The Delta Regional Authority and Winrock International announced in a teleconference Wednesday the DRA's $1 million contribution to the early state, proof-of-concept I-Fund, which officials say will provide the initial dollars that startups struggle to obtain and bring jobs to the eight-state Delta region.
IberiaBank invested $1 million in the public-private partnership program earlier this year, and the fund now has $2 million. Officials said the DRA's investment was made in partnership with the U.S. Economic Development Administration.
Jeff Stinson, director of entrepreneurship for the Arkansas Regional Innovation Hub (which is part of Winrock), said he hoped 20-25 startups/entrepreneurs called "teams" will enroll in two concurrent 12-week I-Fund sessions set to start in fall 2017. The two groups of teams are "cohorts."
The website for this new Delta I-Fund is still in development.
Officials believe those teams will come from the 50 public and private universities and numerous entrepreneurial support organizations in the eight states.
The sessions, held mostly by virtual means such as video conferences rather than in-person, will include structured training and mentoring from professionals, plus the opportunity to collaborate with entrepreneurs on other teams.
Each team, selected by a five-person investment committee, will receive $5,000 upon acceptance into the program. A second-stage investment of $20,000 will be awarded mid-way through the session, based on the teams' pitch of their product or service. If the teams launch a company and reach milestones set by the program, they could receive another $25,000 at the end of the session.
So the teams could be awarded up to $50,000 each.
They can use the money for traveling to customers who might buy their innovative goods or services and other expenses that occur while preparing to launch a new business.
"At the end of the program, the goal is for those teams to decide we're either going to launch this company or we have done enough work on it where we need to go back and re-think some of our assumptions before we go further with it," Stinson said.
DRA Chairman Chris Masingill said the I-Fund means entrepreneurs and startups in the Delta region having "the technical assistance and the model and the know-how to actually be successful."
The I-Fund kicked off earlier this year with eight student-led startup businesses at five universities participating in a 12-week session. Stinson called that "a success by every measure." About half the teams launched new companies, he said.
Stinson said officials are unaware of any other program in the country that provides early-stage, proof-of-concept funding with structured training and private business partners. The I-Fund is also different because its type of funding is not available in rural America, they emphasized.
Senators John Boozman, R-Ark., and Richard Shelby, R-Ala., were listed among those who have endorsed the I-Fund.
