PORTLAND

New fund targets investment in tri-county economy

By Carol Coultas

Business Writer

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A new pool of money is available to help tri-county businesses expand and develop new products.

More than $10 million in equity funds and $3 million in operational assistance money is available under a new program targeting northern New England and offered by Coastal Enterprises Inc. The bulk of the money, however, is expected to be used in Maine.

Called CCVI, the CEI Community Ventures program will encourage business growth and employment opportunities in low-income communities. Among the areas targeted are the downtowns of Lewiston and Auburn, portions of Norway, Byron, Mexico and Rumford, and all of Franklin County.

“We’re looking to invest in opportunities that are below the radar screen for typical venture capital,” said Michael Gurau, president of the CCVI. “We’re blending economic development with venture capital funds.”

Venture capital is typically available to technology businesses located in urban areas. This fund is different in that CCVI seeks to invest in a cross-section of companies (technical, manufacturing, service) in rural or urban settings that are trying to expand or develop new products but lack the capital. There must be some social benefit connected to the investment, such as providing job opportunities in low-income areas, helping minority-owned businesses or enhancing environmental sustainability.

A complete list of criteria and application information is available at the CCVI Web site, www.ceicommunityventures.com

“This is a tremendous opportunity,” said Chip Morrison, president of the Androscoggin County Chamber of Commerce. “There is a lot of activity in both downtowns and lots of prospects the cities are working on right now. This will be a tremendous asset.”

Scott Christiansen, executive director of the River Valley Growth Council, also welcomed the news.

“I’ve found venture capital is difficult to pull into western Maine,” he said. “This is a fund we’ve been watching. Knowing that the funds have been secured and are available ... (is) going to make a difference.”

Christiansen said it’s likely the CCVI money could be used in the growth council’s on-going pyrolysis project. Pyrolysis involves subjecting finely ground wood to intense heat; the result is a mixture of oil, carbon and other gases. The oil can be refined into products like plastic and fabric or processed further into hydrogen.

“Once we have demonstrated the viability of the pyrolysis project, this is the sort of thing we’re likely to partner on,” he said.

Gurau said the operational assistance money allows the fund to do more than simply provide equity funds. For instance, if a business with a good product but no business plan is eligible for operational assistance, CCVI would pay to hire a consultant and draft a business plan for that company.

“We’re trying to help entrepreneurs by providing more than equity,” said Gurau. “We’re trying to give them additional resources.”

Alison Hagerstrom, executive director of Greater Franklin Development Corp., said venture capital is welcome in Franklin County.

“This is a good opportunity for us,” she said. Currently she is working on a project involving recreation and tourism that could benefit from the CCVI program. She said she hopes to spread the news and that other businesses will take advantage of it.

CCVI, a for-profit subsidiary of CEI, is one of only seven projects co-funded by the Small Business Administration to target specific geographic areas in the U.S. It seeks a balance of financial, social and environmental returns on its investments. CCVI received approval from the SBA in April.

ccoultas@sunjournal.com

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