State Small Business Credit Initiative Program to Establish Venture Capital Investment and Small Business Loans
Vermont Business Magazine Governor Phil Scott, the Agency of Commerce and Community Development (ACCD) and the Vermont Economic Development Authority (VEDA) today announced that Vermont will receive $57.9 million in federal American Rescue Plan Act (ARPA) funding to provide more access to capital for Vermont entrepreneurs and small business startups. Vermont's State Small Business Credit Initiative (SSBCI) program will include access to low interest loans and early-stage venture capital investments.
"My administration remains focused on retaining and creating jobs and supporting businesses in every region of the state,” said Governor Scott. “This program will support our innovative employers, helping them to grow and become national leaders while strengthening our communities here at home.”
Established in 2010 and reauthorized in 2021 under ARPA, $10 billion in SSBCI funding has been distributed to states, the District of Columbia, territories, and tribal governments to expand access to capital for small businesses emerging from the pandemic with a focus on creating high-quality jobs and expanding economic opportunity in underserved communities lacking capital.
“This is an historic investment in entrepreneurship, small business growth, and innovation through the American Rescue Plan that will help reduce barriers to capital access for traditionally underserved communities,” said Secretary of the Treasury Janet L. Yellen. “I’m excited to see how SSBCI funds will promote equitable economic growth across the country.”
Vermont’s SSBCI program will receive nearly $29 million allocated to venture capital that will focus on seed fund investments; leveraging accelerator programs to make small investments in rural, pre-seed stage companies; and investments in high-growth, technology innovation companies in the healthcare sector.
“Never before have we had such an opportunity to fund startups and early-stage capital for Vermont companies,” said Department of Economic Development Commissioner Joan Goldstein. “These investments present an enormous opportunity for venture capital in the state.”
Vermont will also allocate another $29 million to a loan participation program, administered by VEDA, which will leverage private funds to help small businesses grow, create good paying jobs and serve underserved markets.
“The COVID-19 pandemic devastated many of our businesses, farmers and entrepreneurs,” said VEDA Chief Executive Officer Cassie Polhemus. “Receiving this federal funding will go a very long way in supporting VEDA’s mission of strengthening Vermont’s economic vitality by leveraging private funds to catalyze innovation in key sectors, creating high quality jobs, diversifying the economy, and helping businesses continue to recover from the pandemic.”
Senator Patrick Leahy (D-Vermont), Chair of the Senate Appropriations Committee, is hailing the U.S. Treasury Department’s action to approve Vermont’s plan on how the state will use Vermont’s SSBCI funds. He released this statement on the news announced by the Treasury Department on Monday afternoon:
“I am delighted to see the Treasury approve Vermont’s plan to support underserved entrepreneurs and small business growth through the SSBCI program. As Chair of Senate Appropriations, reviving the SSBCI program was a priority of mine while working on the American Rescue Plan Act last year. There is a desperate need for venture capital in Vermont to give small businesses and entrepreneurs the opportunity to be able to start and grow a business in our great state. Rural states, like Vermont, lack professionally invested early-stage equity and near equity investors to prepare and launch new companies and research commercialization. These SSBCI funds will give Vermont the tools necessary to support business development and emerging companies statewide that currently lack access venture capital and critical lending programs.”
As Chair of Senate Appropriations Committee, Leahy fought for the inclusion of $10 billion for Treasury for SSBCI and an all-state minimum allocation for the program in the American Rescue Plan Act. Vermont has been among the lowest recipients in the United States of venture capital on a per capita basis.
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Governor. Montpelier. 7.18.2022. www.vermont.gov