Kansas Center for Entrepreneurship Kansas Capital Multiplier Loan

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Kansas Center for Entrepreneurship Kansas Capital Multiplier Loan and Venture Funds Kansas City Lender

Kansas Center for Entrepreneurship Kansas Capital Multiplier Loan and Venture Funds Kansas City Lender Summit Federal Reserve Bank of Kansas City August 19, 2011 Presented By: Corey Mohn, Director of Statewide Programs Net. Work Kansas

Where We Are Today…

Where We Are Today…

…And What Used to Be Here

…And What Used to Be Here

Net. Work Kansas A Service of the Kansas Center for Entrepreneurship Principle Outcome/Our Priorities:

Net. Work Kansas A Service of the Kansas Center for Entrepreneurship Principle Outcome/Our Priorities: Establish an organization to accomplish the following: § Serve as a central portal to help connect entrepreneurs with public sector businessbuilding organizations § Increase availability of capital in rural areas § Assist regional and community organizations in providing seed funding for entrepreneurs § Promote business startups and expansions “Net. Work Kansas”

Net. Work Kansas Current Statewide Initiatives • Referral Center – Central portal of resources

Net. Work Kansas Current Statewide Initiatives • Referral Center – Central portal of resources for entrepreneurs • Start. Up Kansas – Statewide supplemental capital source in partnership with public and private lenders • Economic Gardening Pilot – High-level technical assistance and custom data for 2 nd stage businesses “Net. Work Kansas”

Net. Work Kansas State Small Business Credit Initiative (SSBCI) • $1. 5 billion nationwide

Net. Work Kansas State Small Business Credit Initiative (SSBCI) • $1. 5 billion nationwide to strengthen lending to small businesses (500 employees or less) • Matching program – 10 x leverage on private investment, including bank loans and applicant equity • All states eligible to apply for funding in 2011 “Net. Work Kansas”

Net. Work Kansas SSBCI in the State of Kansas • Kansas award announced June

Net. Work Kansas SSBCI in the State of Kansas • Kansas award announced June 2011 • $10. 5 million for the Kansas Capital Multiplier Loan Fund • $2. 6 million for the Kansas Capital Multiplier Venture Fund • Loan and Venture Funds administered by Net. Work Kansas in partnership with the Kansas Department of Commerce “Net. Work Kansas”

Net. Work Kansas Capital Multiplier Loan Fund • Loan minimum of $10 K and

Net. Work Kansas Capital Multiplier Loan Fund • Loan minimum of $10 K and max of $250 K on Multiplier portion (minimum total deal of approximately $111 K) • 9% match on private equity, including bank loans • Loan term is 5% up to 15 years • Currently accepting applications from Net. Work Kansas resource partners • Multiplier Loans will be subordinate to private capital and be administered by certified development companies who are Net. Work Kansas partners “Net. Work Kansas”

Net. Work Kansas Capital Multiplier Venture Fund • Investment minimum of $25 K and

Net. Work Kansas Capital Multiplier Venture Fund • Investment minimum of $25 K and max of $250 K on Multiplier portion (minimum total deal of approximately $278 K) • 9% match on private equity per round, including angel funds • Two applications have been approved: currently accepting applications from Net. Work Kansas resource partners “Net. Work Kansas”

Net. Work Kansas Capital Multiplier Process • Application submitted by funding partner at www.

Net. Work Kansas Capital Multiplier Process • Application submitted by funding partner at www. networkkansas. com • Financial Review Loan or Venture Board reviews the application and approves or denies funding • Capital Multiplier dollars provided to the business through the partner (loan deals) or directly to the business (venture deals) • Partner collects any loan payments and distributes Capital Multiplier portion back to Net. Work Kansas “Net. Work Kansas”

Net. Work Kansas Benefits to Lenders • Funds are subordinate to private capital •

Net. Work Kansas Benefits to Lenders • Funds are subordinate to private capital • Multiplier uses of funds include working capital, business acquisitions, and inventory financing among others • Closing costs are partially paid by Net. Work Kansas • Augments risk by providing avenues for capital beyond collateral (Example: Start. Up Kansas 62 bank loans, 1 failure) “Net. Work Kansas”

Net. Work Kansas A Service of the Kansas Center for Entrepreneurship NETWORK KANSAS •

Net. Work Kansas A Service of the Kansas Center for Entrepreneurship NETWORK KANSAS • 1 -877 -521 -8600 • www. networkkansas. com Corey Mohn 785 -296 -6611 cmohn@networkkansas. com