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Margaret Somer, Regional Director Small Business Development Center, Northeast Mass Salem State College. Massachusetts Small Business Development Center Network www.msbdc.org. Small Business Development Centers Central MA SBDC - Clark University - Worcester
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Margaret Somer, Regional Director Small Business Development Center, Northeast Mass Salem State College
Massachusetts Small Business Development Center Network www.msbdc.org Small Business Development Centers Central MA SBDC - Clark University - Worcester Northeast MA SBDC - Salem State College Southeastern MA Regional SBDC – Fall River UMass Boston SBDC - Boston Western MA Regional SBDC - Springfield Berkshires SBDC – Pittsfield PTAC– Government Contracting Mass Export Center Network funding & key partners U.S. Small Business Administration MA Dept. of Business & Technology UMass Amherst and other institutions
GOVERNMENT FINANCING FOR BUSINESS Why does government provide business financing and services? • To stimulate technological & scientific innovation and the development of new products that government seeks, (SBIR R&D grants for new products in defense, environmental contamination…) • To generate economic activity, jobs and business opportunities • To promote and retain employment and upgrade workforce skills, (Massachusetts Workforce Investment Fund…)
GOVERNMENT FINANCING… • To create new financing models for the private sector to adopt (MTDC’s financing of early stage technology companies in the ‘70s; minority business financing; affordable housing in the ‘80s, …) • To support projects with significant economic impact (ATMP – Advanced Technology & Manufacturing Ctr. in Fall River; Devens, a former MA military base located in four towns; Enterprise Center in Salem) • To leverage and stimulate private sector investment (SBA loan guarantees, quasi-public financing..)
FEDERAL GOVERNMENT – BUSINESS FINANCING • U.S. Small Business Administration – www.sba.gov • SBA Loan Guarantees • SBA 504 Program – acquisition of property equipment, etc. (the business finances 10%) • Disaster Loans • Export loans • SBIR - Small Business Innovation Research Grants • STTR – Small Business Technology Transfer Grants
SBIR - Small Business Innovation Research Grants • 2.5% set aside from federal agencies since 1982 • Stimulate technical innovation in small business communities to meet federal R&D needs – and commercial potential • PI must be employed by small business STTR – Small Business Technology Transfer • Stimulate scientific and technological innovation through cooperative R&D carried out by small businesses and research institutions. • Foster technology transfer between small businesses and research institutions. • PI may be employed by small business or research partner.
SBIR / STTR – 3-Phase Program • Phase 1: • Up to $100K and 6-12 month award - Feasibility study • Phase 2: • Up to $750K and 2-year award • Full research / R&D • “Phase” 3: • Commercialization stage • Company raises funds on its own
SBIR - Small Business Innovation Research Grants • Who participates? 66% have 2-24 employees. SBIR / STTR – Criteria – Phases 1 and 2 • Strength of scientific/technical aspect of work • Ability to carry out project in cost-effective manner • Project or commercial impact on US economy • Evidence of commercial potential (Phase 2)
SBIR / STTR Resources • www.sbirworld.com • www.pnl.gov/edo/sbir • Individual agency websites • SBIR newsletters and email lists • SBIR conferences and workshops
MASSACHUSETTS QUASI-PUBLIC LENDERS & INVESTORS • Mass Technology Development Corp. – MTDC • Mass Technology Collaborative • MassDevelopment – Funds such as Emerging Technology Fund for tech-based manufacturing facilities & equipment • The Business Development Company • MA Community Development Finance Corp. – CDFC
MASSACHUSETTS QUASI-PUBLIC LENDERS & INVESTORS • MCRC - MA Capital Resource Company • MCRC’s Life Insurance Initiative – capital for economic development • Property & Casualty (Insurance) Initiative – Community Development Initiative • MA Economic Stabilization Trust - manufacturing
MASSACHUSETTS QUASI-PUBLIC LENDERS & INVESTORS – (and many more focused on later stage companies) Mass Technology Development Corp. - www.mtdc.com • Equity & sub debt for early stage technology companies since 1982 • Usually $250-$500K • Jobs – leverage – technical innovation – nurture entrepreneurship Mass Technology Collaborative - www.mtpc.org • Debt/equity for renewable energy technology firms Massachusetts Workforce Training Fund - www.detma.org/workforce • Matching grants for workforce development
CITIES, MICROLOAN FUNDS, NON-PROFITS • Debt and microloans for gap, business and project financing • Business incubators with a range of services and networks (ATMP, Enterprise Center at Salem State College) • Loan Funds: City of Lynn, MA • Microloans up to $35,000 • Term loans up to $350,000 • Loans up to $3 million for major development projects
Other Interesting Resources… • Circle Lending –www.circlelending.com • Manages lending among family and friends - • MA Alliance for Economic Development-www.massecon.com • Assistance with site location
Margaret Somer, Regional Director Small Business Development Center (SBDC) Northeast Region - Salem State College 121 Loring Ave., Suite 310 Salem, MA 01970 Tel. 978-542-6343, x. 1 msomer@salemstate.edu www.salemstate.edu/sbdc