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Mercer County Executive Brian Hughes on Tuesday announced the launch of Mercer County’s new Small Business Investment Program to help small businesses raise funding directly through retail investors in their communities and nationwide.
Through a competitive bid process, the county selected SMBX, an online marketplace that will connect small businesses and everyday investors, to run the program.
Mercer County has set aside $500,000 in American Rescue Plan Act funding to manage the program and drive retail investment to at least 30 Mercer County small businesses on the SMBX marketplace.
How the program will work
Businesses can raise money by issuing Small Business Bonds on the SMBX marketplace.
Instead of borrowing from a bank, businesses borrow from investors in their community and across the country, paying them back monthly at fixed interest rates through SMBX.
Small businesses are not required to provide a personal loan guarantee.
SMBX completes the underwriting at no cost, the business reviews it, and SMBX files it with federal regulators.
The SMBX marketing team works with the business owners to offer and promote their raise.
Once the raise is completed, the business makes monthly fixed payments to its investors so it knows exactly what to expect for its cash flow.
By purchasing Small Business Bonds in $10 increments through the Mercer County Small Business Investment Program, investors can earn a monthly return by lending money to their favorite local small businesses while gaining more control over their money.
The funds will keep the program free for small businesses.
“Mercer County continues to invest in our small-business community,” Hughes said. “On the heels of the Mercer County Small Business Grant program, this SMBX initiative will allow startups and established businesses alike to grow and expand through the infusion of much-needed capital.”
“Small-business owners nationwide are choosing to raise funds through everyday investors in their communities, giving people a chance to earn money by investing in the businesses they love,” Ben Lozano, co-founder and CEO of SMBX, said. “We’re excited to partner with Mercer County to help businesses raise funds with no fees for owners or investors.”
Small-business qualifications
- Physical business located in Mercer County;
- For-profit business registered with the state of New Jersey, and formed on or before April 10;
- 30 employees or fewer, with part-time equating to one-half a full-time employee;
- Less than $10 million in gross revenue;
- Preference is given to those businesses that have not received specific business grant assistance from the federal, state or local government entity; and,
- National franchises, real estate businesses and independent consultants are ineligible.
Small-business owners can apply to raise funds through the Mercer County Office of Economic Development, SMBX or the African American Chamber of Commerce of New Jersey.
SMBX and the Mercer County Office of Economic Development will work closely with business organizations and chambers of commerce, including the Princeton Mercer Regional Chamber, the AACCNJ, the Capital Region Minority Chamber of Commerce and the Latino Merchants Association, to market the program and provide technical assistance to small businesses to prepare them to raise capital through SMBX.
“We are pleased with the decision of the Hughes administration to support our efforts to expand capital access to the members of the African American Chamber of Commerce and businesses throughout Mercer County,” John Harmon, founder, CEO and president, AACCNJ, said. “It is through the efforts of forward-thinking leaders that we can collectively collaborate to advance best practices that can lead to transformational outcomes; the resulting benefit will be a more competitive Mercer County.”
The Mercer County Small Business Investment Program will run through September 2024.
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