Venture capitalists are looking to Washington, D.C. for stimulus help. We’ve set their sights on the $60+ billion earmarked for secto
Freelance Writer, Business Insider
Venture capitalists are looking to Washington, D.C. for stimulus help.
We’ve set their sights on the $60+ billion earmarked for sectors widely invested in by venture-capital firms: environmentally clean technology, rural Internet broadband, cyber security, and health-care information technology. For some start-ups, venture investors say, money from the Obama administration could be the difference between survival and failure.
Government funds might be critical as venture capitalists risk running out of cash to pump into their stable of start-ups. Venture firms raised just $2.4 billion in the first quarter, down 64% from $6.6 billion a year earlier, according to research firm VentureSource.
Stimulus dollars can be the difference between a young company making it through the downturn or not. DigitalBridge say its business of providing wireless networks to smaller towns fits with the stimulus package's goal to extend rural broadband networks. The company is in the process of applying for $40 million to $50 million of stimulus money that would be used to deploy wireless networks in localities with fewer than 5,000 residents, says Chairman Bill Wallace.
Treasury Secretary Timothy Geithner announced rules that will allow developers of wind, solar, biomass, and other green energy projects to apply for a total of $3 billion in federal grants to cover upfront project costs. The funding, part of the American Recovery and Reinvestment Act, will be critical to boosting the fortunes of green industries like wind power.
Under Treasury Department guidelines, the Department of Energy will disburse cash grants worth 30% of upfront costs for projects that start construction by the end of 2010.