While rural communities don’t always have the pre-existing angel networks of a tech hub like Boston, with the right approach, community leaders can identify potential investors and turn their passion for place into a launching pad for local startup growth.
Additionally, rural communities can band together to create deal flow, giving investors interested in supporting startups outside metro areas a strong opportunity to identify promising companies in places they might not otherwise have known. We’ve seen this firsthand through our work with the CORI Innovation Fund, where we’ve utilized the deal flow generated by our Rural Innovation Network to source more than a hundred promising tech-based startups.
How to start a seed fund
At CORI, we’re not just helping communities build their own strategies for finding access to capital: we’re providing some of that capital ourselves.
We do this through the CORI Innovation Fund, a Qualified Opportunity Fund that invests seed capital in promising rural entrepreneurs like Sho Rust of Sho.ai out of Cape Girardeau, Missouri. To date, CIF has made five investments in growth businesses all across the country, and has identified more than 100 rurals startups primed to scale and drive job creation in their communities.
Many rural communities might not think a seed fund is possible. But with help from public entities, it can be. CORI started our innovation fund with support and funding from the U.S. Economic Development Administration’s Regional Innovation Strategies program, which provided Seed Fund Support Grants to organizations all across the country. That funding was the reason we were able to cover the costs of a manager for the fund, charged with leading its operations, raising capital, and sourcing companies for investment.
The EDA program made our work possible, and has allowed our small targeted fund to invest in the rural communities that have seen so little venture capital, especially in the area of technology. Our fund was also synergistic with the EDA, given our focus on investing in Opportunity Zones which are a priority area for the EDA; rural communities can take this lesson of finding alignment when searching for funding themselves.
Stay in touch
To download our Rural Innovation Initiative community toolkit, which includes an assessment plan for your community’s Digital Drivers including Access to Capital, click here.