October 12, 2022
For more information, contact:
Stacey Hupp Ballard, Iowa Economic Development Authority
515.348.6245
communications@iowaeda.com
IEDA announced a $96 million investment in Iowa small businesses and entrepreneurs
October 12, 2022DES MOINES, IA) – The Iowa Economic Development Authority (IEDA) today announced a $96 million investment in growing small businesses in Iowa, including startups, manufacturers and businesses owned by veterans and individuals from diverse backgrounds. The funding comes from the US Treasury Department’s State Small Business Credit Initiative (SSBCI), a small business assistance program expanded through the federal America’s Rescue Plan Act.
A program created in the 2021 legislative session to strengthen Iowa’s food supply chain and support rural development was renewed by successful lawmakers in the 2022 session. Grants of up to $100,000 are available to eligible businesses, with a total of $1,000,000 available through the program each fiscal year.
“Small businesses and entrepreneurs dream big, drive Iowa’s economy and make our communities better places to live,” said Governor Kim Reynolds. “Iowa has experienced a rapid economic recovery from the pandemic because of the creativity and resilience of our small businesses. This funding builds on that momentum by investing in our small businesses and entrepreneurs, just as they choose to invest in Iowans.”
The Treasury Department approved the Iowa rate based on the plan submitted by IEDA. Iowa SSBCI dollars focus on encouraging venture capital and investments through the following programs:
- 4.0 Loan participation program for producing investments: $28 million to help Iowa manufacturers invest in new technologies that are changing the industry. The state buys back a portion of the loan to offset the risk to lenders.
- Small Business Bond Assistance Program: $15 million to offset collateral shortfalls when small businesses receive loans through commercial lenders. Eligible borrowers include 51% of women-owned small businesses, individuals of diverse races, veterans, people with disabilities, and long-term rural residents; and small businesses that enhance arts and culture in Iowa.
- Venture Capital Innovation Fund Program: $22 million to increase funding opportunities in the state’s grant programs for entrepreneurs. This fund provides additional financial support to address gaps in the early stages of development as businesses conceptualize, launch and scale.
- Venture Capital Mutual Fund Program: $31 million to make equity investments in private companies and ensure that investments are qualified.
“Iowa’s small businesses have faced some big economic challenges over the past few years, but they have some great success stories and we’ve seen two years in a row of record breaking new businesses,” he said. “Our team looks forward to working with our small business and innovation partners to bring these innovative efforts to life,” said Debbie Durham, executive director of IEDA and the Iowa Finance Authority.
SSBCI was established in 2010 to increase access to capital for traditionally underserved small businesses and entrepreneurs. As businesses recovered from the pandemic, it was reauthorized and expanded through the US Rescue Plan to build on that success.
Planning for SSBCI application process is underway. For more information, visit iowaeda.com/ssbci.
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