U.S. Senate Committee on Small Business & Entrepreneurship Ranking Member Ben Cardin (D-Md.) and U.S. Senator Mazie K. Hirono (D-Hawaii) have introduced legislation to invest in underserved innovators.
The bill would create an Innovation Centers Program within the Small Business Administration (SBA) to award competitive cooperative agreements worth as much as $400,000 annually to institutions that support underserved and low-income communities. Cardin introduced similar legislation in October 2019.
The Ushering Progress by Leveraging Innovation and Future Technology (UPLIFT) Act of 2021 will foster innovation and entrepreneurial ecosystems in low-income, rural, and other underserved communities by providing Historically Black Colleges and Universities (HBCU), minority-serving institutions (MSIs), and community colleges with the resources to establish and expand incubators and accelerators for underserved entrepreneurs.
“One of the lessons from the COVID-19 pandemic is that the federal government must play an active role in leveling the playing field for entrepreneurs in underserved, underbanked, and undercapitalized communities,” Cardin said. “The UPLIFT Act would leverage the unique role that HBCUs, MSIs, and community colleges play in their communities to foster innovation ecosystems in minority, rural, low-income, and other underserved communities.”
Historically, small business investment in this country has been uneven, more so for innovative businesses with high-growth potential. For example, less than 1 percent of all venture capital goes to rural businesses; around 2 percent goes to women-owned businesses, and only 1 percent goes to black- and Hispanic-owned businesses.
“The coronavirus pandemic has underscored the need to invest in underserved communities, which have been disproportionately impacted by COVID-19,” Hirono said. “The UPLIFT Act makes sure that the federal government plays an active role in supporting businesses from these communities by leveraging the resources of community colleges, Historically Black Colleges and Universities, and Minority Serving Institutions—including Native Hawaiian Serving Institutions. I cosponsored this important legislation because we must support these communities as part of our nation’s economic recovery.”
Incubators, accelerators, and other small business innovation models have a demonstrated track record of helping businesses reach their potential by providing intensive mentorship, networking opportunities, and access to capital.
The Innovation Centers Program would:
Prioritize inclusivity in innovation to ensure that groups currently underrepresented in high-growth industries get the support they need to be successful;
Establish new entrepreneurship ecosystems by using HBCUs, MSIs, and community colleges, which are critical to reaching minority, low-income, and rural populations, to foster entrepreneurship in their communities;
Expand SBA’s reach to the entrepreneurs who need its services the most; and
Enhance outcomes for underserved business owners by creating incubators, accelerators, and other small business innovation-focused models that have a demonstrated history of helping businesses become successful. The models will combine unique and intensive mentorship, networking, and sometimes funding opportunities to fill a gap in SBA’s current programming.
The bill has been endorsed by Bowie State University, the University of Maryland Eastern Shore, Small Business Majority, the Hispanic Association of Colleges and Universities (HACU), U.S. Black Chambers, and the Page 30 Coalition.