Up-and-coming Delaware small businesses will have a potential new source of capital to help them expand.
As part of National Small Business Week, May 5-11, the Division of Small Business on Monday launched a competitive, matching grant program to assist Delaware entrepreneurs who want to grow their small businesses.
Gov. John Carney along with Damian DeStefano, director of the Delaware Division of Small Business, which will administer the program, announced the new grants during a news conference at O’Connor Belting International in Newark.
EDGE — Encouraging Development, Growth & Expansion — Grants are designed to help newer small businesses level the playing field with larger, more established companies by providing a three-to-one match for each dollar the business spends on qualified expenses.
Small businesses account for 98% of all Delaware businesses and employ 55% of Delaware’s workforce. Helping those businesses find access to capital is a key element of Carney’s strategy for growing Delaware’s economy.
As many as 10 EDGE grants will be awarded in the first round of funding: five grants of up to $100,000 each for science/research-based businesses (STEM class) and five grants of up to $50,000 each for all other businesses (entrepreneur class).
Among other requirements, businesses eligible for EDGE must be less than 5 years old, with no more than 10 employees and be majority located in Delaware.
O’Connor Belting International started in 2011 and now employs 23 people. It specializes in the fabrication of lightweight custom conveyor belts. Paul O’Connor Sr., the company’s president, said OCBI could have benefitted from a program like this in its first years.
“A program like this would have been a real benefit to us,” said O’Connor. “This kind of access to money for major purchases or investments could certainly go a long way to maintaining positive cash flow, which is so important to a small business, especially early on.”
EDGE Grant funds must be spent on expenses that will improve a business’s chances for long-term success and help it rise to the next level.
Qualified expenses include acquiring real estate for use in the business; purchasing essential equipment; investing in website design; investing in marketing and advertising; and expenses related to prototyping a new product.
“The Council on Development Finance is excited for the EDGE Grant program,” said Fred Sears, CDF chair and part of the seven-member panel of small business and economic development experts that will select the grantees. “We are always looking for ways to better assist new small businesses. This will make money available to companies at a key stage in their development that will position them to be able to grow and expand their business in Delaware.”
The money for EDGE Grants comes from a federal government grant.
Grant applications are available at delbiz.com and are due June 14 for the first round of funding.