HB 286: Seed-Capital Fund; create a subfund to provide startup capital to certain small businesses; provisions

Georgia already has a Seed-Capital Fund, managed by a state-designated center, that provides equity and financing to help grow businesses in the state. This bill adds a new Code section creating a special subfund inside that larger fund, aimed specifically at helping small businesses connected to TCSG's small business education programs get off the ground. To qualify, a business must be at least 51 percent owned by a current student or graduate of a TCSG small business program, be in operation less than ten years, not be dominant in its field, and be doing innovative work in technology, manufacturing, or agriculture. The center, working with TCSG, would review applications that include a business plan, financial projections, and evidence the money is needed and will be used properly before approving startup capital. The bill also tweaks existing fund language about how uninvested money can be used while it sits idle.

• Creates a new small business innovation startup capital subfund inside the existing Seed-Capital Fund managed by the state center.
• Limits eligibility for subfund money to small businesses at least 51 percent owned by current students or graduates of a TCSG small business program.
• Requires businesses to be under ten years old, not dominant in their field, and engaged in innovative technology, manufacturing, or agriculture work to qualify.
• Requires a detailed application including a business plan, market analysis, financial projections, and proof of economic impact before the center and TCSG can approve funding.
• Directs the center and TCSG to jointly create guidelines and procedures for running the subfund.
• Revises existing fund language so uninvested money can be held under the broader authority of the whole chapter, not just for equity contributions or loans.

Small business owners who are current students or recent graduates of a Technical College System of Georgia small business program, especially those in technology, manufacturing, or agriculture. It also affects the state center that manages the Seed-Capital Fund and TCSG, which would jointly review applications and administer the new subfund.

Eligible entrepreneurs connected to TCSG programs would gain a dedicated source of startup money, separate from the general Seed-Capital Fund, specifically meant to cover costs of launching and running a new business. Businesses that do not meet the ownership, age, or industry criteria would not qualify for this particular pool of funding.

• Section 1 revises O.C.G.A. § 10-10-3 so that uninvested fund money can be used under the broader authority of the chapter rather than being limited to equity contributions or loans.
• Section 2 adds a new O.C.G.A. § 10-10-8 creating the small business innovation startup capital subfund, funded by gifts, grants, donations, and government funds, with interest credited back to the subfund.
• Section 2 defines a qualifying 'small business' as at least 51 percent owned by a program entrepreneur, under ten years old, not dominant in its field, and engaged in innovative technology, manufacturing, or agriculture work.
• Section 2 requires applicants to submit a business plan, funding use statement, economic impact statement, and innovation statement, subject to approval by the center and TCSG.
• Section 2 requires the center and TCSG to find that the funding is needed, the business has a reasonable chance of success, and founders have made a substantial commitment before approving startup capital.
• Section 2 directs the center and TCSG to jointly establish guidelines and procedures for administering the subfund.
• Section 3 repeals any conflicting laws.

1. 2025-02-10House Second Readers (House)
2. 2025-02-06House First Readers (House)
3. 2025-02-05House Hopper (House)

• Yasmin Neal (D, HD-079)Primary sponsor
• Alan Powell (R, HD-033)
• Kasey Carpenter (R, HD-004)
• Ron Stephens (R, HD-164)
• Matthew Gambill (R, HD-015)
• Doreen Carter (D, HD-093)

• small business funding
• startup capital
• technical college system
• economic development
• state grants