Small Business Finance News
Manufacturing Added To Priority List For SBA Investment
Written by Tim Morral
SBA announces that advanced manufacturing will now be included in the list of funding targets for the Impact Investment Fund, raises $200M limit on funding.
The manufacturing sector received a piece of good news this week when the Small Business Administration (SBA) announced that it has added advanced manufacturing to the priority list for its Impact Investment Fund. Although the agency supports many government-backed loans to small businesses, the Impact Investment Fund is designed to support a range of social and financial goals.
Launched in 2011 as a five-year, $1 billion pilot program, the Impact Investment Fund was created to help finance impact investments, which are defined as investments in companies, organizations or funds for the purpose of achieving social and environmental goals, and generating a financial return.
Until now, funding targets for the Impact Investment Fund had been limited to businesses in underserved communities, clean energy or education. SmallBizTrends.com and other outlets have reported that with this announcement, advanced manufacturing companies are now eligible to be funded, improving access to capital for promising manufacturing firms.
"As head of the SBA, my main goal is to increase access to capital for our nation's entrepreneurs, especially to our underserved communities. This expansion of the Impact Investment Fund today puts more capital into the hands of entrepreneurs, while offering impact investors a tremendous platform to reach small business owners with innovative ideas," said SBA Administrator Maria Contreras-Sweet
Under the terms of the program, the SBA has been designating $200 million in SBA-backed debt to the fund. Capital from the fund is available to Small Business Investment Companies (SBICs) that are licensed for the program and invest at least half of their capital in impact investments.
The SBA also announced that Investment Impact SBICs will no longer be limited to a total of $200 million, enabling them to tap into the same amount of leverage as other SBICs.
These moves by the SBA reflect the success of the Impact Investment Fund pilot and underscore the SBA's commitment to continue the program beyond its initial 2016 timeframe.
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