Application Period Open – January 2, 2013
Application Deadline – February 5, 2013
Investment Committee meeting – March 4, 2013 (tentative)
Final Approval – April 22, 2013 (tentative)
High-tech start-ups that succeed in proving a concept and launching a business need access to seed capital to position the company for venture capital financing. By increasing the quantity and quality of these high-tech start-up companies, Missouri can attract more venture capital investment to fuel the growth of our State’s economy and create high-paying jobs. MTC’s Seed Capital Co-Investment program (SeedCap) is designed to accelerate private investment in Missouri-based start-up companies and to increase the overall investment impact of that third-party investment. Through this program, MTC will award seed capital funds that match other capital investments. The seed capital may be used by the start-up company for advanced intellectual property development and evaluation, including in-depth analysis of market potential, conducting competitive analysis, advanced proof of concept work for a scientific discovery, advanced prototype design and development, research and development needed to attract venture capital financing, hiring key personnel, and related activities.
Program Goals
The Seed Capital Co-Investment Program seeks to achieve the following goals in Missouri:
- Accelerate the commercialization of research discoveries and growth of start-up companies;
- Increase the number of investment-grade start-up companies launched;
- Accelerate private capital investment;
- Position more Missouri-based companies to attract venture capital investment; and
- Create sustainable high-paying, private sector jobs.
Eligible Applicants
A Missouri-based start-up company (or company relocating its headquarters and operations to Missouri) that meets the following minimum requirements:
- Has a committed leadership team with significant experience related to the technology being commercialized or committed collaborators and/or mentors with such experience;
- Has a committed leadership team with significant experience successfully launching a start-up technology business or a committed collaborator and/or mentor with such experience, which may include a relationship with an innovation center or other entrepreneurial support organization that can provide expertise appropriate to the project;
- Is committed to successfully growing a start-up company that commercializes a discovery aligned with one of the following Missouri high-tech industry clusters: animal health, plant science, biomedical science, applied engineering, or defense and homeland security;
- Has a viable plan (i) for securing follow-on venture capital financing needed to successfully grow the start-up company; or (ii) to successfully sustain the company upon completion of seed-stage financing;
- Has an actual, conditional, or anticipated market-based third-party investment commitment that (i) equals at least 100 percent of the total requested SeedCap funding; and (ii) will close and transfer the proceeds of the investment to the company in a syndicate with the SeedCap funding;
- Is in a seed capital financing stage, which generally means that the start-up company has not exceeded total debt and equity financing of $1,500,000 (excluding the requested Missouri SeedCap funding; required Missouri SeedCap matching funding; sponsored research; and SBIR/STTR awards);
- Has less than 500 existing employees;
- Will not use the Missouri SeedCap funding for any prohibited purpose as set forth in the program application or by the U.S. Department of Treasury; and
- Has not previously been awarded Missouri SeedCap funding.
Evaluation Criteria
The submissions by Eligible Applicants will be evaluated based on dimensions of the quality of the submission and a demonstrated likelihood to achieve the following outcomes in Missouri:
- Accelerate the growth of a high-tech, start-up company;
- Increase research and capital investment funding;
- Leverage private investment;
- Create successful collaborations and partnerships needed to commercialize technology and accelerate the growth of a high-tech start-up company;
- Develop solutions to solve key business and technical milestones to position the start-up company and its core technology for additional venture capital funding and marketplace penetration;
- Strengthen one or more of MTC’s targeted high-tech clusters; and
- Create sustainable high-paying, private sector jobs.
Funding Available
The amount of requested co-investment should be specifically and narrowly tailored to the plan outlined in the application submitted to MTC, but individual awards will not exceed $500,000. Accordingly, it is not expected that each applicant will request the maximum amount of funds that may be awarded under this program. Awards will be in the form of equity or convertible debt.