Grow Me State Initiative

download Grow Me State Advocacy book
(summary of research and programs)

download Grow Me State Briefing book
(more detailed report of research and programs)

download Grow Me State presentation

Angel Tax Credit

State Angel Tax Credit programs help bridge the gap in equity funding for advanced technology startup businesses so they can reach their next level of growth.

How does it work?

• Investors would be eligible to receive a 30% tax credit (40% in rural and distressed areas) for investing in a qualified small business. 

• Investors would be required to hold their investments for at least three years.  The maximum amount eligible for the credit is $50,000 per investment and a total of $100,000 per investor

• The program would have an initial annual cap of $5 million.

Proof of Concept Loan Program

The Proof of Concept program is designed to help advanced technology companies with high-growth potential reach their next stage of business funding.

How does it work?

• Approximately 25 awards of $50,000 each ($1.25 million per year) would be available annually in the form of forgivable loans.

• Some companies will fail, but most will succeed.  When they do, companies are required to repay the loan within five years, with a minimum repayment of two times the original amount of the loan.  These paybacks will be rolled back into the program for future awards, enabling the program to become self-funding.

• Companies must also leverage one dollar of private investment for every dollar of state financial assistance.  

• To be eligible companies must be classified as a small business and 50% of employees and assets must be located in Missouri.  Employee salaries must be 35-40% higher than the average county wage.

Seed Capital Co-Investment Revolving Fund

The Seed Capital Revolving Fund is designed to help seed and early-stage advanced technology businesses in Missouri achieve their next level of growth.

How does it work?

• A state revolving fund made up of $10 million annually would make up to 20 investments per year, at an average size of $500,000 per investment. 

• To attract professional fund managers and investors, the fund would need to receive appropriations for a minimum of five years. 

• To be eligible, the seed-stage or start-up companies would be required to obtain a 50% match of private funds.  Such businesses would also be required to have at least 50% of their employees and assets located in Missouri. 

• The funds may be used for a variety of activities depending on the company’s submitted business plan, including IP development, prototype creation, market studies, business operations, and securing a management team.

Missouri Technology Corporation Programs

The Missouri Technology Corporation (MTC) is a private not-for-profit corporation created by the Missouri General Assembly in 1994 to lead the state’s efforts in technology-based economic development.  The organization focuses on helping individuals and companies transfer new discoveries to the marketplace, creating high tech jobs for Missourians

SBIR Revolving Bridge Loan

Many high-tech companies that have received federal Small Business Innovation Research (SBIR) and Small Business Technology Transfer (SBTT) Phase I grants risk running out of money while they are waiting for their Phase II grants to be approved.  This lull occurs at a time when many start-up companies are at high risk of failure or being lured away to other states with competing incentive packages. 

To alleviate the risks of the funding gap, the MTC approves forgivable bridge loans to companies that allow them to continue working until their Phase II grants come in.  If the company receives the Phase II money then they must pay back the loan at a high interest rate.  If the company does not win the award then the loan is forgiven.

An infusion of $500,000 in state funding is needed to allow the successful SBIR loan program to continue.

Intellectual Property Management Fund

The Intellectual Property (IP) Management Fund was established to help Missouri-based start-up companies and universities pursue patent protection for promising new technologies.  Many universities and companies do not have the resources for filing appropriate patent protections for all of their ideas.  This makes them less attractive to venture capital companies, who prefer to invest in protected technology. 

The IP Management Fund provides up to $15,000 to assist with the preparation, filing, and prosecution of a patent application.  The fund is also available to Missouri Innovations Centers, Missouri Small Business Development Centers, and university technology transfer offices that assist start-up companies with licensing. 

A sum of $300,000 is needed to continue the program.