Young companies these days really have the odds stacked against them, due to the fact that the economy truly has been in terrible shape over the last eight years or so, since the last big economic hit that happened in 2008. Since that time, there has been less spending overall, and young companies have had a much harder time at getting their businesses off the ground. In order to combat this struggle that has become so prevalent in just about every state across the country, various state governments have implemented CAPCO programs, which have the overall goal of helping different businesses get the seed money that they need to get off the ground.
These CAPCO programs are basically tax credit based amounts of money that are handed down to different banks. This means that banks do not have to pay back a certain amount of money at the end of the year through their taxes, and are then instructed to hand this money out to different businesses in the area. The goal behind this is to help young businesses get the spark and seed money that they desperately need to compete in this very tough economy that we find ourselves in today. Any business that has a great idea, a product, or an excellent business plan can apply at the banks that get these tax credits and apply for this type of seed money. The banks have the job of going through the different applications, in the exact same manner that they would assess a business loan.
In the end, it is the banks who get to decide who gets the money, as they give out the funds to those companies that they think have the best chance of being successful. A few things happen in this type of system, with the overall intention being a win-win situation for everyone involved. Instead of spending money on various other things, various state governments through these programs are instead investing in the people in their state, in the economy, and the various businesses that are trying to get started. The businesses that receive the seed money get the funds that they need to get off the ground, which should create a great path for them to start really pulling in some revenue, which in turn, in theory, will come back to the state government through taxed revenue that the businesses make over the years.