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Created in 1986 by a partnership of local individuals and The McKnight Foundation, the Initiative Foundation is one of six Minnesota Initiative Foundations (MIFs) serving greater Minnesota. The MIFs were originally formed to address economic issues related to rural flight, poverty and downtown decline, which were prevalent during the mid-1980s. The Initiative Foundation offers the following business financing programs to meet diverse regional needs: Business Loans, Technology Business Loans, Green Business Loans, Small Business Loan Guaranties, and Seed Investments. The Foundation prioritizes technology-based and green businesses as well as value-added manufacturing and agriculture operations. Nontraditional business owners such as women and minorities are especially encouraged to apply. The Foundation operates a Seed Capital Fund, designed to advance emerging entrepreneurial ventures by financing product concept, development and market research. Preference is given to projects exhibiting potential for substantial growth through the introduction of new products and services. In return for Seed Capital Fund investments, the Initiative Foundation may negotiate company equity or royalties that reflect the incurred risk. For business start-up and expansion projects, Initiative Foundation business financing programs meet the 'gap' between the financing a local lender is able to provide and the equity the owner is able to contribute. Financial participation by a local lender is required. The Seed Capital fund's maximum investment amount is $50,000 per investment. Since its inception, Initiative Foundation invested more than $55.1 million in the region through targeted grants and business financing investments. In 2010, the Foundation also received a $750,000 CDFI grant to support the Technology & Green Loan Funds. The Foundation will loan up to $500,000 for value-added agriculture and manufacturing companies that bring new revenue to communities. $45 million in outside capital has been leveraged through 39 loans.
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