A Startup’s Dream Come True
In January, tax legislation dominated the country’s focus, overshadowing a program that might be just what the biorefining industry has been looking for. Spurred on by the current administration’s commitment to developing a U.S. clean technology industry that is second to none, the Startup America program was born. Touting its goal to “celebrate, inspire and accelerate high-growth entrepreneurship throughout the nation,” the program is one part project finance and one part project assistance, initially focusing on the clean technology sector.
The Small Business Administration has already committed to the Startup America program, pledging an astounding $2 billion over the next five years to companies in underserved communities or early stage companies caught in the valley of death. The potential impact on future producers and technology developers ranges from the ability for project participants to tap into regional accelerators equipped to link industry leaders with startup firms, to that $2 billion available for firms to utilize. And the best part, it won’t cost taxpayers a dime.
Elizabeth Echols, regional administrator for the SBA, says, “This is an area that I’m very passionate about, clean energy and green business—encouraging and helping U.S. companies to be at the forefront of this global industry. I want to make the U.S. a leader in innovation.” The SBA is focused on several key areas that will help companies bring their innovations to market. Through the Impact Investment Fund, the SBA has committed $1 billion for companies located in underserved communities, or companies in the clean energy sector. “Underserved markets, we believe, have a lot of potential,” Echols says. “There is a lot of potential there and so far so much of the startup activity and venture capital has been focused on the coasts. There is a lot of people with good ideas in between.”
Another focus area is the market gap for early-stage companies. That market gap, commonly known as the valley of death that happens for financing rounds of roughly $1 million to $5 million, according to Echols, can be overcome by tapping into the $1 billion available for financing set aside by the SBA. “The goal is to jumpstart these companies, and help them on their path towards growth and creating more cleantech jobs,” she says.
In addition to the $2 billion worth of funding, the SBA has also set up the Entrepreneurial Mentor Corps. The program will initially help 100 cleantech startups by linking them with industry experts, university laboratories and other applicable partners, giving early-stage firms access to what Echols calls “entrepreneurial ecosystems.” Initially, she says, the program will cater to 100 cleantech startups (which have already received funding from the U.S. government), but “we want to grow that to 1,000.”
The EMC clean energy pilot is a collaboration between the U.S. DOE, the Advanced Research Projects Agency-Energy, and the SBA. A company can apply to one of four designated accelerators. Each accelerator was chosen, Echols says, for its geographic location and expansive reach. “Anybody can go and apply,” she adds, noting that the accelerators will be looking for companies and entrepreneurs with a clear plan to where they want to go. “We believe it is absolutely critical for the economy, for national security purposes and for the environment,” she says, explaining the program’s main drivers.