Tennessee Resources

INCITE Co-Investment Fund

Launch Tennessee
(615) 673-4419
info@launchtn.org

Purpose of Initiative

The INCITE Co-Investment Fund is an initiative designed to drive growth and create knowledge-based jobs in Tennessee by encouraging investment in the state’s developing small businesses. The program is administered by Launch Tennessee and the Fund matches a portion of investments in Tennessee-based companies.

Award Details

There are three tiers—tier 1 is associated with seed stage investment, tier 2 is associated with early/growth stage investments, and tier 3 is associated with expansion stage investment. There is a 50% match for tier 1 investments, a 33% match for tier 2 investments, and a 25% match (capped at $3 million) for tier 3 investments.

Eligibility

There are two levels of eligibility for this program. Investors must apply to become an approved investor and there are also requirements that determine whether an investment is, in fact, a qualified investment. Before applying for Co-Investment funding, an applicant must be certified by Launch Tennessee as an Approved Investor. Approved Investors must meet the criteria below:

  • They must fit into any of the following categories: TNInvestco (as certified by the State of Tennessee, in compliance with T.C.A. § 4-28-101 et seq.); Small Business Investment Company (SBIC), New Market Venture Capital Company or Rural Business Investment Company, as certified by the U.S. Small Business Administration; A person or entity that has at least $5 million of assets under management, or an investment vehicle that is managed exclusively by a person or entity having at least $5 million of assets under management, and is deemed an accredited investor under the Securities Act of 1933; or a person or entity that is deemed an accredited investor under the Securities Act of 1933. A person or entity approved solely under this Section D (i) is only eligible to participate in Qualified Investments in which there is a participating Approved Investor as qualified under Section A, B, or C above and (ii) is not eligible to be the lead Approved Investor for the respective Qualified Investment transaction.
  • Investors must submit a fully completed Approved Investor application to Launch Tennessee. The application is available here.
  • A Qualified Investment is defined as an investment of cash by an Approved Investor in a Qualified Business for the purchase of equity or equity warrants.
  • A Qualified Business is one that meets the following criteria: the business must be a non-public company; the business must be headquartered in Tennessee; the company’s principal business operations must be located in Tennessee; at least 60% of its employees must be providing services in Tennessee to the business; and the business cannot be involved in the following business areas: real estate (development or leasing), insurance, banking, lending, professional services (layer, accountant, investment advisor, or physician), oil and gas exploration, mining, gambling enterprises (unless the business earns less than 33% of its annual net revenue from lottery sales), construction, the production or distribution of motion pictures/television shows/sound recordings, pyramid sales, accommodation/food service establishments, and retail establishments (except when the primary purpose of the business is the development or support of electronic commerce using the Internet). Businesses must have less than 500 existing employees. Additional criteria are outlined through the website.
  • A Qualified Business must use Co-Investment funding for a business purpose, including start-up costs, working capital, business procurement, franchise fees, equipment, inventory, and the purchase, construction, or renovation, or tenant improvements for an eligible place of business that is not for passive real estate investment purposes. Funds may not be used for activities that relate to acquiring or holding passive investments or lobbying activities; reimbursing funds owed to any owner; purchasing any portion of the ownership interest of any owner of the qualified business; effecting a change that is not designed for the long-term benefit of the qualified business; refinancing existing debt where the lender is in a position to sustain a loss and the government would take over that loss; repaying delinquent federal or state income taxes; repaying taxes held in trust or escrow; or conducting basic or discovery research that is traditionally federally-funded (which is not intended to include general product development research).

Application Information

Application information is available here.

Tennessee Community Ventures

Tennessee Community Ventures
bizplan@tncvfund.com

Purpose of Initiative

Tennessee Community Ventures is focused on technology transfer, seed, and early stage investment opportunities. TNCV identifies technologies, products, and services that offer a unique solution to a particular problem or opportunity for their respective industries, lend themselves to business models that offer a clear path to profitability (with modest capital needs), and promote scalable cost structures that create competitive advantages.

Eligibility

Opportunities will be subject to TNCV’s rigorous due diligence process and will need to meet the following investment criteria: highly motivated and experienced management team; differentiated and scalable technology, products, or services that address new market opportunities or are sufficiently disruptive to established market solutions; strong customer value proposition and customers who will pay a premium for a unique offering; long-term potential to transform new or existing markets poised for rapid growth or change; potential to achieve significant market share in a large and growing market; ability to grow independent of market conditions; and availability of multiple exit opportunities.

Award Details

TNCV has committed capital to proof-of-concept investments, which are expected to range from $50,000-$100,000. More traditional seed and early stage initial investments are expected to range from $250,000 to $750,000 and target the funding gap between start-up and later stage institutional venture rounds. TNCV’s target investment size over the life of each portfolio company is between $1 million and $2 million. The target investment size is typically achieved through multiple rounds of investment.

TNInvestco

Lamont Price
Tennessee Department of Economic and Community Development
312 Rosa L. Parks Avenue, 26th Floor
Nashville, TN 37243
(615) 741-9301
Lamont.price@tn.gov

Purpose of Initiative

TNInvestco is a state-sponsored, venture capital program that provides capital to high-growth, transformational businesses in Tennessee. The goals of the program are to develop the entrepreneurial infrastructure across the state, to attract new capital to Tennessee and to diversify the state’s economy and create jobs through the development of “innovation clusters” that result in new companies being spun off.

Eligibility and Restrictions

For Tennessee small and start-up businesses to qualify for TNInvestco funds, they must be independently owned and operated. The business must be headquartered and principally operated in Tennessee with at least 60% of its employees located in Tennessee. The business must not be primarily engaged in professional services (accounting, medicine, or legal services), banking or lending, real estate development, insurance, oil and gas exploration, or direct gambling services. The company should demonstrate a high potential for growth and must have no more than 100 employees. A business from outside of Tennessee may be considered for the program if they commit to move their headquarters and operations within 12 months after receiving funding from TNInvestco.

Application Information

Interested companies can fill out an application form for the program.

Council & Enhanced Tennessee Fund

Tyler Augusty
30 Burton Hills Boulevard, Suite 576
Nashville, TN 37215
Phone: 615-255-3707
Fax: 615-255-3709
taugusty@councilcapital.com

John Davis
30 Burton Hills Boulevard, Suite 576
Nashville, TN 37216
Phone: 615-255-3707 x312
Fax: 615-255-3709
jdavis@councilcapital.com

Purpose of Initiative

Council & Enhanced Tennessee Fund, LLC is a venture capital and private equity firm specializing in seed, early stage, mid venture and late venture investments. The firm focuses on companies in all sectors. It primarily invests in Tennessee. The firm seeks to invest in high-growth companies including minority-owned and women-owned businesses.

Eligibility

The Council & Enhanced Tennessee Fund seeks to invest in companies with exceptional management teams, attractive unit economics (for example, a high percentage of revenue coming from recurring and repeating customer purchases), appropriate concept risk, large market opportunities, scalable business models, and those that satisfy TNInvestco requirements.

Updated March 2018 by Kevine Lidoro

Developing Network Contacts (DevNC)

When you need to reach out...

There are times when you need to reach out to others – whether you are looking for potential customers, potential partners, or potential investors. But who should you call…and how do you address your fear of contacting them. The DevNC is a unique market research tool designed to provide you with between 25 and 30 Points of Contact (PoC). With each POC, information is included that provides insight about the person’s role. Depending on their position, other information commonly included relates to their background, articles that they have written, conference presentations and other pertinent information. This type of information enables you to customize your correspondence. Contact information is also included  – typically LinkedIn, email and phone number.

Competitor Analysis

Your customers know your competitors! Do you?

Maybe you believe that you don’t have any competition, but your customers know better! Their needs are being addressed now – perhaps not as well, but if there is a need, someone is providing a solution. Learn about the competition and be prepared to differentiate your solution from that of others. Dawnbreaker’s competitor analysis contrasts your competition on specifications, performance and price. Armed with this information we can help you create a compelling value proposition.

DoD Transition Information Packet (TIP)®

The Transition Information Packet (TIP) is a market research report specifically developed for small businesses working with the Department of Defense.

Customized Market Research (CMR)®

Filling in the gaps in your commercialization strategy….

The CMR provides our team with the greatest flexibility in addressing gaps in the information you need to refine your commercialization strategy. Based strictly on secondary literature, the market researcher can look for information that will help you understand changes in government regulations, market dynamics, emerging solutions, sources of funding, points of contact and other challenges you pose. Based on the information gathered, a business strategist will add comments throughout regarding the implications of the information for your strategy.

LICA Licensee Analysis®

Who will take the best care of your baby?

You’ve done a great job with your R&D. You’ve been careful to protect your intellectual property – but those next steps to bring the product to market seem out of reach. There’s too much competition, scale up would be too expensive – so you’ve decided to license-out your intellectual property. The challenge before you is to find the best licensee to bring your baby to market. Let us help you. We will profile organizations that frequently cite your patents and dig deeper to determine their financial health, technology and market synergies, and experience with licensing-in.

Commercial Potential Assessment (CPA)

Be wary of big numbers!

You’ve done a great job with your R&D. You’ve been careful to protect your intellectual property – but those next steps to bring the product to market seem out of reach. There’s too much competition, scale up would be too expensive – so you’ve decided to license-out your intellectual property. The challenge before you is to find the best licensee to bring your baby to market. Let us help you. We will profile organizations that frequently cite your patents and dig deeper to determine their financial health, technology and market synergies, and experience with licensing-in.