Maine Economic Development Venture Capital Revolving Investment Program:

This program is designed to allow the State to invest as an equal partner with other eligible private venture capital funds to support emerging and early-growth businesses in Maine. It is intended to utilize experienced professional fund managers to increase the probability of successful investments in recipient companies.

Eligibility: Available only to established venture capital funds that have a strategy for the creation and retention of jobs in Maine through:

Investments in Maine high-growth businesses.

A marketing and technical assistance plan.

Appropriate monitoring of its investments.

A technical assistance program to assist the business in which it invests.

A process for complying with proposed measurement goals:

Investment Amount: Maximum investment of $1 million per fund.

 

Participating Venture Capital Funds:

The Borealis Fund, L. P.
Hanover, NH
603-643-1500
www.borealisventures.com
Brook Venture Fund II
Wakefield, MA
781-295-4000
www.brookventure.com
CEI Community Ventures, LLC
Portland , ME
207-772-5356
www.ceicommunityventures.com
Coastal Ventures II, LLC
Portland, ME
207-772-5356
www.ceiventures.com
Masthead Venture Partners Capital, L. P.
Portland, ME
207-780-0905
www.mvpartners.com
 

Contact: Finance Authority of Maine, 207-623-3263.
www.famemaine.com

 

Maine Seed Capital Tax Credit Program:

This program is designed to encourage equity and near-equity investments in eligible Maine businesses, directly and through private venture capital funds. FAME may authorize state income tax credits to investors for up to 60% of the cash equity they provide to eligible Maine business. Investments may be used for fixed assets, research or working capital.

Eligibility:

  • Businesses located in Maine.
  • Investors must collectively own less than an aggregate of 50% of the business.
  • Principal owners and their relatives are not eligible.
  • Annual gross sales of less than $3 million.
  • Business must either: 1) be a manufacturer; 2) provide goods or services with 60% of sales derived from outside the State or to out-of-state residents; 3) develop or apply advanced technologies; 4) bring significant permanent capital into the State.
  • Operating the business must be the professional, full time activity of the owners.

Basic Terms:

  • Tax credits equal to 40% of the investment (60% for investments made in high unemployment areas).
  • An investor may provide up to $500,000 per business.
  • Aggregate investment limit per business is $5 million for which credit may be received.
  • Investments must be at risk for 5 years.
  • Credits must be taken in increments of 25% (of the credit) per year commencing in the year of the investment. Credits used cannot exceed 50% of the total tax due by the investor for that taxable year before the application of the tax credit. To the extent this limitation requires the taxpayer to take the credit over more than 4 years, unused credits may be carried forward no more than 15 years.

Special Rules for Venture Capital Funds:

  • Investors may provide up to $1 million per venture in any consecutive 3 year period.
  • Investors in any one venture capital fund cannot receive more than $5 million in credits, but may invest more without credit.
  • Investors in certain qualifying venture capital funds may receive one-half of this credit (up to 20%) at the time of investment.
  • The remaining amount of an investor’s tax credit will be awarded when and if the venture capital fund invests sufficient monies in an eligible Maine business. Credits will be revoked if not substantiated within 3 years.
  • Investment into venture capital funds must be at risk and principal may not be paid without FAME consent for 5 years. Dividends,royalties, interest, stock options or warrants and other forms of return, which are not in the nature of return of principal, are allowed.

Reporting Requirements: businesses receiving investments for which credits are issued, must file annual reports with information on the total investments received, number of employees and jobs created/retained, annual payroll and total sales revenue. Failure to file reports will result in ineligibility and possible revocation of credits issued.

Contact: Finance Authority of Maine, 207-623-3263.
www.famemaine.com

 

Small Enterprise Growth Fund (SEGF)

Maine's Venture Capital FundThe SEGF was created by an act of the Maine Legislature in 1995 to provide Maine companies and entrepreneurs access to patient sources of venture capital. This revolving “evergreen” fund is a professionally managed venture capital fund that invests exclusively in Maine companies that demonstrate a potential for high growth and public benefit.

The fund that focuses exclusively on investing in promising growth companies in almost all industry sectors, with a potentialROI commensurate with risk. Applications will only be considered from companies that employ 50 or fewer people or have gross sales of $5,000,000or less and can demonstrate a co-investment equal to the investment amount sought from the SEGF.

Contact: Small Enterprise Growth Fund, (207) 373-9306
www.segfmaine.com

 

Maine Investment Exchange (MIX) Program

The Maine Investment Exchange (MIX) is a forum for entrepreneurs to present an overview of their business plan to an audienceofpotential investors i.e., providers of risk capital, a group typical comprised of venture capital, and private equity firms, that specialize in early-stage companies, and other qualified investors, e. g. “Angel Investors”. Presenting companies are pre-selected through an application process and are provided with an opportunity to make a brief formal presentation to the audience of investors with a further opportunitytonetwork with the investors and other interested parties that attend MIX events.

MIX is an enterprise created by Maine & Company and supported by private businesses throughout the state. MIX is overseen by an Advisory Board and is administered by Maine & Company. MIX is not engaged in selling, marketing, or promoting, in any way, the securitiesof any participant company. MIX recommends that entrepreneurs and investors alike undertake their own due diligence and encourages bothparties to seek legal and other professional counsel prior to entering into any agreements.

Contact: Maine & Co., 207-871-0234.
www.maineco.org