Statement of Support to Recapitalize the Vermont Seed Capital Fund

Due to COVID-19 impacts, there is acute demand for high risk, startup and scaling stage capital for Vermont's technology enabled businesses across most all sectors. The need is to retain and grow jobs, fund capital expansions, support growth and complete business pivots.

Angel, institutional and banking capital resources are lower, revoked or unavailable for many of Vermont's highest potential and highest paying firms. Additionally, some sources of capital have become predatory with investment or lending terms to the detriment of the companies and founding teams.

If the Legislature desires to prioritize support for startups and scaling firms like these to recovery and thrive, then a $10 million recapitalization of the existing Vermont Seed Capital Fund is strongly encouraged from the $1.25 Billion in CRF funding or from other state sources. The Fund is "shovel ready" to quickly and responsibly invest into eligible companies across Vermont.

Background: Formed during the 2009 financial crises by the Vermont Legislature and Governor, the Vermont Seed Capital Fund is managed by the Vermont Center for Emerging Technologies (VCET). This $5.1 million revolving capital fund has two public mission driven investors: VCET (a 501 c3) and the Vermont Economic Development Authority (VEDA). In addition to assisting the formation of scores of capital rounds for companies, the Fund has invested in 23 companies to date, but more capital today is necessary to continue this work if a Vermont priority. These 23 companies have cumulatively now:

• Raised over $182 million in capital (>40x capital leverage)
• Earned over $134 million in revenues
• Provided over $125 million in payroll
• $72,000 is the average Vermont wage.

Thank you for joining this this Statement of Support to show the Vermont Legislature and Governor that the technology enabled sector has capital access needs today to hire, grow and help Vermont recover from pandemic.