Two new startup funding opportunities will soon be available to those living in Johnson County in an effort to help strengthen the region’s entrepreneurial ecosystem and help early-stage entrepreneurs grow their ideas.
The Iowa City Area Development Group (ICAD) is working with the Community Foundation of Johnson County and the University of Iowa to launch two new seed funding options for local startup companies.
The first initiative is to collaborate with the Community Foundation of Johnson County to create a new charitable giving fund. This fund would enable the community to make small forgivable loans to help scalable interstate commerce startups meet their match requirements for Iowa Economic Development Authority (IEDA) funding options such as the Proof of Commercial Relevance Program and the Demonstration Fund. These funding programs, managed by Venture Net Iowa, do high-quality due diligence and review on Iowa Startups. When a company receives notice of an IEDA award after this process, they will then be eligible to apply for this local match funding program to accelerate their growth with support from the local community.
“Gifts made to this fund demonstrate our community’s commitment to growing and supporting business development opportunities in our area,” said Shelly Maharry, Executive Director of the Community Foundation of Johnson County, in an announcement. “When we support our local entrepreneurs, we’re making an investment in our future. These entrepreneurs will grow jobs here, raise their families, serve on nonprofit boards, and give charitably to causes they care about. It’s a win – win all around.”
The second initiative is a seed fund that will focus on startups that are further along in their growth. The new Johnson County Seed fund is currently being developed with the goal of launching in the summer of 2020.
The new seed fund will be modeled after the success and longevity of the Ames Seed Capital Fund. The fund will be a standalone entity operated by a board of managers with administrative and management support provided by ICAD.
The fund will seek to raise $2 million to $4 million—with pledges of between $50,000 to $250,000 from local investors—to invest in scalable companies with a path to exit.
“We are very excited about the work being done to increase the availability of capital for regional entrepreneurs. It will provide much needed early stage funding and demonstrate the community’s commitment to building a vibrant entrepreneurial ecosystem where entrepreneurs can launch and build their companies right here,” said David K. Hensley, Executive Director of the John Pappajohn Entrepreneurial Center and Clinical Professor, Management & Entrepreneurship Department in the Tippie College of Business.