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$10M Fund Launched to Support New York-Based Startups and Early-Stage Companies

Posted on by darion

Gov. Kathy Hochul announced the launch of the Main Street Capital Program, a $10 million fund designed to provide affordable loans to New York startups and early-stage companies. The initiative, part of a broader statewide program State Small Business Credit Initiative Led by Empire State Development, it will offer qualifying entrepreneurs loans of up to $100,000 with flexible repayment terms designed to ease the financial pressures of early-stage growth.

“New York businesses are the backbone of our economy,” Hochul said. “The Main Street Capital program will help strengthen small businesses, especially those owned by minorities and women, by creating jobs and driving investment across the state.”

The new program addresses a critical need for many entrepreneurs who struggle to secure financing early in their business development. The Main Street Capital Loan Fund provides a more accessible lending option, especially for businesses owned by socially and economically disadvantaged individuals (SEDI) and very small businesses (VSBs) with fewer than 10 employees.

The loans, which have a six-year term with a fixed interest rate of 9.9%, will offer lower first-year payments, giving businesses the flexibility to focus on growth. Borrowers will pay less than interest for the first 12 months, with no principal repayments during that time.

The fund is a partnership between Empire State Development and Pursuit, a community lender with a 70-year history of supporting New York City businesses. Chris Levy, CEO of Pursuit, expressed enthusiasm for the initiative, noting that it provides “flexible capital and advisory services to support the long-term success” of New York City’s smallest businesses.

State officials have emphasized the program’s potential to benefit underrepresented entrepreneurs. “The Main Street Capital program is one way Empire State Development is helping startups access the tools they need to grow and succeed,” said Hope Knight, president and CEO of Empire State Development.

Because available financing options are often limited for minority-, women- and disadvantaged-owned businesses, the program is designed to offer an inclusive path to economic success.

Startups and early-stage companies interested in the program must complete a questionnaire before applying. Based on their responses, they may be invited to submit a full application or referred to local Entrepreneurial Assistance Centers (EACs) or Small Business Development Centers (SBDCs) for additional support.

These loans are part of New York’s broader strategy to support small businesses by State Small Business Credit Initiative (SSBCI)Funded with more than $500 million in federal aid from the American Rescue Plan Act, these funds are intended to help small businesses, especially those impacted by the economic fallout of COVID-19, recover and thrive in the post-pandemic economy.

The Main Street Capital Program builds on Governor Hochul’s commitment to supporting small businesses. Small Business Month in May, it unveiled several initiatives, including a $6 million innovation grant program to help companies apply for federal funding.

Finger Lakes Partners (Billboard)Finger Lakes Partners (Billboard)

Hochul also announced that New York has exceeded its fiscal year 2023 Minority and Women-Owned Business Enterprise (MWBE) utilization goals, awarding nearly $3 billion in state contracts to MWBE firms and achieving the highest MWBE utilization rate in the nation for the third consecutive year.

State Senator Sean Ryan stressed the importance of supporting small businesses in their early stages. “This program will help early entrepreneurs get established and keep young businesses on track,” Ryan said.

Assemblyman Albert Stirpe Jr. echoed those sentiments, pointing out that the program’s focus on providing affordable loans and support to businesses owned by socially and economically disadvantaged individuals is a vital resource for New York’s business community.

In addition to financial assistance, New York offers a range of support services for small business owners. The Department of Labor provides free consultations, employee recruitment assistance, and guidance on tax breaks and hiring incentives to help small businesses grow.

Hochul emphasized that New York’s 695,000 small businesses, which employ more than 4.5 million people, are critical to the state’s economy. The state’s continued investment in workforce development and small business initiatives will ensure that these businesses remain a key engine of economic growth.