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Highlight: Regional Innovation Strategies Program Bolsters Economic Growth in Both Urban and Rural Opportunity Zones Across the U.S.

EDA’s Office of Innovation and Entrepreneurship (OIE) is currently working with a number of Regional Innovation Strategy Program grantees that are focused on creating Opportunity Zone investment funds for businesses, or funds that will support investment flow in Opportunity Zones and Opportunity Zone-related areas. These grantees are located in both urban and rural communities across the country:

  • In Philadelphia, Pennsylvania, Ben Franklin Technology Partners is creating, developing and launching the Greater PHL Opportunity Zones Seed Fund with a Seed Fund Support (SFS)" grant. The fund will allocate $15-$20 million to seed innovation-based companies with high potential for growth in qualified Opportunity Zones in the Greater Philadelphia region. The fund will provide needed capital and technical assistance and support to help companies grow and commercialize their products, and demonstrate the potential for growth and job creation.
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    Ben Franklin Technology Partners Logo

    Ben Franklin Technology Partners will also work with county industrial development authorities and corporations, private real estate developers, and anchor institutions to support the development of real estate in qualified Opportunity Zones to provide for co-working, incubator, and innovation space for start-up and growing tech-based companies. Over five years, Ben Franklin expects the fund to invest in 50-70 companies and support 200 jobs.

  • In Memphis, Tennessee, EpiCenter is working with local investor leadership to stand up new programs focused on increasing the “capital stack” in the region. Vibrant Memphis, Inc. will support the Memphis Region Capital Capacity (MRCC) project, which encapsulates the operations of two pools of de-risked capital, Formation Fund and Co-Investment Fund, deployed in support of early-stage entrepreneurs. In addition to direct fund management, Epicenter will use venture capital partners and industry leaders to recruit innovative companies along Memphis’ regional industry clusters as defined by the 2018 Mass Economics Target Industries Study.
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    Epicenter logo

    Most critically, MRCC will focus on retaining high-growth companies in the Memphis economy. Epicenter holistically and strategically supports an entrepreneurial ecosystem that nurtures entrepreneurs by ensuring access to talent, customers, and capital – all necessary supports for a thriving entrepreneurial movement. The MRCC and its related funds and activities work to build and nurture a dynamic capital stack, and in doing so, encourage more risk-taking behavior and larger risks from venture capital and angel investors alike. Finally, by filling the capital stack with diverse capital offerings, Epicenter continues to improve deal flow, therefore recruiting more dollars from outside the region into the companies that will most significantly impact Memphis.

  • The Center on Rural Innovation (CORI) is working with nine rural communities to collectively stand up an investment fund that will invest in rural Opportunity Zones. CORI will create and manage a seed fund of $2M+ that will make early-stage investments in promising startups that have been launched in rural Opportunity Zones.
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    CORI logo

    CORI anticipates that the Opportunity Fund designation will encourage more investor participation at a higher level of commitment due to the unique tax advantages offered by the structure as well as the limited time remaining in which investors can contribute. The portfolio will include a combination of convertible debt and equity investment which allows participation in company growth across differing business models and ensures that building an ecosystem remains a consistent part of our investment strategy.

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