Stories of Technology, Innovation, & Entrepreneurship in the Southeast

With the dawn of 2024 comes the opportunity to reacquaint readers with the new “InvestTN” program and the three funding buckets.

• There is a $28 million regional-based pre-seed/seed fund. Companies who apply to this fund are allocated to receive anywhere from $25,000 to $250,000.
• There is a $28 million technology fund for Series A or Series B stage start-ups. Founders who apply for this fund could receive anywhere from $250,000 to $3 million.
• Additionally, there is about $12 million allocated for a multi-funds component.

The funding represents Tennessee’s allocation of the most recent federal State Small Business Credit Initiative (SSBCI 2.0) which totals $10 billion nationally.

So far, companies located in 50 out of 95 counties in Tennessee have applied for some funding. Of those, 10 companies have been approved for investment, five of which are tech companies.

As of December, not one of the approved companies is based in Knox County.

Isaiah (Ziggy) Allenlundy, a Capital Coordinator with Launch Tennessee (LaunchTN), explained the program to the Knoxville Entrepreneurship and Small Business (ESB) Council of the Knoxville Chamber in December. He shared how the “InvestTN” funding is at “the intersection of venture capital and economic development.”

“InvestTN” provides a 1:1 match. Meaning, to obtain the “InvestTN” funding, a start-up company must also raise a private capital match at least equal to that amount.

“It gives the company more credibility when they’re able to tell private investors that LaunchTN is matching their funds,” Allenlundy said. “We want to see proven traction.”

There are a few different things that the team at LaunchTN is looking for in the application process. For example, the team is especially interested in investing primarily in venture backable companies based around health, tech, manufacturing, mobility, biotech, and ag tech.

By comparison, retail and hospitality companies would need to have a really competitive application to receive funding, but it’s not impossible, Allenlundy said.

In addition to the type of company, the application vetting process also looks at the challenges of the county or region where the start-up is based.

For example, a start-up based in a more rural county, with less access to resources is more likely to receive funding.

The ESB Council asked how Knoxville companies can stand out in the application process, and secure funding in our area.

Allenlundy said three aspects of the company application need to be solid.

1. There needs to be a scalable model.
2. The company needs to have a great, investable team.
3. There needs to be a thought out, and executable go-to-market strategy.

 

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