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Seed & Venture Capital Resource Center

Seed and venture capital programs exist throughout the country. While the public sector may help to initiate such programs, they are largely operated by the private sector. Economic development practitioners can help to foster economic activity by steering new companies, entrepreneurs and start-ups towards venture capital and private equity firms in their states or communities. This type of funding is critical in providing capital for emerging businesses.


Seed capital is an initial capital investment into a new business venture or product line. Often, this capital allows an entrepreneur to launch a new venture without drawing upon traditional lending sources. As a general rule, seed capital is provided by private investors in exchange for a high rate of return on their investment. Seed capital recipients are typically businesses or entrepreneurs with less than one year of history. In most cases, they have not yet produced a commercial product or service. Investors often seek an equity or ownership position in the new company. This represents a considerable tradeoff, as the entrepreneur must cede an ownership interest or pay an unusually high rate of return in order to gain access to capital.


Venture capitalists are financiers that take a role in the management of young, growing companies. Venture capital firms are generally private partnerships or corporations funded by private and public pension funds, endowment funds, foundations, corporations, individuals and foreign investors. Venture capital is different from seed capital because venture capital firms typically do not invest in companies until they are somewhat established. Venture capitalists often play a hands-on role in the management of a new, growing company, and may also assist with product development. They typically take a high risk in anticipation of a relatively higher rate of return over a period of time.


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-Understanding Seed & Venture Capital

Interested in learning about financing small business? This section contains resources on understanding the basics of Seed & Venture Capital.

Access to Capital and Credit in Native CommunitiesMembers only Login
This document, “Access to Capital and Credit in Native Communities: A Data Review” (Data Review) begins to answer the questions: Where does Native America stand now in terms of capital and credit access? What has been the effect of new action and new approaches by policymakers and financial entrepreneurs? What are Native Communities’ ongoing and future capital and needs?
State Strategies to Help Businesses Launch and ExpandMembers only Login
This report, produced by The PEW Charitable Trusts, examines how state governments can find solutions to policies that undermine opportunities for investment and job creation when businesses spend too much time or money on inefficient regulatory processes, or when new business projects get delayed because firms don’t understand how to comply with the rules.
Strengthening Access to Capital ProgramsMembers only Login
Vincent DiCara, Owner of DiCara Training and Consulting, LLC, discusses access to capital and the benefits of leveraging public sector support for even greater private sector investment and explore a variety of programs available in the region.
Unlocking Capital AccessMembers only Login
Representatives from the California Association of Micro Enterprise Opportunity and California Pollution Control Financing Authority look at how California creates access to capital for micro businesses and enterprises.
Access to Capital for Small, Middle Market CompaniesMembers only Login
Gene King of Sequence Holdings LLC, discusses in detail various capital access methods and structures for small and middle market companies.

-Resources

View all Access to Capital Resources

-Angel Investment

Bread and Butter Farm Case StudyMembers only Login
How Bread and Butter Farm worked with a patchwork quilt of financing sources to keep land conserved for agriculture.
New Funding Sources for Food-Related BusinessesMembers only Login
This directory provides an overview of various sources of financing that may be available to food hubs and other food-related businesses. This directory is a partial listing of what may be available across the United States; some examples may not be a good match with your particular circumstances. Many of the funding sources listed in this directory are available for local food-related businesses across the United States, but several additional funding websites are specifically for Michigan.
Angel Investment Tax Credits in Illinois and ElsewhereMembers only Login
Adam Blair with the Economic Development Research Group discusses Illinois’ extension of the angel investment tax credit and how it compares with similar programs in other states that compete for angel investment
Access to Capital Strategies for AgricultureMembers only Login
Tim Crosby explores the most innovative and effective access to capital tools used for agriculture-based business, including loan funds and federal and state programs.
Angel Investment Tax CreditsMembers only Login
Catherine Renaul of Innovation Policyworks LLC, provides research and analysis on using angel investment tax credits to incentivize investors.
View More Angel Investment Resources

-Seed Capital

One Linden - Comprehensive Community Development PlanMembers only Login
Linden is a distressed neighborhood in Columbus, Ohio. This plan is designed to create a roadmap for safe neighborhoods, economic development and access to affordable housing, quality healthcare, education and employment opportunities in Linden.
CDFA // BNY Mellon Webcast Series: Strategies to Support Your Local Venture Capital EcosystemMembers only Login
During this installment of the CDFA // BNY Mellon Webcast Series, Lamont Price with the Tennessee Department of Economic and Community Development, Teela Spiller with the Atlanta Micro Fund, and Eric Clement with the NYCEDC highlighted several development finance programs that have proven effective in attracting venture and start-up capital.
New Funding Sources for Food-Related BusinessesMembers only Login
This directory provides an overview of various sources of financing that may be available to food hubs and other food-related businesses. This directory is a partial listing of what may be available across the United States; some examples may not be a good match with your particular circumstances. Many of the funding sources listed in this directory are available for local food-related businesses across the United States, but several additional funding websites are specifically for Michigan.
Evaluation of SSBCI ProgramMembers only Login
This report summarizes the outcomes of 142 state credit support and investment programs funded by the State Small Business Credit Initiative (SSBCI), which supported over $8 billion in new lending and investing to small businesses since 2011. The report studies program activity based on data reported to Treasury on 16,919 transactions made between 2011 and 2015, and interviews of state program managers and their partners.
View More Seed Capital Resources

-Venture Capital

CDFA // BNY Mellon Webcast Series: Strategies to Support Your Local Venture Capital EcosystemMembers only Login
During this installment of the CDFA // BNY Mellon Webcast Series, Lamont Price with the Tennessee Department of Economic and Community Development, Teela Spiller with the Atlanta Micro Fund, and Eric Clement with the NYCEDC highlighted several development finance programs that have proven effective in attracting venture and start-up capital.
Bread and Butter Farm Case StudyMembers only Login
How Bread and Butter Farm worked with a patchwork quilt of financing sources to keep land conserved for agriculture.
New Funding Sources for Food-Related BusinessesMembers only Login
This directory provides an overview of various sources of financing that may be available to food hubs and other food-related businesses. This directory is a partial listing of what may be available across the United States; some examples may not be a good match with your particular circumstances. Many of the funding sources listed in this directory are available for local food-related businesses across the United States, but several additional funding websites are specifically for Michigan.
Evaluation of SSBCI ProgramMembers only Login
This report summarizes the outcomes of 142 state credit support and investment programs funded by the State Small Business Credit Initiative (SSBCI), which supported over $8 billion in new lending and investing to small businesses since 2011. The report studies program activity based on data reported to Treasury on 16,919 transactions made between 2011 and 2015, and interviews of state program managers and their partners.
CDFA // BNY Mellon Webcast Series: Capturing the Success of High Performing DFA'sMembers only Login
This month’s CDFA // BNY Mellon Development Finance Webcast Series on Capturing the Success of High Performing DFA's featured Tim Fisher of CDFA, Paul Toth of Toledo-Lucas County Port Authority, Gary Smith of Chester County Economic Development Council, Samuele Bozzolla of Allegheny County, and Juan Salgado of Phoenix Industrial Development Authority.
View More Venture Capital Resources

-State Capital Access Programs

Available CFA Resources - New York Regional Economic Development CouncilsMembers only Login
In 2011, Governor Cuomo created ten Regional Economic Development Councils (REDC) and the Consolidated Funding Application (CFA) to advance the administration’s efforts to improve New York’s business climate and expand economic growth. This 2019 document outlines information about each agency’s grant programs, including eligibility, scoring criteria, applicant requirements, and agency contact information.
State Strategies to Help Businesses Launch and ExpandMembers only Login
This report, produced by The PEW Charitable Trusts, examines how state governments can find solutions to policies that undermine opportunities for investment and job creation when businesses spend too much time or money on inefficient regulatory processes, or when new business projects get delayed because firms don’t understand how to comply with the rules.
State and Federal Development Finance ProgramsMembers only Login
Industry experts from around the state and from various federal agencies will discuss development finance programs and their potential to spur job creation and growth in the economic development industry.
Evaluation of SSBCI ProgramMembers only Login
This report summarizes the outcomes of 142 state credit support and investment programs funded by the State Small Business Credit Initiative (SSBCI), which supported over $8 billion in new lending and investing to small businesses since 2011. The report studies program activity based on data reported to Treasury on 16,919 transactions made between 2011 and 2015, and interviews of state program managers and their partners.
Small Business Access to CapitalMembers only Login
Allen McConnell (Ohio Development Services Agency) discusses how small businesses are financed, the various access to capital challenges they face, and the most innovative and effective access to capital tools available in Ohio.
View more State Capital Access Program Resources

-Loan Guarantees

Illinois Finance Authority's Participation Loan ProgramMembers only Login
Stan Luboff with the Illinois Finance Authority discusses IFA's new participation loan program.
FY2017 Capital Magnet Fund Awards Members only Login
The fiscal year (FY) 2017 award round is the third round in the Capital Magnet Fund’s history. 40 organizations received $120 million in awards including 52 loan funds, 7 banks/thrifts, 3 credit unions, 2 depository institution holding companies, and 1 venture capital fund.
Strengthening Access to Capital ProgramsMembers only Login
Vincent DiCara, Owner of DiCara Training and Consulting, LLC, discusses access to capital and the benefits of leveraging public sector support for even greater private sector investment and explore a variety of programs available in the region.
Strengthening Access to Capital ProgramsMembers only Login
James Key-Wallace, Executive Director at New Hampshire Business Finance Authority, discusses access to capital and the benefits of leveraging public sector support for even greater private sector investment and explore a variety of programs available in the region.
The Federal RRIF Loan ProgramMembers only Login
This report by Richard Sherman of The Seneca Group LLC provides an overview of the federal Railroad Rehabilitation & Improvement Financing (RRIF) loan program. The document reviews the purpose of and application process for the program and also provides several case studies of past projects.
View more Loan Guarantee Resources

-Microenterprise & Microloans

Strengthening Access to Capital ProgramsMembers only Login
James Key-Wallace, Executive Director at New Hampshire Business Finance Authority, discusses access to capital and the benefits of leveraging public sector support for even greater private sector investment and explore a variety of programs available in the region.
Microenterprise Lending: A Cookbook for Mutual SuccessMembers only Login
This guide by ISED Solutions and the U.S. Office of Refugee Resettlement discusses the difficulties of microlending and lending to refugees and immigrants. Use this as a guide to find inspiration in developing your own recipe for microenterprise lending – one that the consumer will use and appreciate in building a new life in the United States.
Small Business Financing Solutions - WWBICMembers only Login
Wendy Baumann (WWBIC) discusses how small businesses are financed and the various access to capital challenges they face. Baumann discusses WWBIC's services: business and financial education programming, micro and small business loans, one-on-one business technical assistance, and financial capability programs.
An Overview of Development Finance Programs in California's Treasurer's OfficeMembers only Login
Jeree Glasser-Hendrick of the California Debt Limit Allocation Committee provides an in-depth look at the wide range of development fiance resources available through the California State Treasurer's Office.
Unlocking Capital AccessMembers only Login
Representatives from the California Association of Micro Enterprise Opportunity and California Pollution Control Financing Authority look at how California creates access to capital for micro businesses and enterprises.
View more Microenterprise & Microloan Resources

-Programs Map

Search the map below for small business finance programs by state. This specialized search is part of CDFA's State Financing Program Directory, the only online resource cataloging the development finance programs offered by state governments. Click on a state to see a sample of state small business finance programs available. Login with a CDFA Member account at the top of the page to view full results.

-Case Studies

One Linden - Comprehensive Community Development PlanMembers only Login
Linden is a distressed neighborhood in Columbus, Ohio. This plan is designed to create a roadmap for safe neighborhoods, economic development and access to affordable housing, quality healthcare, education and employment opportunities in Linden.
Idaho Economic Development Association Summer 2019 ReportMembers only Login
This summer 2019 performance report from the Idaho Economic Development Association discusses economic development in Idaho and offers several case studies.
Fact Sheet on Farm Credit System Farmer Lending Results for 2018 Members only Login
This information summarizes Farm Credit System 2018 lending activity to young, beginning, and small (YBS) farmers, ranchers, and producers or harvesters of aquatic products. For total System loans, the number of new loans made in 2018 declined by 21.4% compared with 2017. The number of loans to young farmers declined by 17.7%, to beginning farmers by 15.5%, and to small farmers by 16.1%.
Fair Food Fund 5 Year Impact ReportMembers only Login
The Fair Food Fund was designed to meet these entrepreneurs where they are and take them where they want to go. Since 2013, we have invested more than $3 million in 13 food businesses. Just as important is supporting these businesses on the road to profitability; that’s why we’ve also invested more than $700,000 in business assistance, offering more than 70 enterprises solutions that range from multi-day intensive trainings to customized one-on-one support.
Agricultural Lending: Credit to Socially Disadvantaged Farmers and Ranchers Is LimitedMembers only Login
Can women and minorities get the loans they need to buy and operate farms? According to USDA survey data, these "socially disadvantaged" farmers and ranchers get a disproportionately small share of farm loans. More detailed information isn’t available on farm lending to these groups because lenders generally aren't allowed to record an applicant's race or sex.
View More Case Studies

-Headlines

-Publications

Innovation Finance Reference Guide
The Innovation Finance Reference Guide explores the growing seed, venture capital and angel investment industry. Written by Robert Heard of Cimarron Capital Partners and Jim Troxel of Development Capital Networks, this guide gives development finance agencies a roadmap for building an innovation finance initiative that supports entrepreneurship, business investment, job creation, and 21st century technology development.
Practitioner's Guide to Economic Development Finance
The Practitioner's Guide to Economic Development Finance 2nd Edition is the only comprehensive resource dedicated to building and utilizing the development finance toolbox. The Practitioner's Guide provides the insight and practical information needed to critically understand how economic development is financed and the tools, strategies and techniques used to build strong communities. From bonds, tax increment finance and special districts to tax credits, seed & venture capital, revolving loan funds and much more, this Guide outlines the financing tools required for succeeding in today's competitive economic development climate.
Unlocking Capital: A Handbook for Becoming a High Performing Development Finance Agency
Unlocking Capital: A Handbook for Becoming a High Performing Development Finance Agency (Handbook) serves as a companion to the Practitioner’s Guide to help illuminate the structures of development finance agencies (DFAs), essential conduits to access development finance tools. The Handbook provides an overview of DFAs and their myriad roles in various development efforts. Included in this discussion is a comprehensive look at over a dozen high-performing DFAs throughout the country. The Handbook is designed to be a starting point for local leaders to engage in the creation or acceleration of a DFA to build and utilize the development finance toolbox.
View More Publications

-Training Courses

The CDFA Seed & Venture Capital Finance Course explores the growing seed, venture capital and angel investment industry and provides clear direction for designing and implementing capital formation models at the local, regional, and state levels. This course differs from other capital formation curriculums in that it focuses more concretely on designing a program that uses public-sector connections, resources and coordination to drive long-term and sustainable private-sector investment.

View All Courses

-Upcoming Events

Fundamentals of Economic Development Finance WebCourse
January 29-30, 2020
Daily: 12:00 - 5:00 PM Eastern
The Fundamentals WebCourse is the foundation for all of CDFA’s educational offerings. This course helps attendees understand the variety of development finance tools available, from bonds, tax credits and TIF, to federal financing programs, RLFs, and access to capital lending resources.
Register
CDFA Federal Policy Conference
April 14-15, 2020
Washington, DC
The federal government plays a critical role in driving private and public investment in innovation, job creation, infrastructure, and community development. With the 2020 presidential election quickly approaching, development finance will be a key policy issue across the nation. The 116th Congress will also play a major role in shaping our country’s economic development policy going forward. It's up to the development finance community to focus the national discussion on smart federal policy, and CDFA is the voice of the economic development finance community on Capitol Hill. For these reasons, CDFA will host its CDFA Federal Policy Conference on April 14-15 in Washington DC.
Register
View more Upcoming Events

-Webcasts

CDFA // BNY Mellon Webcast Series: Strategies to Support Your Local Venture Capital EcosystemMembers only Login
During this installment of the CDFA // BNY Mellon Webcast Series, Lamont Price with the Tennessee Department of Economic and Community Development, Teela Spiller with the Atlanta Micro Fund, and Eric Clement with the NYCEDC highlighted several development finance programs that have proven effective in attracting venture and start-up capital.
CDFA // BNY Mellon Webcast Series: Bridge Financing Solutions for Spurring DevelopmentMembers only Login
How can bridge lending become a dynamic part of a project's capital stack? During this installment of the CDFA // BNY Mellon Development Finance Webcast, Brett Doney with Great Falls Montana Development Authority and Terry Hegle with Business Oregon discussed effective bridge lending techniques and how they can sustain a project through its challenging initial phases to successful completion.
CDFA // BNY Mellon Webcast Series: Crowdfunding Small Business DevelopmentMembers only Login
Crowdsourcing.org defines crowdfunding as “the use of small amounts of capital from a large number of individuals to finance a new business venture.” This financing mechanism has become immensely popular with entrepreneurs and small businesses as can be seen by the growth of websites such as GoFundMe and Kickstarter. States across the nation are adopting legislation to support this new style of finance. Some states have even partnered with crowdfunding providers or offered grant programs to encourage its use. During this installment of the CDFA // BNY Mellon Development Finance Webcast Series Diane Wolverton and Kim Vincent from The Local Crowd, LLC, Trey Sherwood from the Laramie Main Street Alliance and Katharine Czarnecki from the Michigan Economic Development Corporation present on the approaches their communities are taking to support crowdfunding.
CDFA-Stifel Webcast: Food Systems Investments Driving New MarketsMembers only Login
The third installment of the CDFA-Stifel Rural Community Development Finance Solutions Webcast Series focused on how food systems investments can be used to drive other markets, benefitting the economy of small and rural towns throughout America.
View More Webcasts

CDFA National Sponsors

  • Alaska Industrial Development and Export Authority
  • Baker Tilly Virchow Krause
  • BNY Mellon
  • Bricker & Eckler LLP
  • Bryan Cave Leighton Paisner LLP
  • Business Oregon
  • CohnReznick
  • FBT Project Finance Advisors LLC
  • Fifth Third Bank
  • Frost Brown Todd, LLC
  • Hawkins Delafield & Wood LLP
  • Ice Miller LLP
  • KeyBanc Capital Markets
  • Kutak Rock LLP
  • McCarter & English, LLP
  • McGuireWoods
  • MuniCap, Inc.
  • NW Financial Group, LLC
  • Petros PACE Finance
  • SB Friedman Development Advisors
  • Stern Brothers
  • Stifel Nicolaus
  • U.S. Bank
  • Wells Fargo Securities
  • Wilmington Trust
  • Z. The Bond Buyer
Become a Sponsor