Missouri Technology Corp. (MTC) plans to launch several new programs aimed at boosting statewide entrepreneurship, thanks to an increase in state and federal funding for the public-private organization.
MTC released a fiscal 2024 strategic plan that involves creating new funding programs and additional initiatives designed to foster regional entrepreneurial hubs and increase investor education. The blueprint also outlines plans to continue providing increased funding for existing programs that fund startups and entrepreneur support organizations in Missouri.
Created by the Missouri General Assembly, MTC is a public-private partnership that promotes entrepreneurship and provides investment to startups and entrepreneur support organizations. Through its venture capital program, Idea Fund, MTC has provided about $47 million in financing to 145-plus startups located throughout Missouri.
MTC said its ability to increase its programming stems from a boost in funding it has received in recent years. In fiscal 2023, MTC received $8.5 million in funding for its programming and administration functions, up from $3 million the prior year. A further increase in funding has come in fiscal 2024, with MTC being appropriated $15 million in funding from the state of Missouri. Additionally, MTC last year was allocated $95 million through the U.S. Treasury Department’s State Small Business Credit Initiative (SSBCI) to significantly ramp up its venture capital program and help finance socially and economically disadvantaged businesses.
MTC is using its expanded funding to target several new programs, including one designed to create regional entrepreneur hubs across the state. The program, called Regional Nodes, aims to have entrepreneur support groups within regions of the state partner to create regional entrepreneur hubs. MTC said its goal with the program is to have entrepreneur support groups “coalesce their assets in support of innovation and entrepreneurship through coordinated partnerships among entrepreneurial service organizations” within regions of the state. It hopes the nodes can act as “a front door” for entrepreneurs to connect with resources to help them launch and grow businesses. MTC intends to initially award planning grants for the creation of regional nodes and then later launch grants that award funding to implement the plan formed by the different groups.
MTC Executive Director Jack Scatizzi said the Regional Nodes program offers the chance for MTC to link together different parts of Missouri. For example, if an entrepreneur in one part of the state needs access to resources in a different region of Missouri, they could be connected to a regional node in that area. The Regional Nodes program also offers an opportunity to support a wide swath of entrepreneurs, Scatizzi said.
“We believe that through regional nodes this is a strong avenue for us to provide capital to general entrepreneurships in a region. Nodes don’t have to be focused on tech or innovation or high-growth entrepreneurship. Nodes can be used just to pull all of a region’s entrepreneurial resources together,” he said.
MTC’s strategic plan also includes increasing funding programs for startups. That includes piloting a proof-of-concept investment program that would provide equity-based investments of $50,000 or less to early stage companies to assist with the “initial commercial development of their products or services.” MTC will also use its SSBCI funding to launch a $15 million loan financing program for socially and economically disadvantaged businesses. MTC has selected St. Louis-based finance broker Justine Petersen to operate the loan program. MTC said in its strategic plan it is awaiting final approval from the U.S. Treasury Department for the loan program and expects it to be launched by early 2024.
In fiscal 2024, MTC also plans to pilot an “investor education” grant program to support education programs regarding venture capital investment. It also will continue operating a physical infrastructure grant program it piloted last year to support physical workspaces for entrepreneurs. MTC said it provided more than $1 million in grants through the program in fiscal 2023. One of the recipients of the funding was local innovation hub BioSTL, which received funding for lab facilities at its BioSTL Building in the Cortex innovation district and at the Helix Biotech Incubator in Creve Coeur.
Scatizzi said MTC’s state and federal funding will also allow it to continue to increase awards given through its longstanding Missouri Building Entrepreneurial Capacity Program (MOBEC) and its Idea Fund. MTC in 2023 awarded $2 million-plus in MOBEC grants, up from over $1 million in the prior year. Local recipients in 2023 included BioSTL, LaunchCode, Lindenwood University and UMSL Accelerate.
MTC in fiscal 2023 awarded more than $7 million through its venture capital investment program. MTC in past years had historically awarded $1 million to $1.5 million annually through the program, Scatizzi said. MTC said in its strategic plan it expects to provide $8 million to $10 million to startups through the venture capital investment program in fiscal 2024.
