April 21, 2015 (Brunswick, Maine)–The Maine Technology Institute (MTI) and Coastal Enterprises, Inc. (CEI) have created a collaborative loan program to provide lines of credit to Maine companies that win federal grant awards. Termed the Federal Grantee Loan Program, this initiative will provide bridge capital from CEI for those who receive federal awards to perform specific research and development work for a particular federal agency. The new loan program addresses challenging cash flow issues encountered with the various payment standards from the federal agencies. Future awardees of the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) grants as well as the recipients of Broad Agency Announcement (BAA) awards will be able to arrange streamlined financing that helps to maintain cash and credit balances without the risk of high debt.
Eleven federal agencies participate in the SBIR/ STTR program and some agencies use the BAA process for early stage research and development. According to Karen West, MTI’s Technical Assistance Program Consultant, Maine businesses receive approximately $5 to 6 million in total SBIR/STTR awards annually. The size of the individual federal grants can range from under $100,000 to $1 million. BAA awards can be even larger, at several million dollars or more.
MTI, a private, non-profit organization that stimulates business investment in technology development across Maine’s seven key technology sectors, regularly works with Maine entrepreneurs and small businesses to help them qualify and apply for the grants. In the case of sizeable awards, the shortfall of operating cash threatens the success of the companies’ efforts, and they often seek financing from unconventional sources, such as credit cards.
“Entrepreneurs need ready access to cash while executing their projects, and this new Federal Grantee Loan Program from CEI helps fill that need. We are excited to partner with Coastal Enterprises on this vital effort,” states Brian Whitney, MTI’s Director.
CEI, a Maine non-profit Community Development Financial Institution, makes loans and equity investments in small and medium size businesses. “When we learned of the financing needs of Maine entrepreneurs through our special relationship with MTI, we saw an opportunity to provide capital to facilitate innovation by Maine businesses that have been awarded federal monies,” states Dick Clime, a CEI Development Specialist. “We now solve the cash flow problems that often go along with winning the awards and performing the work. This small initiative can provide a needed boost for start-up technology firms.” Additional information about the Federal Grantee Loans is available by contacting Karen West at MTI (email@example.com) or Dick Clime at CEI (firstname.lastname@example.org).
The Maine Technology Institute (MTI) is an industry-led, publicly-funded, nonprofit corporation that offers early-stage capital and commercialization assistance in the form of competitive grants, loans and equity investment for the research, development and application of technologies that create new products, processes and services, generating high-quality jobs across Maine.
The Maine Technology Institute was established by the Maine State Legislature in 1999. MTI, working with partners across the state, “shall encourage, promote, stimulate and support research and development activity leading to the commercialization of new products and services in the State’s technology-intensive industrial sectors to enhance the competitive position of those sectors and increase the likelihood that one or more of the sectors will support clusters of industrial activity and to create new jobs for Maine people.”
Coastal Enterprises, Inc. (CEI), one of the nation’s premier Community Development Corporations (CDCs) and Community Development Financial Institutions (CDFIs), specializes in rural business development and financing. Founded in 1977 in Wiscasset, Maine, CEI creates economically and environmentally healthy communities in which all people, especially those with low incomes, can reach their full potential. CEI provides financing and technical assistance to small and medium-sized businesses, natural resource-based industries including the farm, fish and forest sectors, community facilities, renewable energy, commercial real estate and affordable housing. CEI serves communities in Maine, New England, and rural regions throughout the U.S. Find out more at www.ceimaine.org.