing director of Solera Capital, a New York venture capital firm, which invested in women-owned companies. Until 2009 she was president of private equity firm MMP Group in Brunswick, ME.

She is only the second woman to be SBA administrator. (The first, Aida Alvarez, was appointed by President Clinton in 1997.) contributor Joseph Rosenbloom recently caught up with Mills at her office in Boston.CK The following is an edited version of his interview.

When you arrived at the SBA in 2009, many small businesses were desperately groping for financing. What did you do to help?
We were in the middle of an enormously difficult financial crisis. Lending to small businesses from banks had really stopped. We were able to pass the American Recovery and Reinvestment Act. Immediately, we had to get that money into the hands of small businesses.

So we had to gear up an entire network and bone structure of SBA operatives and activity in the field to our banking partners. We were able to attract about 1,200 banks back to SBA lending and put $50 billion in the hands of small business.

Did the bone structure save a lot of companies?
As I’ve traveled around the country, it has surprised me how many times I’ve heard people in small businesses use that word saved. I believe many small businesses would not have had access to credit and would not have survived without the $50 billion that we were able to put into the market.

You’ve never been the CEO of a small business. But didn’t you gain somewhat comparable experience in the 1980s when you worked for a private equity firm that specialized in small business investment?
I was the chief operating officer in charge of the industrial companies that we owned. There were half a dozen to a dozen of those businesses over the course of about 10 years in everything from plastic injection molding to hardwood flooring. I was hands on: fixing the factory floor, saving money, and allowing us to survive the recession of the early nineties.

Did you identify leadership techniques that were particularly useful in running a small business?
I found that, by tracking two or three but not more than five, key numbers, I was able to keep my finger on the pulse of activity. And I was able to see problems before they became large. One key number one was always cash on hand. A second was always weekly sales. Other key numbers depended on the business. Sometimes it would be advance bookings. Sometimes it would be a critical cost metric—resin cost in the case of a plastics denture molder, for example.

Given the still fragile state of the economy, are you likely to restore the enhanced loans—the higher guarantees and fee reductions or waivers—that were in effect during the height of the crisis a couple of years ago, but have expired?
We really accomplished what we set out to do with the Recovery Act programs, which was to fill the lending gap created by the crisis. We put out $50 billion in loans at a cost to the taxpayers of under $2 billion. Right now our loan levels are back to the pre-recession level. They are, I think, satisfying the market’s credit needs with the loan guarantees that are in place.

In what other ways is the SBA helping small business through these tough times?
We spend a great deal of our energy making sure that small businesses have help in navigating to the outcomes that they want. We have a network of 900 small business development centers. We have 13,000 SCORE mentors. All of which, by the way, is free.

We’ve redone the SBA’s Web site. In a section called SBA Direct a small business can put in [its] zip code and some information (‘I’m interested in government contracts’ or ’I’m a veteran’) and we will feed them the names, addresses, emails of the offices and the counseling operations that are close to them, so they can easily access the specifics of the programs that might apply to them.

What about your recently-announced Impact Fund Program for Michigan, the kickoff to inject $1 billion in capital into small businesses in distressed areas around the country?
In Michigan we’ve created a partnership with a pension fund and Dow Chemical Company to provide up to $130 million in mezzanine loans as growth capital to small businesses. That program will require a zero subsidy from taxpayers, but it has tremendous potential to create value for small businesses. In certain geographies small businesses are not starting up in the numbers that they had been previously. So we’ve allocated $1 billion to invest in small businesses in areas where we can have impact. It’s called the Impact Fund. It’s part of the Obama administration’s Startup America initiative.

If Michigan is No. 1 in the Impact Fund rollout, how will you choose other states?
We are open to and in discussions with many other states. This program works under the framework of our small business investment companies. We ask states and existing mezzanine investment groups to come to us with proposals, and we are hoping, as I said, to do many more similar to this.

Have other states submitted proposals?
Yes, but which ones isn’t public yet.

How about the deficit reduction deal in Congress? How is that going to affect the SBA’s budget and programs?
My understanding is that’s all under discussion. I don’t believe there are across the board or formulas already developed.

SBA’s programs would be among those that might be on the chopping block as part of total cuts of $1.2 trillion if the Super Committee of 12 members of Congress can’t agree on a deficit reduction plan. Isn’t that a threat to your budget?
You need to know that there is tremendous bipartisan support for programs that help small business and, particularly, for those that give a pretty good bang for the buck.