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Pittsburgh Puts Stimulus to Work as Early-Stage Funds to Fill Capital Gaps

April 28, 2009

As credit and early-stage investment capital become increasingly scarce, more state, regional and local governments and organizations are stepping in to help local entrepreneurs get their companies off the ground. In many cases, offering equity investments is not always an attractive option to the public organization.

Pittsburgh's Urban Redevelopment Authority (URA), for example, recently announced a new low-interest loan fund to provide the early-stage capital needed to start new high-tech businesses in the midst of a troubled economic situation. The Pittsburgh Entrepreneur Fund will award up to $200,000 to high-tech entrepreneurs and companies, as well as pair awardees up with organizations that can offer guidance and technical assistance. Mayor Luke Ravenstahl noted that the program is not just for existing companies, but also is targeted toward young entrepreneurs and researchers who might otherwise take their intellectual capital elsewhere.

Low interest loans will be available for high-tech startups, particularly those involved in information technology, life science and green/energy. URA will work with local incubators to provide additional support for new and existing tenants.

The revolving loan fund has been seeded by a $1 million commitment, half from the city's Community Development Block Grant fund and half from federal economic stimulus funding. An article in the Pittsburgh Post-Gazette suggests the program's funding could double in the near future. Mayor Ravenstahl expects the fund to create more than 100 new jobs and leverage at least $3 million in private investment.

Read more about the Pittsburgh Entrepreneurship Fund at: http://www.ura.org/