NetWork Kansas Funding Programs: StartUp Kansas and Entrepreneurship Community Continue Growth
In difficult economic times, funding programs that serve to provide additional risk capital to entrepreneurs in startup and existing businesses in expansion become even more vital. This is evident by the continued acceleration of two NetWork Kansas funding programs, StartUp Kansas and the Entrepreneurship (E) Community Partnership.
StartUp Kansas and E-Communities provide funding for startups and expansions of existing businesses in rural and distressed Kansas communities in the form of matching grants and unsecured loans. StartUp Kansas is a statewide funding program while E-Communities provide funds in specific communities and counties throughout Kansas. Specific requirements include the following:
1. NetWork Kansas partners administer the loan and provide a minimum of 40% matching funds.
2. Selections are based upon the following criteria: a.) The business has the potential to be an economic driver. This is a business the committee believes that, if successful, has the ability to grow and create additional jobs. Also, it may have the capability of generating wealth from outside of the community. (Manufacturer, etc.) b.) The business provides a community benefit. It provides a benefit that the community perceives as either a necessity or enhances the community in another way. (Service businesses, restaurants, local newspapers, etc.) In these cases, the community benefit is weighted more heavily than job creation.
3. One important innovation for both programs is that there are no collateral requirements for StartUp Kansas and E-Community funds. A primary emphasis is that these funds are a component of funding that is at the end of the entrepreneur's capital food chain to ensure we do not replace private capital. Often, StartUp Kansas and E-Community funds serve as the final portion of a loan that is needed by the business but cannot be collateralized. This is often a significant challenge for businesses in rural and distressed areas. In many cases, StartUp Kansas and E-Community funds represent capital that would otherwise be unavailable to the business but is critical to the operation.
Results Since Inception
StartUp Kansas was launched in August of 2006 while the E-Community partnership provided its first funding in April of 2008. Here are some early indicators of success (as of April 30, 2009):
• Combined, StartUp Kansas and E-Communities have provided more than $1.6 million to 68 businesses. These funds represent less than 12% of the total capital secured.
• Those 68 businesses have leveraged more than $12.5 million in additional capital.
• Since inception, these businesses have created or retained more than 700 full- and part-time jobs
• 65% of the businesses funded were in communities with a population of less than 5,000 and almost half of the 65% were in communities with a population of less than 1,000.
Other Things We Know
In addition to the information above, we also know the following:
• Kansas rural entrepreneurs can still compete in the manufacturing sector, as 30% of the businesses funded were some type of manufacturer.
• Service and retail continue to be an important component of building social capital in rural communities.
• Women entrepreneurs continue to be an important component of businesses and jobs created as they represent 25% of the businesses funded.
Conclusion
Businesses continue to start and expand in rural Kansas. StartUp Kansas and the E-Community partnership will continue to explore innovate methods to help local businesses succeed. In addition, communities must continue to become more entrepreneurial by ensuring that local businesses are connected to the education, expertise, and economic resources that are available.
Who Can Apply and How?
Entrepreneurs and existing businesses must work with their local or regional non-profit business support providers who are NetWork Kansas partners. Examples are the regional foundations, Kansas Mainstreet organizations, city and county microloan programs, certified development companies, economic development agencies, and other non-profit organizations that provide funding to for-profit entrepreneurs and small businesses in Kansas.
If you are an entrepreneur or existing business owner in one of the communities listed below, click on the appropriate tab to find out the following information.
1. E-Community Local Contact.
2. Application Process for Applying for E-Community funds.
3. NetWork Kansas resource partners in each area that can assist with business plan development, incentives for business expansion, and funding partners.