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Venture south blog 5 14 25
Educational
SSBCI: The $10B Opportunity Most Investors and Startups Don’t Know About
There aren’t many $10 billion opportunities hiding in plain sight. But for early-stage investors who are paying attention, the State Small Business Credit Initiative (SSBCI) might be one of the most overlooked (and powerful) resources available today.Originally launched in the wake of the 2008 financial crisis, SSBCI was designed to help small businesses weather economic disruption. Now in its second iteration (SSBCI 2.0), the program is back with a much bigger budget, a broader mandate, and, critically for angel investors, a stronger focus on equity investments and early-stage capital.That’s good news for investors in the Southeast. But here’s the catch: most people still haven’t heard of it.At VentureSouth, we believe investors shouldn’t need to read federal policy documents to understand where the next opportunity lies. So in this blog, we’re breaking down what SSBCI is, how it’s being implemented across different states, and how you can position yourself to take advantage of it without getting tangled in the bureaucracy. What is SSBCI?And why, as an investor, should you care about it? Let’s start with the basics: SSBCI is a federal program administered by the U.S. Department of the Treasury. Its goal is simple: get more capital into the hands of small businesses, particularly in underserved communities.SSBCI was first introduced in 2010 as part of the response to the Great Recession. At the time, it was a $1.5 billion program that focused mostly on helping states boost lending to small businesses through loan guarantees and credit support. The impact was solid, but limited. Fast forward to today: SSBCI 2.0 is a full-on reinvention funded through the American Rescue Plan Act.The new program has been supercharged with $10 billion and a much broader scope. For the first time, venture capital and equity investments are part of the mix, which means angel investors now have a seat at the table. That’s a big shift. For those of us focused on growing early-stage companies in the Southeast, it means more tools, more capital, and more collaboration with state programs that want to see young companies thrive. It also means that knowing how your state is deploying these funds could give you a front-row seat to the next great deal flow.Did You Know: As of December 2024, more than $2.2 billion in SSBCI funds had already been deployed across 89 jurisdictions. That’s an 18% increase over the previous quarter! The pace of deployment is accelerating, signaling stronger pipeline readiness and more opportunities coming online for early-stage investment.This time around, the government is going bigger and broader with not only $10 billion in funding but also a mandate to reach historically underserved communities, including women- and minority-owned businesses and rural areas.Here’s what’s different: FeatureSSBCI 1.0SSBCI 2.0Total Funding$1.5 billion$10 billionPrimary UseLoan programs (credit support)Loans and equity capitalEquity ParticipationRare and limited Stronger emphasis on VC and angel fundingTargeted Impact AreasGeneral small business support Underserved groups (minority, rural, disadvantaged) Flexibility for States ModerateHigh; states choose from fund-to-fund, direct, and hybrid For angel investors, that last line is key: each state gets to decide how to use its share of the money. Some states are deploying funds directly into venture funds. Others are co-investing alongside angels or creating entirely new vehicles to support early-stage equity. Currently, 36% of all SSBCI allocations – roughly $3.2 billion – are earmarked for equity or hybrid equity programs, including direct investments and fund investments. That’s a significant carve-out specifically designed to support angel and venture capital engagement​.What you need to know? SSBCI 2.0 opens doors that SSBCI 1.0 didn’t, especially for those of us investing in high-growth startups across the Southeast. One Program, Fifty Strategies: How States Are Using SSBCI FundsOne of the most interesting (and sometimes confusing) aspects of SSBCI 2.0 is that every state gets to design its own approach. That means your opportunity as an investor can look very different depending on where you’re based or where the startup is headquartered.Here are the three main models states are using: 1. Fund-to-FundSome states are allocating SSBCI dollars into existing or newly created venture capital funds. These funds then deploy capital into early-stage companies – sometimes directly, sometimes alongside angels. This model is especially promising for investors who are already plugged into fund networks.Example: North Carolina’s NC Rural Center is leveraging SSBCI funds to bolster both debt and equity options for small businesses, especially in underserved and rural communities. While not a direct venture capitalist fund, their equity-like instruments are designed to support growth-minded businesses.Example: North Carolina, South Carolina, and Georgia have all emerged as leading performers in SSBCI deployment. North Carolina has deployed over $109 million, South Carolina over $38 million, and Georgia over $54 million as of Q4 2024, placing them among the top 20 jurisdictions nationwide.  2. Direct to StartupIn this model, state agencies make investments directly into startups, often via matching programs that partner with angels or venture capital. The upside? More capital into the deal. The challenge? Navigating the bureaucracy to secure the match.Example: InvestSC in South Carolina has earmarked SSBCI funding to support equity investments through fund managers. That means if you’re co-investing with a participating fund, SSBCI capital may be working right alongside you. 3. Hybrid and Niche ProgramsSome states are blending models or focusing on specific sectors, like life sciences or advanced manufacturing. Others are creating niche tools, like revenue-based financing or technical assistance grants, that support the pipeline leading to investment-readiness.For investors, this variation creates both opportunity and complexity. Depending on where you’re active, you might find SSBCI funds being used to:De-risk your early-stage betsProvide follow-on capitalMatch your investment dollar-for-dollarOr in some cases, not be accessible at allThat’s why it pays to know how your state is using its SSBCI allocation, and how to plug in. Navigating the Patchwork: How to Find and Use Your State’s SSBCI ProgramWith every state running its own SSBCI strategy, the first step is knowing what your state is doing and who to talk to. Unfortunately, there’s no single hub that maps it all out clearly. But there are ways to get your bearings: Start Here:Check your state’s economic development or commerce department website. Most programs are housed there, even if they go by different names (like InvestSC or the NC Rural Center). The Treasury Department’s SSBCI page lists all 50 state programs and updates progress reports as funding gets deployed. Reach out to local funds, accelerators, or angel groups. They often have the inside scoop and may already be involved in matching programs or co-investment opportunities.Ask These Questions:Once you find your program, here are a few key questions to ask:Is this program using SSBCI for equity or just loans?Can angels or early-stage investors participate directly or through a fund?Are there matching incentives for private capital?What companies or sectors are being prioritized?Don’t Go It Alone:This is where your network comes in. VentureSouth members, for example, benefit from shared diligence, pooled capital, and a team that actively tracks trends like SSBCI. We also talk through these programs in depth on the Venture In the South Podcast (see Episode 166), so even if your state’s plan feels murky, you don’t have to figure it out solo.SSBCI isn’t a magic wand. But it can tip the scales, particularly in early-stage deals where every dollar (and risk buffer) counts. There’s A $10B Opportunity That Deserves Your AttentionSSBCI 2.0 is quietly reshaping the landscape for early-stage investing in America, especially across the Southeast. With $10 billion flowing through state-run programs, the investors who understand how to plug in stand to benefit the most.It’s not just about more capital in the system. It’s about lowering risk, expanding access, and strengthening the pipeline of promising startups. Whether your state is directing funds through venture capital, matching angel investments, or experimenting with hybrid models, SSBCI is a signal: smart capital is being invited to the table.At VentureSouth, we’re tracking these developments closely. We’re talking about them on the Venture In the South Podcast and unpacking what’s real, what’s noise, and what’s worth your attention. Because while SSBCI might sound like just another government acronym, we see it as something else: A chance to make money, have fun, and do good with a little help from a federal initiative most people haven’t even heard of.So if you're interested in investing in small companies in the Southeast and you plan to do it with clarity, community, and confidence, SSBCI is worth a closer look.
May 14, 2025
Venture south fallback
VentureSouth News
April 2025 monthly recap
April has been quite a month in the stock market. It’s less easy to see into opaque private markets, but it’s also been quite a month in the angel investing markets in the Southeast. Here’s the Vicinity Ventures April 2025 recap to give you a peek into what we’ve been working on.Investments: Big venture capital funds are making major bets on AI startups. Reflecting that national trend, VentureSouth members also made two big AI bets in April, investing over $1.2M in two rounds for AI-related companies. We don’t “break the news” of our companies’ investment rounds, but you’ll likely read more about these rounds as they are announced. We’re excited to invest in companies doing real things with AI here in our backyard.AI, though, represented less than half of our investments this month. VentureSouth members and funds invested over $2.4M in six companies (two new and four follow-on rounds) in total – not a bad pace of deployment for an angel group! In addition, Boyd Cycling successfully closed its community funding round, raising $589,550 from individuals across its “Vicinity” to fund continued expansion.Returns: As many tourist VCs and one-shot angels have painfully learned since 2021, deploying capital is only the first step; getting it back again is much harder!That is why we are particularly pleased that the last few weeks also saw VentureSouth members receiving proceeds from three companies – a bridge loan paying out interest, a prior-exited company releasing extra funds from a transaction escrow, and, most excitingly, over $3M returned as a long-standing portfolio company was acquired. Again, you’ll be reading more when the deal is announced, but (for now anonymous) congratulations to the team on a successful culmination of a LOT of hard work.Deals & Diligence: As usual, regardless of capital deployed or exits secured, work continues on new investment ideas, with four companies competing in the screening meeting at the beginning of the month, and two finishing the diligence gauntlet.Since the VentureSouth + Vicinity partnership was announced in February, you can begin exploring a subset of these investments yourself. Sign up for free at www.vicinityventures.vc or www.vicinitycapital.com to see the public deals, and upgrade to VentureSouth membership to see the menu exclusively available to VentureSouth members.Portfolio: Notable news from the portfolio in April included:A major partnership announced between Gradient Health and the Rajpurkar Lab in the Department of Biomedical Informatics at Harvard Medical SchoolBabylon Microfarms made it onto NBC when it covered the MSC World America’s maiden voyage (complete with two Microfarms)Baebies received FDA “breakthrough device” designation for the first point-of-care heparin monitoring assay.And more, including Darby adding a new CEO, Healthycell now being available on iHerb, and Atticus starting its new clinical trial for androgenic alopecia.If you prefer audio: David welcomed portfolio companies Gradient Health, Yuva, and Bublish onto the Venture in the South podcast. (Subscribe on Spotify or leave a review on Apple podcasts!)Meetings & Membership:We held angel investor meetings in Asheville, Greenville (twice!), Atlanta, Chattanooga, and online, and welcomed new members to our flock across the Southeast.We thanked our sponsors Insperity, Burr & Forman, and Rhodes Companies for their contributions to the VentureSouth angel investor community.Out & About:And we hit the road, of course! You might have seen Eric and Allen scrambling to meet Fran Tarkenton in Atlanta, Paul Newsom co-organizing the No Boundaries pitching competition in Aiken, or Charlie flying the flag in Ponte Vedra Beach with our Jacksonville angels.But not before getting out all the VentureSouth K-1s. K-1 Kudzu ran longer than we like, but all K-1s were out by April 15th. Now just waiting for my stragglers from non-VentureSouth investments, then I can file…Lastly, it’s hard to believe it, but April 2025 also saw the 10th anniversary of the first meeting of Lowcountry Angels, back in the misty distant past of April 2015. Time flies like a Mallard when you’re having fun.
May 5, 2025
Venture south fallback
Educational
More Than Making Money: How VentureSouth is Impacting the Community for Good
By Aubrey ZoodsmaWhen you hear the term “venture capital” you may think about businesspeople in suits, focused on the bottom line and building profits left and right. You probably don’t think about an angel investment network that leverages its connections to better their local communities and create a greater impact than just a dollar sign. But that’s precisely what VentureSouth is doing, and it’s something I’ve gotten hands-on experience with during my internship.I had the opportunity to work on one of these community projects with Carolina Women+ in Tech, a group for women and non-binary individuals in STEM, tech, and entrepreneurship fields. This chapter is just starting out in Greenville, SC, and was looking for some support. VentureSouth co-founder Paul Clark met with the Greenville chapter president, Samantha Cooks, to discuss what kind of assistance they needed. Based on that conversation, he felt that I would be a good point of contact for them, as a woman in a tech-centric field, and he connected us.When I later met with Cooks to help connect her to college students in the area, she told me how helpful the meeting had been. “Coming into Greenville as a remote worker, I didn’t have many professional connections. Paul helped us connect with local professionals in the tech field and gave us advice on how to grow,” she said.Since then, Carolina Women+ in Tech has hosted events, grown a larger support network, and added new members to their board. And they can’t wait to keep growing! “The chapter curator and board are excited to create a community for individuals that embrace the role tech plays in their careers, businesses, and lives,” said Cooks.  This is a great example of how VentureSouth uses its network to support small businesses in our communities, not just startups looking for seed money. But their investment doesn’t only strengthen local communities and economies; by choosing to invest in these startups, more job opportunities in our communities are created—something very much needed in uncertain economic times like these. In fact, all new net jobs in the United States can be attributed to startups like the ones VentureSouth invests in.And with VentureSouth’s partnership with Vicinity Capital, a capital-raising company focused on connecting locals with investment opportunities in the area around them, their impact will be even greater. Now called Vicinity Ventures, the partnership will allow a broader selection of local investment opportunities for both amateurs and accredited investors across the southeast.
April 30, 2025
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