Mississippi Gets $86M to Boost Small Businesses and Startups
Aug 11, 2023
by: Joshua Wilson, Mississippi Business Journal
The Mississippi Development Authority, the state’s lead community and economic development agency, will receive up to $86 million in federal funds to support small businesses and startups.
The money comes from the State Small Business Credit Initiative, which was reauthorized and expanded as part of the American Rescue Plan Act of 2021. The funds are disbursed by the U.S. Treasury Department.
The state agency will use its slice of the federal funds to support four programs, including a loan guarantee program, a loan participation program, and two equity and venture capital programs.
The $15 million loan guarantee program’s goal is to expand access to capital for underserved small businesses. It will guarantee loans up to 80%.
The loan participation program has been allocated $45 million. It will provide funds in the form of a loan to community development financial institutions, which are lenders with a mission to provide fair and responsible financing to rural and urban communities. Its goal is to increase access to capital for small businesses and promote economic growth and job creation.
The Mississippi Venture Capital Program, which received $15 million, will invest in venture capital funds that support startups. The program, administered by Innovate Mississippi, aims to attract and retain high-growth businesses.
The Direct Program has a budget of $15 million and will focus on startups in the pre-seed, seed and Series A stages of initial funding. The program will not serve as the lead investor and requires a lead investor’s participation in a funding round. Depending on their size, deals can receive program-provided matches of up to $1 million.
“The SSBCI will provide critical funding to support Mississippi small businesses and startups, and we are thrilled to see these programs become a reality,” said Laura Hipp, deputy executive director of the state development agency. “By investing in these Mississippi companies, we will generate new job opportunities and spur even more economic growth in communities throughout our state.”