Capital Catalyst

Program Goal:

The goal of the Capital Catalyst program is to incent capital formation and investment in startups and emerging growth companies in the state of Wisconsin.

The program primarily supports the following WEDC Strategic Pillar and Focus Area:

Business Development: Entrepreneurship and Innovation

Program Description:

The program provides matching grants to seed funds managed by local communities and other eligible entities to provide capital to high-growth startups and emerging growth companies.

The program increases the availability of capital to startups and emerging growth companies to support growth and attract additional private investment.

Eligibility Requirements:

Applicants for Capital Catalyst funds must demonstrate organizational capability and the availability of entrepreneurial support to achieve the goals of their program. Capital Catalyst fund recipients may include communities, organizations or other entities.

Applicants should have an established investment/selection committee, investment/funding criteria, and application process. Eligibility for the program requires a 1:1 match of the amount of funding provided by WEDC. This match must be documented prior to the disbursement of funds.

Investment/funding decisions will focus on assistance to companies in industry sectors including but not limited to advanced manufacturing, agriculture or food processing, information systems or software, medical devices, biosciences and energy.

Use of Funds:

Capital Catalyst recipients are required to make grants, debt, royalty-based investments and/or equity investments in startups, early stage and emerging growth companies that are located in or will locate in Wisconsin. Recipients will agree to utilize a segregated account to receive direct grant funding from WEDC that may include the recipient’s matching funds.

Capital Catalyst recipients must provide at least one-third of the amount of WEDC funds as grants to companies in amounts per company not to exceed 10 percent of the total amount of WEDC funding provided to the fund.

Funds may not be used to support expenses related to the relocation of a business between communities in Wisconsin.

Returns on loans and/or investments to the fund capitalized by WEDC and matching funds may be used only for additional awards to eligible businesses, direct administrative expenses of the recipient, and/or other purposes approved by WEDC. Returns may not be distributed to an individual or for-profit entity that was a source(s) of matching funds prior to the end of the final performance reporting period.

Incentives and Available Funding (FY17): $1,500,000

The program provides grants to approved Capital Catalyst recipients that establish seed funds and meet the eligibility requirements of the program.

Activities and Expected Outcomes:

Award four organizations to support the financing of 45 startup and emerging growth companies, and impact 60 jobs. Recipients will maintain an average co-investment ratio of 1:1, and companies financed by local seed funds will achieve a 3:1 leverage of other investment.

Performance Reporting:

Recipients will be required to periodically submit a performance report documenting job creation, job retention and number of organizations assisted, as well as any other contract deliverable.

WEDC may impose additional reporting requirements to evaluate project performance and to ensure compliance with contract deliverables.

Application and Awards Process:

Applicants for a Capital Catalyst grant should complete an application through an an account manager. The application will be assigned to an underwriter and go through the award review process.

Applicants for Capital Catalyst program funding are required to provide to WEDC, in writing, information on the applicant organization, investment fund management and strategies, and the process for approving awards made from the fund.

For more information on application review, internal process and award distribution, please refer to WEDC’s award administration policies and procedures.