A new funding program from the Missouri Technology Corp. aims to support early-stage entrepreneurs developing technologies, products and solutions with high-growth potential.
MTC, led by Executive Director Jack Scatizzi, is a public-private partnership that was created by the Missouri General Assembly. It promotes entrepreneurship and provides investment to startups and entrepreneur support organizations.
MTC’s pilot Proof of Concept program “will help bridge the funding gap experienced by companies in their early stages of development” by providing them with equity investments ranging from $25,000 to $50,000, it said in a release. These capital infusions will allow companies “to prove out their concept and transform their innovative ideas into tangible realities,” as well as expedite their growth.
Early-stage companies often need capital to develop or launch a so-called minimum viable product – a basic version with enough features to allow a viable test – but find themselves too early in the startup lifecycle to receive angel or traditional venture capital investment, MTC said. This leads entrepreneurs to seek funding from friends and family, piece together non-dilutive sources or rely on credit cards for funding.
By providing capital at an early stage, MTC can support the growth of early-stage companies, many of which can contribute to economic development if allowed to receive initial risk-based capital investment through their state-sponsored venture capital program, officials said.
“Additionally, MTC envisions that these companies will achieve success in their development and growth, leading to job creation across Missouri and positioning the companies for further venture capital investment,” it said.
To receive MTC’s investment through the Proof of Concept Program, early-stage companies will need to provide a matching co-investment of equity, convertible debt and/or a non-dilutive grant. MTC said it prefers to participate up to 33% of the new capital in a funding round.
Companies eligible for MTC’s Proof of Concept Program will:
- Be based in Missouri;
- Have a proprietary or protectable intellectual property;
- Have completed ideation and customer discovery;
- Have, at the time of closing, a third-party dollar-for-dollar matching investment for MTC funds; and
- Focused in at least one of MTC’s seven core areas – biomedical and life sciences; health care technology and services; financial technology and services; software and data; energy; manufacturing; and supply chain and logistics.
Interested companies can learn more and apply for the program on MTC’s website. Applications received by Aug. 7 will be considered in the October 2024 award cycle.
MTC has been an early-stage investor in several high-profile St. Louis-area technology firms, including agriculture technology firm Benson Hill (NYSE: BHIL), a publicly traded company through a September 2021 merger with a special purpose acquisition company; Geneoscopy, which has raised more than $100 million in financing to develop a colon cancer test; and medical technology company MediBeacon Inc., whose largest shareholder is Pansend Life Sciences LLC, a subsidiary of New York-based Innovate Corp. (NYSE: VATE).
Earlier this month, MTC said it has awarded more than $50 million to early-stage companies through its state-sponsored venture capital program. It has been given a funding boost in recent years, with the Missouri General Assembly allocating MTC about $15 million in Missouri’s fiscal 2024 budget.
