NJ Innovation Fund dedicated to women-led startups. How awesome is that?
25% of the $500M NJ Innovation Evergreen Fund (NJIEF) will go to women-owned businesses. The New Jersey Economic Development Authority (NJEDA) has set this extraordinary goal.
This Fund, created out of the Economic Recovery Act, aims to reclaim New Jersey’s innovation leadership role.
Tim Sullivan, CEO of NJEDA, shared this information during a conversation with Aaron Price, President & CEO of TechUnited:NJ. At the end of the webinar, I asked the question I’m sure every female entrepreneur was thinking of:
‘In 2019, only 2.8% of venture capital went to women-owned businesses. How do you plan to correct for that?’
The answer was more than I’d expected. NJEDA’s goal is to give one-forth of the money to female-owned businesses. Indeed, a ten-fold increase over the current average and quite a whopping sum of $125M!
How does it work?
The New Jersey Innovation Evergreen Fund was created as a partnership with the private sector. It will raise and invest money in companies based in New Jersey. The problem it solves is the shortage of venture capital funding in the state. Therefore, its mission is to improve the entrepreneurial ecosystem and to facilitate innovation and success for the NJ business.
Qualified venture firms will purchase tax credits to invest in innovation programs. Then, qualified businesses in innovative industries will receive funding. Also, the NJEDA will give dividends and returns on investments back to the Fund. As explained by Mr. Sullivan, that is how the Fund will become self-sustaining or ‘evergreen.’
In the meantime, there are some policy and regulations changes still being worked out. But once out of the way, the program will start rolling out and, hopefully getting traction.
What businesses would qualify?
- Companies operating in New Jersey.
- Entities with less than 250 employees.
- Businesses from targeted industries. Targeted industries are, for example, autonomous and zero-emission vehicles, clean energy, information and high-tech, etc. In addition, ‘other innovative industries that disrupt current technologies or business models’ could also make the list.
Indeed, it is super exciting to know that female-owned companies can apply and get $125M of the NJIEF. Women-entrepreneurs, watch out for the program’s rollout in the fall of 2021!