CEDAR RAPIDS, IA—OCTOBER 10, 2012—AccelerateIT, LLC, a local fund management group, announces the formation of Iowa Seed Fund II (ISF II) LLC, a $3M seed-stage investment fund focused on the creation and growth of Iowa businesses. The fund was raised over the past year from area businesses and individuals strongly committed to the growth of Iowa’s Creative Corridor communities. Like the original Iowa Seed Fund (formed in 2007), ISF II investments will focus on start-up to early-stage Iowa businesses that have strong growth opportunities, solid business plans, and qualified talent.
“Start-up and early-stage capital is critical to the growth of new enterprise,” said Curtis Nelson, manager of AccelerateIT, LLC and EDC, Inc. President and CEO. “Nationally, 75% to 85% of new businesses looking for such capital fail to find it on an annual basis, so the ability to provide investment in our region through this fund, and collaboration with other funds in Iowa, is a key component to building a stronger entrepreneurial community.”
AccelerateIT works in tandem with EDC, Inc., a Cedar Rapids-based business accelerator, to provide mentoring and assistance for area entrepreneurs to get them to a level where they are prepared to take on investors. EDC has worked with several entrepreneurs to develop their businesses from the idea stage to commercialized, scalable businesses. ISF II is designed to fill a gap in early-stage funding, to make equity investments in Iowa’s interstate commerce, high-growth potential companies and to serve as a catalyst for investments by others in these companies.
Nelson added that this has been a recognized need since EDC was founded nine years ago. “Once the entrepreneurs tap out the funds available via friends and family, there just aren’t an abundance of resources to help them perform feasibility research, create prototypes or cover early marketing or operational expenses,” said Nelson. “It’s our hope that the combination of our mentoring program and more of the necessary resources, such as this fund, will make Iowa’s entrepreneurs increasingly successful.”
ISF II is a Qualified Community Seed Fund as defined by House File 2271, which allows investors / investments to receive a 20% state tax credit. This program was created in 2002 to stimulate Iowa’s investment in new business creation. Qualified Community Seed Funds can raise up to $3 million per fund.
About EDC, Inc.
The Entrepreneurial Development Center was incorporated in 2003 as a community-sponsored, non-profit business accelerator. The company provides economic growth through the development and expansion of entrepreneurial enterprises and has successfully assisted over 500 Iowa-headquartered businesses. Its focus is on creating local wealth for area re-investment by growing and cultivating regional, national, and international businesses.