At OEDIT, we know that Colorado businesses have the power to change the world—and not just large companies whose names everyone knows or those located in our largest metro areas. Across the state, entrepreneurs look at everyday life and see opportunity. They invent new products and introduce services that improve daily lives and fill gaps in the way Coloradans do business.
Three Durango-based businesses exemplify this kind of forward-thinking, solution-oriented innovation. Impact Fenders redesigned boat fenders to be easier to use and multi-purpose. Solvent Herba introduced a payment processing platform that is helping the cannabis industry serve its customers. And the Local News Network is pioneering the production of local news in underserved communities.
They’re also united by another important factor that we’re pretty proud of: with assistance from the Southwest Colorado Accelerator Program for Entrepreneurs (SCAPE), they applied for and were awarded Early-Stage Capital and Retention grants through the Global Business Division’s Advanced Industries Accelerator (AIA) Program at OEDIT.
These grants provide up to $250,000 to businesses commercializing innovative and disruptive technologies in the advanced industries that will be created or manufactured in Colorado. According to Rama Haris, Advanced Industries Senior Program Manager at OEDIT, most rural grantees have worked in the industries of advanced manufacturing and technology and information.
How SCAPE and the Early-Stage Capital and Retention Grants Help Companies Grow
While advanced industries businesses and technologies have the potential to transform communities and the world, the development and commercialization of innovative technologies requires significant investment. Private industry, however, is unwilling to make those investments until the technology has been de-risked and the business model and ability to scale has been proven. The goal of the grant program is to fill that gap with non-dilutive funding at a stage when it can be difficult to attract investment.
“This grant helps early stage companies get over what’s known as the ‘valley of death,’” Haris explains. “Oftentimes companies that go through our program are just too early in the development process to attract investors, but they need that funding to scale. The State’s investment provides a bridge until they are able to get that additional investment.”
Because the grant is known for its highly-vetted application and award process, grantees are often able to leverage it to attract “follow-on” capital in the form of an angel or venture capital investment or federal grants.
In the Four Corners area of Colorado, SCAPE has helped 12 businesses obtain the funding, which has directly led to business growth, job development, and private investor participation.
“Rural Colorado does not have as much investment activity as urban hubs around the nation, and this program has been an effective resource that helps growth companies scale. Investors appreciate the due diligence that the review process requires and they have used it as a catalyst to invest alongside the State's contribution,” says SCAPE Executive Director, Elizabeth Marsh.
She and SCAPE staff have seen firsthand the impact that comes with helping rural businesses grow. In nine years of operation, SCAPE companies have raised over $33 million to create 200 jobs in Southwest Colorado.
A Closer Look Three Durango Recipients of OEDIT’s Early-Stage Capital and Retention Grants
Rama and OEDIT staff recently visited three of those Durango companies, along with SCAPE, to celebrate their grant awards and the progress they’ve made. Here’s a closer look at each:
As the company story goes, a windy day on the water led the founders of Impact Fenders to realize that everything in boating had evolved—except fenders. The old, cylindrical models were awkward to use, took up a lot of space on the boat and had only one use. Impact Fenders came up with a flat (and sometimes flexible) design so they don’t roll out of the way on contact, are easier to stow and can be used in more ways than one. The company’s fenders double as knee pads, backrests, and even toy floats.
An Early-Stage Capital and Retention Grant helped the company scale its business model. According to Courtney Gates, Co-Founder and COO, “It enabled us to hire local staff, buy necessary equipment, and allowed us to invest in and run our business knowing we had the funds each month. This 'breathing room' is also allowing us to apply our patented design functionality and sensibilities into new lateral markets, like ski resort protective padding, boat lift pads, and protective pads for parks and sports fields.”
That peace of mind is something that Matt Ozvat, CEO of Solvent, and Jerrice Sanderson, COO, can relate to. Solvent was awarded a grant for its payment solutions platform, currently marketed toward cannabis related merchants. It allowed the company to hire three additional staff, with plans for more, and gave the whole team a greater sense of stability. That in turn led to greater productivity without a ton of extra hours.
“It’s such a refreshing lift to have actual breathing room for our employees. They can perform better without the extra stress,” Ozvat said.
Jerrice Sanderson, COO at Solvent, added that the grant also helped the company maintain its commitment to hiring within the local Durango community.
“We hire people with face-to-face customer service experience in our tourist town rather than looking for people with industry experience. We are focused on having a healthy work/life balance and offer good paying jobs with benefits, where some of the local tourist related businesses are not in position to offer those things,” Sanderson said.
Local News Network
Media tech startup Local News Network is pioneering a new model to bring local news and local business advertising to what it recognizes as underserved communities with little or no local news. The company produces and distributes free short videos news stories that are relevant for the communities they serve. It also provides area businesses with a platform to easily, affordably and effectively reach prospects and customers.
According to Laurie Sigillito, the Early-Stage Capital and Retention grant has allowed the Local News Network to grow from two to four locations, hire four new employees and produce over 500 hyper local news stories about businesses, events and other community information.
“We have brought local money into our local communities that was otherwise being spent with Google and Facebook. This is a huge benefit to rural communities,” Sigillito said. “Secondarily, the grant gave us the opportunity to refine our value proposition and perfect our investor pitch, and learning valuable fundraising lessons. We now have a better sense of the right type of investment to help you grow and stay on mission.”
For more information on the Early Stage Capital and Retention grant, visit https://oedit.colorado.gov/advanced-industries-early-stage-capital-retention-grant or contact Rama Haris.
Application Tips from Grant Recipients
Having been through the application process and received the grant, Solvent Herba, Local News Network and Impact Fenders offered the following advice:
- The process itself is a learning experience. Applying can help you strengthen your business model and strategy for longer, more meaningful growth that you can manage.
- If you are on the Western Slope, definitely apply. This program offers support for the whole state, not just the Front Range!
- Really listen to all the advice business accelerators like SCAPE offer throughout the process. It is invaluable and fantastic to have a community on your side as a growing business.
- The benefits go beyond the grant itself. Having support from the State of Colorado lends credibility to your business and improves your ability to attract additional investments.