What is Fund Tennessee?

Over the next decade, Fund Tennessee will administer $117 million in federal funding to Tennessee small businesses and entrepreneurs as part of the U.S. Department of the Treasury’s SSBCI (State Small Business and Credit Initiative) program. Fund Tennessee is comprised of InvestTN, the equity component; LendTN, the debt program; and AssistTN, for technical assistance. We believe Tennessee is better when its business community – across all 95 counties – is empowered to grow, create jobs, and transform communities.

Whether your business seeks equity investments, lending or technical assistance, Fund Tennessee is here to provide equitable access to capital so your business can continue to succeed in The Volunteer State.

Equitable access to capital.

No matter where you are in your business journey, you have options for getting funds and support best suited for your situation.

The right infusion of funds at the right time.

With both equity investment and lending options available to people in all 95 Tennessee counties, Fund Tennessee provides fair access to funds.

Resources to get your business capital-ready.

Tennessee small business owners take care of each other and their employees. With access to funds, they are positioned to create jobs that support a living wage, benefits and career advancement.

The program is made up of 3 parts

1

InvestTN

Led by Launch Tennessee’s capital team, InvestTN is a new collection of funds for early-stage startups and venture funds seeking to raise capital. InvestTN will provide Tennessee-based small businesses with a unique resource to grow and scale.

A total of $70 million will be distributed across Tennessee’s entrepreneur ecosystem over 10 years. If you’re an early-stage startup looking to raise equity at the Pre-Seed, Seed, Series A, or B stages, you could receive an initial investment ranging from $25,000 to $3 million. And if you’re a venture capital fund interested in investing in early-stage startups, you may be eligible for $1 to $3 million in capital commitments for the initial closings of new funds raised.

Learn more about InvestTN
2

LendTN

With lending options available to people in all 95 Tennessee counties, LendTN will provide fair access to funds whether you need to purchase new equipment or secure that next commercial property. A total of $47 million will be distributed across Tennessee’s entrepreneur ecosystem over 10 years.

Our team is currently selecting a growing list of leading CDFIs (Community Development Financial Institutions) to participate and these organizations are dedicated to supporting the growth of small businesses and startups in under-resourced communities.

Participating CDFIs will offer a range of financial products and services designed to help entrepreneurs access the capital they need to scale their businesses, create high-quality jobs and make a positive economic impact in Tennessee communities.

Learn more about LendTN
3

AssistTN

Securing funding for your business is just one piece of the puzzle. That’s we are committed to helping to ensure you have the right information to make an informed decision regarding the Fund Tennessee funding options. AssistTN will help you on this journey from legal and accounting to fiscal advisory services.

We’ve partnered with TSBDC (Tennessee Small Business Development Center) to offer comprehensive support to entrepreneurs seeking resources beyond LendTN and InvestTN. With their guidance, you’ll have access to the expertise and knowledge necessary to make informed decisions about your business’s trajectory.

Learn more about AssistTN

$117M

In Federal Funding

140

Targeted Equity Investments

52%

of Fund to SEDIs

1:1

Private Match Required

Frequently Asked Questions FAQs

As Fund Tennessee prepares to deploy equitable access to capital throughout our state, our team is working hard to provide a growing list of resources to address frequently asked questions about InvestTN, LendTN, AssistTN, and other critical aspects of Tennessee's entrepreneur ecosystem. Whether you're a startup or venture fund, this section will provide you with the information you need to make informed decisions about how Fund Tennessee can help you succeed.

Q: I keep hearing the acronym SSBCI — what does that mean?

A: SSBCI stands for State Small Business Credit Initiative. The American Rescue Plan Act of 2021 reauthorized and expanded the State Small Business Credit Initiative Program, which was originally established in 2010.

The program provides a combined $10 billion to states to expand access to capital for small businesses emerging from the pandemic. The goal of the program is to boost opportunity, entrepreneurship and create high-quality jobs.

The U.S. Department of Treasury announced Tennessee’s funding on Feb. 27. Those funds go from the federal government to the Tennessee Department of Economic and Community Development. TNECD and LaunchTN will deploy those funds.

Q: What does SEDI mean?

A: SEDI is a government acronym that stands for socially and economically disadvantaged individuals. Fifty-two percent of Fund Tennessee’s $117 million in federal funding must go to SEDI businesses.

SEDI businesses are owned or controlled by individuals who have had limited access to credit on reasonable terms including members of a group subjected to racial or ethnic prejudice in American society, gender, veteran status, limited English proficiency, disability, long-term residence in a location isolated from mainstream American society, long-term residence in a rural community, residence in a community undergoing economic transitions (including communities impacted by shift to net-zero) or membership in an underserved community.

Businesses also have SEDI classification they are located in Community Development Financial Institution (CDFI) Investment Area or will locate in one.

Q: What do these terms mean? “Pre-Seed, Seed, Series A, Series B”

A: As a business becomes more mature, it advances through funding “rounds,” raising different amounts of money as it grows.

Pre-seed is the earliest stage of investment, and generally includes self-funding, plus capital from family and friends. Seed funding is usually the first equity funding stage and it funds first steps, which could include market research or product development. When a company demonstrates product-market fit, they generally raise their Series A round. And to take the company to the next level, a company moves to Series B.

Q: What is the difference between equity and debt?

A: Debt involves borrowing money. Generally, in the instance of Fund Tennessee, debt would mean getting a loan from one of the partner CDFIs.

Equity is when a company sells a stake in its company in return for capital investment. For InvestTN, an equity investment would take varying forms depending on what “bucket” it’s a part of — the Regional Seed Fund, Technology Fund or Multi-Fund.

Q: Are you doing anything to support founders who take InvestTN capital?

A: LaunchTN is building out a statewide expert network who will be able to answer the obscure questions entrepreneurs have. The organization is also building a perks database for founders, which will include deals and discounts on items, such as Google Cloud or Hubspot software, needed to thrive in business.

Q: What does a 1-to-1 match mean?

A: SSBCI is designed to use private dollars to magnify its results. Every $1 of capital from Fund Tennessee, must be matched at least with $1 of private capital.

Q: What is the current investing landscape in Tennessee?

A: Access to capital is one of the state’s greatest challenges. Access to capital is also a critical component to running or growing a thriving business.

Q: Is Fund Tennessee a grant program?

A: No. This is a debt and equity program.

Q: What is a VSB?

A: Very Small Business. It is a business that has less than 10 employees. A portion of SSBCI dollars are for VSBs.

Q: How long will the Fund Tennessee program last?

A: Fund Tennessee is intended to run for 8 to 10 years.

Q: If I want to learn more about the program, where should I look?

For additional information on the federal program, visit the U.S. Department of the Treasury website.

Does my business qualify?

We believe access to equitable capital is the key to helping businesses succeed across The Volunteer State. Whether you need equity investments, lending, or technical assistance, Fund Tennessee is committed to providing businesses with the resources they need to thrive.

Find out if you qualify