The Indiana Economic Development Corporation wins massive federal grant to help entrepreneurs and startups. (Courtesy Indiana Department of Labor.)
The Indiana Economic Development Corporation wins massive federal grant to help entrepreneurs and startups. (Courtesy Indiana Department of Labor.)

The Indiana Economic Development Corporation won up to $99.1 million in federal funding through the State Small Business Credit Initiative to expand access to and increase capital for Hoosier entrepreneurs, startups and small businesses.

“As a state, Indiana is strategically focused on creating the economy of the future and investing in the jobs of tomorrow and taking Indiana’s Top 40 Global Entrepreneurship Ecosystem to a Top 5 Ecosystem is an essential goal of that initiative,” said Indiana Secretary of Commerce Brad Chambers. “This SSBCI award will inject critical funding and resources into our ecosystem of current and future entrepreneurs, startups and small businesses who are solving global challenges, creating new technologies, and positively impacting Hoosier communities statewide.”

Indiana is one of the first 14 states and territories to be approved by the U.S. Department of Treasury for this iteration of SSBCI, a program established in 2010 and reauthorized and funded through The American Rescue Plan Act in 2021. This federal funding, which must be disbursed alongside private dollars, is expected to leverage $10 in follow-on investment for each $1 of SSBCI, providing entrepreneurs and small business owners the resources they need to grow and resulting in at least $990 million invested in Indiana’s innovation and entrepreneurial ecosystem by the end of the SSBCI program.

Indiana will receive a minimum of $86 million and will be eligible to receive another $13 million – for a total of $99 million over 10 years – when the state meets expected targets for the initial allocation. Indiana will leverage SSBCI to expand venture capital investments and create a new program to invest in small business loan funds throughout the state. At least 37% of this funding will be allocated to traditionally underserved small businesses and entrepreneurs, encouraging greater equity in access to capital for Hoosier businesses.

About $70 million of the state’s funding will be used to accelerate Indiana’s innovative startup ecosystem through direct investments in early-revenue companies. This allocation will significantly expand Indiana’s ability to support pre-seed and seed funding rounds through Elevate Ventures, Indiana’s venture development partner, increasing access to working capital for innovators, entrepreneurs and startups.

This allocation will be invested in Indiana-based companies through the Indiana Angel Network Fund alongside co-investors, with a strategic effort to participate in early funding rounds led by venture capital partners strategically focused on reaching underrepresented founders.

The IEDC will leverage $28 million of the funding to create a new small business loan fund investment program to provide more capital for entrepreneurs and small businesses, particularly for those that have been historically underserved. Through the program, loan funds that provide debt capital for qualified purposes to Indiana-based small businesses will be eligible to have a portion of those loans purchased by the IEDC, enabling the loan funds to then support more entrepreneurs and small businesses.

The remaining SSBCI funds will be used to support administrative costs related to supporting entrepreneurs, startups and small businesses through these initiatives and accelerating venture, debt and working capital to Indiana-based companies, cultivating and diversifying the state’s robust innovation and entrepreneurial ecosystem.

© Indiana Capital Chronicle, 2022 The Indiana Capital Chronicle is an independent, nonprofit news organization dedicated to giving Hoosiers a comprehensive look inside state government, policy and elections. The site combines daily coverage with in-depth scrutiny, political awareness and insightful commentary.