Luis Alemañyz, president of the Puerto Rico Economic Development Bank, announces the new venture capital program as Lucy Crespo, CEO of the Puerto Rico Science, Technology and Research Trust, looks on.
The funding will support emerging and expanding companies in partnership with the Science, Technology and Research Trust.
The Puerto Rico Economic Development Bank (EDB) has secured a $30 million allocation from the U.S. Department of Treasury for investment in emerging and expanding companies. The funding will expand the “Boost Your Business” programs under the State Small Business Credit Initiative (SSBCI).
SSBCI was launched by the U.S. Treasury in 2010 and restored in 2021 as part of the American Rescue Plan Act (ARPA). Its goal is to provide capital to small businesses and startups to foster job creation and economic growth.
The EDB secured this allocation amid federal recognition for managing funds under the Community Development Block Grant-Disaster Recovery (CDBG-DR) programs and for “being one of the best and most efficient users of SSBCI funds,” EDB President Luis Alemañy said.
Through the EDB, Puerto Rico offers local entrepreneurs credit programs for financing in conjunction with a local bank or cooperative, support with collateral and participation loans. These programs executed by the EDB are now joined by the Venture Capital Access Program (VCAP).
The new program will be implemented with support from the Puerto Rico Science, Technology and Research Trust. The program will allow the EDB to invest in qualified companies that have already secured private capital and undergone a formal evaluation process.
The program will focus on private companies in early stages, including pre-seed, seed, bridge and Series A investment rounds.
Alemañy underscored the importance of the U.S. Treasury’s support.
“This Venture Capital Program will provide access to capital for entrepreneurs who are raising or have raised investment capital,” he said.
“With this program, we are supporting more companies in continuing their expansion by providing the necessary capital for growth. We will reinvest the $30 million constantly in other businesses once we start redeeming the investments, to support the creation of more businesses and jobs on the island.” Alemañy added.
Entrepreneurs participating in the EDB’s program will receive support and access to resources, including those from the parallel18 business support program, affiliated with the trust. Applications will be accepted starting on Aug. 7 here.
“For the Trust, administering this new EDB program, with funds designated by the U.S. Treasury, is a responsibility we undertake aligned with our mission to invest, facilitate and develop the necessary capabilities to continuously advance Puerto Rico’s economy and the well-being of its citizens,” said Science Trust CEO Lucy Crespo.
Selected entrepreneurs will have access to the parallel18 investor community through the Parallel18 Ventures subprogram. They will also receive technical assistance to expand their business, implement new verticals with the Parallel18 Connect program, support in business strategies and exclusive resources available to the parallel18 company community.
The performance of the companies will be monitored by the EDB, ensuring that the funds are invested according to existing federal Treasury guidelines. Investment decisions will be made by a seven-member committee, including two EDB representatives.
It is projected that the total investment by the EDB through the Venture Capital Program will be $30 million over the life of the program.
“This program will strengthen our local economy in the medium and long term and help high-risk companies that do not have access to or ease of traditional financing from commercial banks to grow their operations,” Alemañy emphasized. “We continue to demonstrate our commitment in creating a healthy investment environment that results in economic benefits for entrepreneurs on the island.”
Through the EDB, Puerto Rico offers local entrepreneurs credit programs for financing in conjunction with a local bank or cooperative: support with collateral and participation loans. These programs executed by the EDB are now joined by the Venture Capital Program (VCAP). SSBCI was launched by the federal Treasury in 2010 and restored in 2021 as part of the American Rescue Plan Act (ARPA). Its goal is to provide capital to small businesses and startups to foster job creation and economic growth.