The Pre-Seed Builder Fund is offering $50,000 in funding for early-stage entrepreneurs in Maryland, as well as eight months of formal programming. The idea is to provide both financial and operational support for companies who are socially or economically disadvantaged, and it turn create more startups in the state that receive follow-on funding and ultimately achieve success.
It comes amid a broadening effort to address wide disparities in venture funding. On a nationwide level, data shows that less than one-percent of venture funding goes to African American–led startups, less than one percent goes to Latinx entrepreneurs, while less than 2.5 percent of venture funding goes to women-founded startups.
TEDCO has been revamping its programming over the last two years, and the effort started with a look at diversity. Last year it piloted the Minority Business Pre-Seed Fund, which provided funding to African American entrepreneurs. In all, the program provided ten entrepreneurs with $40,000 each. The new program looks to build on that effort by increasing funding and opening up opportunity to more groups. The agency plans to make investments in two cohorts of 10 companies over the next year.
“The [Pre-Seed] Builder Fund is now the program that should be long-standing at TEDCO,” said TEDCO’s Mac Conwell, who is co-managing the fund with Angela Singleton. “All of these great things that we’re talking about now have come out of key learnings after the first year of running the pilot.”
Along with the increased funding, TEDCO leaders are also bringing in elements of its Loaned Executive Program, which has been a popular program with portfolio companies. Through this element of the program, TEDCO is connecting startups with experienced executives who will work with the companies to reach their next fundable milestones, said Singleton.
The program also includes two, 12-week intensive programs. The programming will offer education and operational support. Each will be customized for the companies based on their needs. The agency is accepting applications for the initial cohort through July 15.