Innovative Financing through CBIA — Financing Alternatives for Small Business

FINANCING ALTERNATIVES THROUGH CONNECTICUT INNOVATIONS

Through our collaboration with Connecticut Innovations (CI), CBIA can help your company access the financing it needs, from $25,000 to $5 million. CI provides equity, debt and bond financing and other forms of financial assistance to companies in all stages of the business life cycle, from startup to later stage. CI offers its portfolio companies strategic guidance and collaborations with partners in business, finance, education, government and nonprofit sectors. CI’s initiatives are designed to grow the state’s economic and technology base, and to stimulate business investments and job creation.

For more information, contact info@ctinnovations.com or call CBIA’s Tom Guerra at 860.244.1160.

DEBT FINANCING

Small Business Loan Guarantee Program - Also known as URBANK, this program can help small and entrepreneurial businesses gain access to financing that would otherwise be unavailable by greatly reducing the risks to the lender. This fast, hassle-free program features automatic enrollment to $500,000 through one of the many banks that participate with CI.

Direct Loans - The direct loan program provides up to $5 million in capital to Connecticut businesses that may not meet conventional lending criteria. With terms up to 20 years, this financing can be used for most general business purposes.

Participation Loans – CI can purchase a participation in a private-sector loan and generally takes a subordinated position to the lender. This expands the bank’s capacity to meet the customer’s borrowing requirements, with pro-rata sharing of interest and no CI fees.

Loan Guarantee Program - Designed to help private-sector lenders meet their clients’ financing requirements, this program guarantees capital provided by a business’s lending partner. The guarantees can fully cover losses up to 40% of the principal balance and can be combined with financing and investments from other public and private sources.

Brownfields Redevelopment Financing – Both CI and its subsidiary, the Connecticut Brownfields Redevelopment Authority (CBRA), can finance the redevelopment of environmentally contaminated industrial and commercial sites. Brownfield projects can be financed through direct, guaranteed and participating loans as well as through the Tax Incremental Financing program.

EQUITY AND RISK CAPITAL INVESTMENTS

TechStart Fund - This fund spurs technology innovation and business formation. It provides capital of $25,000 to startup teams to accelerate the launch of their technology businesses. Supporting the fund is the three-month TechStart Acceleration Program, which provides teams with mentors and professional resources.

Pre-Seed Fund - This fund offers loans of up to $150,000 to assist entrepreneurs in growing early-stage, high-tech companies. A 50% match from private sources is required. The fund is an important catalyst in the state’s high-tech economic development engine, providing support for companies emerging from universities, business incubators and other sources.

Seed Investment Fund - CI’s seed investments address the needs of entrepreneurs as they endeavor to grow Connecticut-based emerging technology companies. Investments of up to $500,000 are structured as equity (preferred stock), convertible debt, or debt with warrants. The fund assists companies at the pre-Series A stage of development.

Eli Whitney Fund - This is CI’s flagship fund. It has provided over $100 million in early-stage funding to some of Connecticut’s fastest growing companies. CI makes equity-based investments of up to $1 million through the fund. Follow-on rounds vary in size and usually include co-investors. CI also provides mentoring, management and marketing guidance.

Venture & Mezzanine Debt Fund - This fund helps growth-stage companies obtain important capital for expansion. The companies should be well positioned to increase revenue and add jobs with the debt funding. Companies must have an existing product that has achieved traction in the market for at least one year and may apply for funding of $300,000 to $2 million.

Connecticut Clean Tech Fund - This fund makes equity investments in Connecticut-based seed and early-stage companies focused on clean tech innovations. A company may receive investments of up to $1.5 million from the fund. “Clean tech” is technology that conserves energy and resources, protects the environment or eliminates harmful waste.

Angel Investor Tax Credit Program – This program allows angel investors to take a credit against Connecticut state income tax for certain investments made in qualifying, emerging technology businesses. Investments must be at least $25,000. The income tax credit equals 25% of the cash investment, up to a maximum credit of $250,000.

SMALL BUSINESS INNOVATION FUNDING

SBIR Acceleration & Commercialization Funding – CI offers matching grants to winners of federal Small Business Innovation Research (SBIR) Phase I awards. CI’s grants help bridge the funding gap between Phase I and subsequent awards. CI also offers commercialization loans to recent winners of SBIR Phase II or other significant federal R&D funding. These loans help accelerate commercialization of new technologies.

Small Business Innovation and Diversification Program – This program provides grants of up to $25,000 to enable Connecticut manufacturers to design and develop innovations that diversify their portfolio of products or markets. Companies must provide a dollar-for-dollar match, maximum of $25,000.

Technology Talent Bridge Program – Designed to cultivate local talent and fuel the growth of the tech sector, this program provides Connecticut university and college students (bachelor degree candidates) – or students who are residents of Connecticut and attend a university outside of Connecticut – mentored internships at small, technology-based businesses in the state. Grants of up to $25,000 per project are available to participating businesses.

UPCOMING EVENTS:

Do Your Systems Need An Upgrade?

Aging computer systems are inefficient, expensive to operate, and difficult to support. An upgrade can help your company become more efficient—and more competitive. Join us Wednesday, June 5, 2013, at 10:00 a.m. for a free, 45-minute, interactive webinar by Connecticut Innovations, in which you’ll learn:

• Why updating your systems is so important

• How to access our flexible information technology and cyber security loans and borrow up to $750,000

• How to upgrade without tapping into working capital, and

• Other financing available through Connecticut Innovations