Today, the Baker-Polito Administration announced plans to administer $168,591,178 from the U.S. Department of the Treasury to promote small business growth and entrepreneurship in Massachusetts. This funding, awarded to the Commonwealth of Massachusetts under the State Small Business Credit Initiative (SSBCI), will support new or expanded programs offered by quasi-public agencies MassDevelopment, Massachusetts Growth Capital Corporation (MGCC), and MassVentures that provide access to capital for small businesses and entrepreneurs. These programs are designed to target small businesses, especially those owned and controlled by economically and socially disadvantaged individuals.
“Since taking office, we have been committed to supporting small businesses in communities across Massachusetts,” said Governor Charlie Baker. “This federal funding will allow us to increase access to capital for small businesses and entrepreneurs, helping them create jobs and expand their footprint here in the Commonwealth.”
“Small businesses are the heart of our main streets and local economies,” said Lt. Governor Karyn Polito. “We are incredibly pleased to be able to expand the suite of resources available from our quasi-public partners that enable small businesses to finance real estate, equipment purchases, and other projects, and are grateful for this support from the federal government.”
“This major federal investment will directly benefit our economy by empowering small businesses and entrepreneurs in Massachusetts – especially our smallest and underserved businesses – with the capital they need to grow,” said Housing and Economic Development Secretary Mike Kennealy. “MassDevelopment, Massachusetts Growth Capital Corporation, and MassVentures already play a critical role advancing equitable business growth in the Commonwealth, and this funding will allow these agencies to expand their loan offerings to reach more companies.”
Funding will be distributed among the following programs:
- Enhanced Economic Development Loans
This expanded program for real estate, equipment, and leasehold improvement loans makes direct loans for no more than 50% of the total debt package with extremely flexible terms.
- Enhanced Loan Guarantees
This expanded program partners with banks to provide guarantees of up to 50% of the loan amount, on loans for real estate, equipment, and leasehold improvements.
Massachusetts Growth Capital Corporation (MGCC)
- Commercial Lending Program
This existing program makes direct (companion) loans for no more than 50% of the total financing to small business borrowers using its own balance sheet funds.
- Community Loan Fund Guarantee
This new program will guarantee up to 50% of the principal loan amount originated by its community partners (banks and nonprofit community lenders) up to an average of $250,000.
- Deep Tech Diversity Venture Fund
This fund provides pre-seed, seed, seed-extension, and early-stage venture capital equity investments to deep tech startups (e.g. advanced manufacturing and materials, robotics, AI, synthetic biology, quantum, and clean tech). MassVentures has already led or co-led three investments leveraging almost 7X in private capital with the SSBCI funds.
The State Small Business Credit Initiative (SSBCI) was established by Congress as part of the Jobs Act of 2010 and was reauthorized in the American Rescue Plan Act (ARPA) of 2021, which authorized $10 billion to be allocated nationwide. The Commonwealth was awarded $168,591,178 that will be disbursed in three tranches.
“We will be intentional in the use of this significant commitment from the Federal Government to help historically disadvantaged small business owners grow their business and build generational wealth,” said MassDevelopment President and CEO Dan Rivera. “These small businesses and entrepreneurs – many of whom are from diverse backgrounds – energize our local economies with creativity, innovation, and quality jobs.”
“The deployment of these loan funds and guarantees by MGCC to those businesses that are most in need, will continue empowering small businesses that may not have access to capital across the Commonwealth,” said Massachusetts Growth Capital Corporation President and CEO Larry Andrews.
“This support advances Massachusetts’ leadership at deep tech scientific and engineering discovery, while positioning the state as an innovation hot spot for diverse founders as well as founders from traditionally underserved regions of the state,” said MassVentures CEO and President Charlie Hipwood. “We are grateful for this support.”
“The Coalition for an Equitable Economy (CEE) is proud to have worked with Secretary Kennealy to advocate for this support to help Massachusetts entrepreneurs and small businesses thrive, particularly in underserved communities,” said Coalition for an Equitable Economy Executive Director Tracye Whitfield. “CEE partners have heard from many small business owners who need extra financial assistance getting off the ground. This is why the SSBCI funds are so important and needed.”
To learn more about these and other available resources, visit massdevelopment.com, empoweringsmallbusiness.org, and mass-ventures.com.