Small business

SMALL BUSINESS PROGRAMS

Small Business Programs

Microenterprise Tax Credit Advantage www.nebbiz.org

The Nebraska Enterprise Fund The Nebraska Enterprise Fund is a statewide financial intermediary dedicated to supporting microenterprise companies. In 1997, the Nebraska Microenterprise Partnership Fund became incorporated as a 501(c)(3) and became a certified Community Development Financial Institution in 1998.

A 20 percent refundable tax credit is available to micro businesses based on increased compensation for employees or increased investment in targeted communities. Applicants may qualify for a maximum $10,000 throughout the life of the program. This credit is limited to companies that have five or fewer employees at the time the application is filed, including start-ups. Credits are approved on a first-in, first-out basis through an application process with the Nebraska Department of Revenue. Credits are earned on increased expenditures for wages, buildings, certain expenses and non-vehicle depreciable personal property.

Business Innovation Act The Business Innovation Act helps businesses develop new technologies and leverage innovation to enhance quality job opportunities in the state. It provides competitive matching grants for research, development and innovation – and helps expand small business and entrepreneurial outreach efforts. Eligible grant activities include: prototype development, product commercialization and applied research in the state as well as support for small business and microenterprise lending.

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Angel Investment Tax Credit The Angel Investment Tax credit encourages investment in high-tech start-up enterprises in Nebraska by providing 35-to-40 percent refundable state income tax credits to qualified Nebraskans investing in qualified early-stage companies.

Capped at $3 million annually, the program requires a minimum investment of $25,000 for individuals and $50,000 for investment funds. Eligible small businesses must have fewer than 25 employees with the majority based in the state.

Nebraska Progress Loan Fund (NPLF) The Nebraska Progress Loan Fund will make loans to qualifying small businesses.

Qualifying small businesses employ fewer than 750 full-time-equivalent employees. Generally, the applicants represent existing and start-up businesses experiencing financing challenges. The minimum loan to any one business will be $50,000 with a maximum of $2 million. NPLF funding must be matched at least 1:1 with private sources of capital. NPLF funds are also available for up to three years as interim financing of larger projects. The interim loan maximum amount is $5 million. Generally, the initial interest rate is zero percent but after the initial three-year period, may be renegotiated to an interest rate ranging from zero to 4 percent.

Nebraska Economic Gardening Program The purpose of the Nebraska Economic Gardening Program, authorized by the Small Business Innovation Act, is to provide technical assistance – which may include information tools, state and national demographic trends, competitive intelligence, marketing lists, strategy, analysis, capital referrals and labor analysis – for up to 40 Nebraska-based growth businesses, one half of which are located in counties with populations of fewer than 50,000 people.

Additional Business Assistance and Financing Programs Nebraska has assistance programs to help businesses stay competitive and/or find financing. Assistance ranges from helping find incubator space to helping identify manufacturing technology assistance. Aiding businesses is an important part of Nebraska’s business-development incentive package.

• The Nebraska Economic Development Corporation (NEDCO) is an IRS-designated 501(c)(3) nonprofit corporation promoting economic development and job creation throughout Nebraska. NEDCO is licensed as a Certified Development Company by the U.S. Small Business Administration to offer the SBA 504 Loan Program.

• The Nebraska Business Development Center assists in planning, analysis, market research, feasibility studies and computer training.

• The Food Processing Center provides expertise for the food processing industry in manufacturing, technology, marketing and business development.

• The Omaha Business and Technology Center offers a business-incubator facility to aid growth of small businesses in Omaha.

Nebraska Angel Sidecar Fund The Nebraska Angel Sidecar Fund provides early investment capital that matches private angel investment in start-up businesses that are developing, modifying or employing new technology. The Invest Nebraska Corporation utilizes the Angel Sidecar Fund to accelerate private investment in Nebraska-based startup companies and increase overall investment impact. The seed capital may be used by the start-up company for advanced intellectual property development and evaluation, advanced proof of concept work for scientific discovery, advanced prototype design and development, hiring key personnel and related activities.

ELIGIBLE NEBRASKA-BASED START-UP COMPANIES MUST HAVE: • Committed leadership teams with significant experience commercializing technology and launching a start-up technology business, or committed collaborators and/or mentors with such experience • Viable plans for securing the venture capital financing needed to successfully grow the start-up company within a reasonable time period after the seed capital coinvestment • Market-based, third-party investment commitments equal to at least 100 percent of the total requested seed capital funding from the Angel Sidecar Fund Sidecar investments are available in amounts ranging from $50,000 to $500,000. The angel funding group must match the Angel Sidecar Fund investment at a ratio of at least 1:1.

Sidecar investments made by the Invest Nebraska Corporation and participating angel group will result in either convertible debt or equity being invested into the qualifying small business. There are other restrictions related to the use of Angel Sidecar Fund funding.

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IOWA SMALL BUSINESS Entrepreneurial/Small Business Major programs for entrepreneurial/small business financial assistance include:

Demonstration Fund: provides financial and technical assistance to encourage high technology prototype and concept development activities that have a clear potential to lead to commercially viable products or services within a reasonable period of time

Iowa LAUNCH Program: designed to help innovative entrepreneurs overcome the principal challenges of launching new start-ups that leverage discoveries and talent at Iowa’s world-class public and private research universities and other research organizations

Iowa Capital Access (ICAP): assists Iowa businesses in securing the financing they need to launch, retain, or expand business operations in Iowa

Iowa PROPEL: designed to accelerate private investment in Iowa-based start-up companies and to increase the overall investment impact

Iowa Innovation Acceleration: promotes the formation and growth of businesses that engage in the transfer of technology into competitive, profitable companies that create highpaying jobs

Innovation Expansion Program: designed to encourage expansion of product lines in existing companies through product refinement, market planning and market entry activities for unique innovative products to support competitive, profitable companies that create high-paying jobs and wealth in Iowa Iowa Small Business Loan Support Program: aids Iowa entrepreneurs and small businesses in their efforts to access capital for business purposes including start-up costs, working capital, business procurement, franchise fees, equipment and inventory as well as the renovation or tenant improvements of an eligible place of business that is not for passive real estate investment purposes Targeted Small Business Program (TSP): designed to help women, minorities, and the disabled overcome some of the major hurdles to starting and growing a small business in Iowa

SelectGreaterOmaha.com 402-346-5000 • 800-852-2622 1301 Harney St., Omaha, NE 68102

June 2014