Transformative.
If there was a buzzword that came out of Monique Kuykendoll Quarterman’s presentation on the state of the entrepreneurship and innovation in Kentucky — that was it.
Quarterman — who took over the role of deputy executive director of KY Innovation on April 1 — used the word, or a variant, six times when addressing the approximately 90 people in attendance at Venture Connectors’ monthly luncheon at Story in NuLu this week.
And if Quarterman had to sum up the state of the state, so to speak, in three words.
“Vibrant, diverse and thriving,” she would say afterwards.
Quarterman's talking points included how Kentucky was on its way to becoming one of the top electric vehicle manufacturers in the nation, alluding to the construction of two EV battery plants in Hardin County.
“We are changing the landscape of Kentucky permanently. ... That’s transformative for Kentucky,” said Quarterman, whose organization is a part of the state’s Cabinet for Economic Development based out of Frankfort, Kentucky.
The biggest lasting change, though, may come from something that she shared with the group about midway through her presentation: A new initiative in which the state has applied for a historic $117 million in federal funding for access to capital through the U.S. Department of the Treasury’s State Small Business Credit Initiative (SSBCI), through a partnership with Kentucky Science & Technology Corporation (KSTC).
“I don’t mind sharing it out loud, because it’s something that I’m proud of,” Quarterman said. “It is something that I have been living and breathing for the entire year.”
The proposed funding has not been finalized, and specifics have not yet been made available. On Tuesday, the Biden administration announced that 11 other states would receive up to a collective $1 billion through the SSBCI program, as part of the $1.9 trillion stimulus bill passed last year known as the American Rescue Plan.
Could there be more funding on the way?
Although Quarterman lauded the success of well-established funds such as Keyhorse Capital and Commonwealth Seed Capital for deploying seed investments into small businesses and ventures throughout the state, she said there was a need for mid-level capital that the SSBCI was designed to address.
When the state initially applied for the SSBCI, its intention was to be used to improve access for lending for Kentucky small business owners. Now, through a growing number of community development financial institutions (CDFIs) throughout the state, Quarterman said her team has decided to “take a risk” by placing 70% of the allocation of the proposed funding in venture capital.
“We both find it important to go bold," she said.
Quarterman added that her team and its network of CDFIs are also in negotiations with the U.S. Treasury to bring in an additional $130 million in access to capital for Kentucky — bringing the grand sum closer to $250 million.
“This room is transforming,” she then told the crowd. “It’s not only transforming in the people who are filling the seats. It’s not only transforming the number of people who are here for the first time, but it is transforming and what we’re able to offer you every day when it comes to practitioners of innovation in the state of Kentucky.”
Kentucky is getting noticed
Lisa Bajorinas, executive director of Kentucky Innovation Hubs at KSTC, said that Kentucky could start pursuing such unprecedented amounts of federal funding thanks in large part to the nation taking notice of the state’s successes.
“[We] are being noticed for the innovation and entrepreneurship that we’re churning out here, which is then attracting outside sources of capital, including the opportunity with the State Small Business Credit Initiative ... to then invest in our early-stage companies. So those opportunities — and the greater awareness we’re attracting now — make that so inspiring.”
Quarterman also made sure to mention several “brag points” including the recent news of Kentucky being awarded $400,000 from the U.S. Small Business Association (SBA) to providing funding for its State Trade Expansion Program (STEP), which allows companies based in the state — with 500 employees or less — to export their goods to international markets through up to $10,000 in grant funding.
She also alluded to the recent accomplishments of Jason Marion, an environmental health science professor from Eastern Kentucky University who earned the Global Health and Innovation Conference (GHIC) Innovation Prize through his work on developing a cost-effective kit to test for E. coli testing in the water supplies of impoverished communities. KY Inno profiled Marion last year.
Quarterman talked about the growth in the number of members in the state’s higher education community that was being supported through KSTC’s Kentucky Commercialization Ventures (KCV), where she served as executive director prior to her current role with KY Innovation.
When KCV began in July 2020, a little more than 50,000 people were receiving support with commercialization and intellectual property services — albeit only at the University of Kentucky and the University of Louisville.
That number has increased to more than 220,000 from colleges and universities “from corner to corner of our state,” according to data gathered from the Integrated Postsecondary Education Data System and the Kentucky Council on Postsecondary Education.
In 2021, KCV was one of 18 of its kind to be awarded a Lab to Market Inclusive Innovation Ecosystems Prize award by the SBA.
KCV is "unlocking the wonderful, brilliant ideas that are grasped by supporting this much larger bar of people who are associated with higher ed, and have ideas that can change our world,” Quarterman said.
KCV's current leader, Kayla Meisner, emceed the Venture Connectors event.
At one point, Quarterman recalled the time that she first attended Venture Connectors in 2012 as a student at the University of Louisville, after being invited by a faculty member at the university. Back then, she said was a little “unsure” of the whole entrepreneurial scene in Kentucky.
That was then, as evidenced by her closing statement to the room.
“There’s no better time than now to start a small business in Kentucky," she said.
