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COMPETITIVE FUNDING OPPORTUNITY REQUEST FOR APPLICATIONS

Department of Economic and Community Development Jobs4TN Regional Entrepreneurial Accelerator Program

Issue Date:

08/24/2011

Information Session:

09/01/2011

Letter of Intent Deadline:

09/06/2011 at 5 p.m. Central Time

Application Deadline:

09/30/2011 at 5 p.m. Central Time

EMAIL QUESTIONS: ECD.INNOVATION@TN.GOV


TABLE OF CONTENTS SECTION I: OVERVIEW & PROGRAM OBJECTIVES ..................................................... 3 SECTION II: AWARD INFORMATION................................................................................. 4 A.

Type of Award................................................................................................................... 4

B.

Estimated Funding............................................................................................................ 4

C.

Expected Number of Awards........................................................................................... 4

D.

Period of Performance...................................................................................................... 4

E.

Application Timeline ........................................................................................................ 4

SECTION III: ELIGIBILITY INFORMATION ..................................................................... 5 A.

Lead Applicants ................................................................................................................ 5

B.

Applying for Multiple Regions ........................................................................................ 5

C.

Permitted Activities .......................................................................................................... 5

D.

Private Leverage Requirements ...................................................................................... 5

SECTION IV: APPLICATION AND SUBMISSION INFORMATION ............................... 6 A.

Information on Grant Opportunity ................................................................................ 6

B.

Letter of Intent .................................................................................................................. 6

C.

Deadline for receipt of applications................................................................................. 6

D.

Content and form of application submission ................................................................. 6 (1) Grant Proposal Narrative.............................................................................................. 7 (2) Budget............................................................................................................................ 10 (3) Internal Controls and Audit Process Narrative ......................................................... 10

SECTION V: EVALUATION AND SELECTION PROCESS............................................. 11 A.

Evaluation Criteria ......................................................................................................... 11

B.

Review and Selection Process ........................................................................................ 12

SECTION VI: ADDITIONAL INFORMATION ................................................................... 13 A.

Questions.......................................................................................................................... 13

B.

Transparency................................................................................................................... 13

C.

Reporting, Monitoring and Inspections........................................................................ 13

D.

Timeliness Requirements ............................................................................................... 13

E.

Payment ........................................................................................................................... 13

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SECTION I: OVERVIEW & PROGRAM OBJECTIVES Governor Bill Haslam announced the Jobs4TN plan in April 2011 to accomplish his goal of making Tennessee the No. 1 location in the Southeast for high quality jobs. As the state’s primary economic development agency, the Department of Economic and Community Development (ECD) has been charged by the Governor with overseeing the successful implementation of the plan. Jobs4TN is a comprehensive plan built around four strategies, one of which is investing in innovation. The Department’s primary innovation effort is the INCITE Initiative, which stands for INnovation, Commercialization, Investment, Technology and Entrepreneurship. INCITE’s goal is to elevate Tennessee’s profile in innovation-based economic development and drive economic growth via the creation of knowledge-based jobs. As part of INCITE, the Department will be overseeing a competitive grant process to provide funding to an entrepreneurial business accelerator in each of the state’s nine “Jobs Base Camp” regions, as defined in the Jobs4TN plan. The goal of the business accelerators is to nurture and support entrepreneurs as they develop business plans and launch companies that have the potential to create a large number of highwage jobs. These regional accelerators will support entrepreneurs and startup businesses by providing them education and training, mentoring, strategic and technical support and expanded access to capital.

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SECTION II: AWARD INFORMATION A. Type of Award ECD anticipates awarding grants under this Competitive Funding Opportunity. B. Estimated Funding Approximately $2,250,000 is available for new grant awards in this funding cycle. The maximum award will be $250,000. Successful applicants may have the opportunity to apply for an additional $250,000 of funding in each of two (2) subsequent annual funding cycles, bringing the total funding potentially available for each accelerator to $750,000 over a three year period. C. Expected Number of Awards ECD anticipates awarding nine (9) grants under this competitive opportunity. ECD expects to award one (1) grant in each of the nine Jobs4TN regions. D. Period of Performance ECD expects that successful applicants will fully obligate and expend funding received under this grant award cycle by June 30, 2012. E. Application Timeline Milestones Grant Criteria Released Information Session Letter of Intent Due Date Application Deadline Application Review Period Announcement of Awards

Anticipated Dates August 24, 2011 September 1, 2011 September 6, 2011 September 30, 2011 October 1 - 21, 2011 October 31, 2011

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SECTION III: ELIGIBILITY INFORMATION A. Lead Applicants In order to be eligible under this Competitive Funding Opportunity, the lead applicant must: •

Be a public, private, non-profit, or for-profit entity;

Have clear policies relating to internal controls and annual audits; and

Demonstrate that it has the capacity to provide assistance to entrepreneurs and small business.

If a consortium of organizations is submitting an application, or proposing to create a new regional accelerator, a lead applicant must be identified. The lead applicant must be the fiscal agent for the grant.

B. Applying for Multiple Regions In the event an organization wants to apply as the lead applicant for regional accelerators in multiple Jobs4TN regions, the organization must submit separate applications for each region. C. Permitted Activities Successful applicants must use funding received under this program to support entrepreneurs within their region. Allowable activities may include, but are not limited to, business training, general business counseling, mentoring and networking, technical assistance, feasibility studies, planning activities, and assisting in market development. Funding received under this competitive grant program cannot be used for construction-related expenses. Nor can the funding be used to finance existing debt. D. Private Leverage Requirements Applicants must demonstrate a local matching share (as defined in 13 C.F.R. § 300.3) from non-federal sources that must be available and committed to the project. This match must be at least equal to the estimated value of the grant ($250,000 a year for three years). It is expected that applicants with even higher private leverage ratios will receive higher merit review scores on sub-criteria 2.1 of the Grant Proposal. The private leverage requirement can be met through in-kind contributions including contributions of space, equipment or services. Applicants should provide letters of commitment that demonstrate the local match.

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SECTION IV: APPLICATION AND SUBMISSION INFORMATION A. Information on Grant Opportunity Information on the Jobs4TN Regional Entrepreneurial Accelerator Program can be found at www.tn.gov/ecd. Applications must be submitted electronically to ecd.innovation@tn.gov. ECD will hold an information briefing for perspective applicants on September 1, 2011 in Nashville, Tenn. Please visit ECD’s website for additional information and registration requirements. B. Letter of Intent Applicants are requested to submit the letter of intent by 5 p.m. Central Time on September 6, 2011. ECD strongly suggests interested applicants submit a letter of intent, but failure to submit a letter of intent will not disqualify an applicant that submits a complete application. In the letter of intent, applicants are asked to identify: • The lead applicant • Other organizations that are likely to be partners in the application; and • The Jobs4TN region the accelerator is seeking to serve. Applicants should submit their letter of intent electronically to ecd.innovation@tn.gov. C. Deadline for Receipt of Applications The deadline for receipt of applications is September 30, 2011. Applications must be received by 5 p.m. Central Time. Applications received after the closing date and time will not be considered for funding. Electronic submission to ecd.innovation@tn.gov is required. ECD will not accept any changes, additions, revisions or deletions to applications after the closing date and time has passed. D. Content and Form of Application Submission A complete application submitted in response to this funding opportunity will contain three separate parts: 1. Grant proposal narrative & supplemental information 2. Budget template 3. Internal controls and audit processes narrative Applications that do not address the information required in each part will be considered nonresponsive and will not be considered for funding. The grant proposal may not exceed 15 single-spaced pages.

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Applicants are advised to carefully read the instructions contained in the Competitive Funding Opportunity. It is the sole responsibility of each applicant to ensure that a complete application package is received. (1) Grant Proposal Narrative The grant proposal narrative should demonstrate the applicant’s ability to implement the proposed activities in accordance with the requirements set forth in the Competitive Funding Opportunity. The length of the grant proposal narrative is limited to 15 single-spaced, singled-sided 8.5 x 11 inch pages with 12-point font and 1-inch margins. Supplemental information provided at the end of the grant proposal narrative will not count towards the 15 page limit. Supplemental information may include: letters of support or commitment from strategic partners, a map of the region, organization charts, a table of regional demographic or population information. The grant proposal narrative and any supplemental information should be submitted as a single Adobe PDF file. The grant proposal narrative should be organized in the following four (4) sections and address each criteria item: •

Regional accelerator model o Entrepreneur recruitment and selection o Programming and curriculum o Mentoring o Access to capital o Regional outreach o Outreach to underserved populations Fiscal sustainability o Private leverage o Long-term sustainability Management and governance o Management team o Governance structure Regional impact and expected results o Time to market o Accelerator performance o Entrepreneur/company performance

The requirements of what must be included in each component of the grant proposal narrative are outlined below. Applicants should cite the source of all data presented throughout their application.

1.0 Regional Accelerator Model: How will the accelerator meet the needs of entrepreneurs within the region?

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The applicant should clearly identify the Jobs4TN region that the grant proposal narrative intends to serve. The applicant should describe its business model and how entrepreneurial support services are provided by the business accelerator. How are entrepreneurs selected? How does the accelerator model meet the needs of entrepreneurs within the entire Jobs4TN region? What strategic partnerships have been established? What additional partnership does the applicant plan to establish? The applicant should include answers to the following questions: 1.1 Recruitment and Selection The applicant should describe the processes used to recruit, screen and select entrepreneurs into the accelerator. What guidance, if any, will the applicant provide to entrepreneurs not selected for the accelerator? 1.2 Programming and Curriculum Describe the programs, coaching, curriculum and training provided by the applicant to entrepreneurs selected for the accelerator. How does the proposed accelerator model allow the applicant to respond quickly to changes in the needs of the entrepreneurs within the region? 1.3 Mentoring The applicant should describe its organization’s philosophy on mentoring. How are mentors selected? How are entrepreneurs matched with perspective mentors? 1.4 Access to Capital The applicant should describe in detail the process used to support entrepreneurs efforts to raise capital. How does the applicant plan to provide entrepreneurs the opportunity to interact and engage with investors and other sources of capital? Please document established or planned partnerships. 1.5 Regional Outreach The applicant should describe its capacity to provide service within the entire Jobs4TN region. How will all counties within the region be supported? How does the proposed model meet the specific needs of the Jobs4TN region in which the applicant is applying? 1.6 Underserved Population Outreach How will the accelerator model specifically target services to disadvantaged communities, economically distressed areas and historically underserved populations (minority and women owned businesses)?

2.0 Financial Sustainability: How does the applicant ensure fiscal sustainability of its service delivery model? The applicant should use the budget template to provide a detailed budget for its proposal. Additionally, provide a narrative that describes the applicant’s system of internal controls and audit processes. How will the applicant leverage and attract private capital to become self-sustainable? The applicant should include answers to the following questions:

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2.1 Private Leverage At least a 1:1 private leverage ratio is required. Provide a detailed narrative and calculation that shows the level of non-state funding the applicant will leverage. Provide evidence of private leverage (e.g., letters of commitment from strategic partners or funders, existing accelerator budget) in the supplement to the grant proposal. 2.2 Long-term Sustainability How will the applicant ensure the proposed service delivery model is financially sustainable over the long-term? Describe how the applicant will continue to provide services to entrepreneurs within its region at the end of the grant period.

3.0 Management and Governance: How is the regional entrepreneurial accelerator managed and governed? Describe how the applicant will establish, operate and manage a high performing business accelerator that will support job growth and entrepreneurship within its Jobs4TN region. Who are members of the management team? What is the governance model? The applicant should include answers to the following questions: 3.1 Management Team How is the regional entrepreneurial accelerator managed and operated? Who are the senior leaders? Provide qualification evidence that documents their ability to provide support to entrepreneurs within the region (e.g., bios of the management team). 3.2 Governance Model Describe the governance structure of the accelerator. What is the role of the board of directors or advisory board? How does the management team interact with the board of directors or advisory board? Provide qualification evidence that documents the board’s ability to effectively execute these functions (e.g., bios of board members).

4.0 Regional Impact / Expected Results: What is the impact from the services provided by the applicant’s accelerator model to its region? Summarize key performance metrics and expected results for the regional entrepreneurial accelerator. Include information on service delivery model performance, entrepreneur performance and company performance. Provide data and information to answer the following questions: 4.1 Time to market Provide a timeline that shows when the programming described in section 2.0 will be available to entrepreneurs within the region.

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4.2 Accelerator Performance Provide historical and projected results for key metrics that demonstrate success of the proposed service delivery model and entrepreneurial support processes. For all applicants, please describe how many entrepreneurs the accelerator plans to serve, how many new companies the applicant believes will be formed by these entrepreneurs and any other metrics the applicant plans to use for measuring accelerator performance. For existing accelerators, please provide past performance data on these metrics. For new accelerators, please provide evidence on the past success of the applicant’s management team and/or governing board members on each of these metrics. 4.3 Entrepreneur/Company Performance Provide historical and projected results for key entrepreneur/company outcome metrics. Please describe how the applicant will track the performance of entrepreneurs/companies participating in the accelerator including future company financial performance (e.g., revenues and/or profits), how many jobs are created, the total wages of those jobs, how much initial and follow-on capital is raised and any other metrics the applicant deems important. For existing accelerators, please provide past performance data on these metrics. For new accelerators, please provide evidence on the past success of the applicant’s management team and/or governing board members on each of these metrics. (2) Budget Applicants must provide a detailed budget with their grant proposal. Applicants are requested to use the budget template available on the ECD website. Applicants should clearly document expected expenditures and provide a budget justification narrative that explains how they propose to expend funding. Also provide a narrative that explains planned expenditures during the current program year. ECD will approve all budget proposals prior to contracts being awarded to successful applicants. Applicants should plan to fully expend grant funds during the period of performance while ensuring full transparency and accountability for all expenditures. (3) Internal Controls and Audit Process Narrative Applicants are requested to provide a narrative that describes their internal accounting and administrative controls used to safeguard against waste and misappropriation of funding. Applicants that lack sufficient internal controls and audit processes will not be eligible for funding.

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SECTION V: EVALUATION AND SELECTION PROCESS

A. Evaluation Criteria All applications will be evaluated on a 75 point scale. Evaluations will be based upon the information provided by the applicant within their grant proposal narrative, supplemental information and budget. Additional information not requested under this Competitive Funding Opportunity will not be reviewed or evaluated. Evaluation Criteria

Points

1.0 Regional Accelerator Model 1.1 Recruitment and Selection (5) 1.2 Programming and Curriculum (5) 1.3 Mentoring (5) 1.4 Access to Capital (5) 1.5 Regional Outreach (5) 1.6 Underserved Population (5)

30

2.0 Financial Sustainability 2.1 Private Leverage (5) 2.2 Long-term Sustainability (5)

10

3.0 Management and Governance 3.1 Management Team (5) 3.2 Governance Structure (5)

10

4.0 Regional Impact and Expected Results 25 4.1 Time to Market (5) 4.2 Accelerator Performance (10) 4.3 Entrepreneur/Company Performance (10) Total

75

1.0 Regional Accelerator Model (30 points) Criteria 1.0 will be evaluated based on the extent to which the applicant presents clear and well-defined evidence that their proposed model will effectively meet the needs of entrepreneurs throughout their Jobs4TN region. Each sub-section will be scored on a 0-5 scale using the process described below section V.B. 2.0 Financial Sustainability

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Criteria 2.0 will be evaluated based on the extent to which the applicant presents, and is able to demonstrate, a well-defined strategy to ensure that resources are in place to ensure both the short-term and long-term financial sustainability of the regional entrepreneurial accelerator. Each sub-section will be scored on a 0-5 scale using the process described below section V.B 3.0 Management and Governance (10 points) Criteria 3.0 will be evaluated based on the extent to which the applicant demonstrates a qualified and competent management team and well-defined governance structure. Each sub-section will be scored on a 0-5 scale using the process described below section V.B. 4.0 Regional Impact and Expected Results Criteria 4.0 will be evaluated based on the extent to which the applicant documents and provides clear evidence in their proposal that the proposed activities will lead to quantifiable outcomes. In addition, applications will be evaluated on the extent to which the applicant (or the application team) is able to document and demonstrate an effective historical track record of producing specific quantifiable results. Sub-Criteria 4.2 and 4.3 will be scored on the 0-5 scale, but will receive double weight. B. Review and Selection Process Applications received by ECD before the application deadline will be reviewed and selected through a merit review process. Each Jobs4TN region will be assigned two reviewers. These reviewers will review and score each application for the region. ECD expects that one reviewer will be an ECD staff member and that the other will be an out-of-state stakeholder with experience in innovation and entrepreneurship. Each merit review team member will score the application independently by evaluating the proposal against the criteria and subcriteria described in section IV.D and assigning a total score to each proposal. If the two merit reviewers’ total scores differ by more than seven (7) points, a third reviewer will independently score the application. The final score for the application will be the average of the independent scores of the merit reviewers who scored the application. The highest scoring application in each of the nine Jobs4TN regions will receive a grant. Each criteria item will be evaluated on a 0-5 scale. Score 0 1 2 3 4 5

Description No response provided or response provided by the applicant is not relevant to the criteria item. The response does not address each criteria in a substantive way. The response addresses each criteria in a substantive way. The response addresses each criteria in a substantive way and has a reasonable likelihood of being implemented in the way described. The response is a documentable best practice and has a reasonable likelihood of being implemented in the way described. The response is a documentable best practice and has a high likelihood of being implemented in the way described.

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SECTION VI: ADDITIONAL INFORMATION A. Questions All questions should be submitted via email to ecd.innovation@tn.gov. A list of frequently asked questions will be developed and posted on the ECD website (www.tn.gov/ecd). B. Transparency ECD is committed to conducting this grant award process in an open and transparent manner. Applicants are advised that their respective applications and information related to the review and evaluation may be made publicly available, either fully or partially in accordance with Tennessee’s Public Records Act, except for those limited documents exempted from disclosure. Additionally, applicants are advised that quarterly and annual performance reports will be made publicly available, either fully or partially. C. Reporting, Monitoring and Inspections Applicants must permit ECD and/or any agent of theirs to inspect the physical location of a project at any time during the project period. Inspections will be conducted during regular business hours. All recipients of funding under this program are required to report on their activities. ECD will withhold payment if reports are not completed in a timely manner. Funding recipients must submit quarterly performance reports and annual audited financial reports. These reports are due 30 days after the end of each quarter or calendar year. ECD will provide recipients reporting templates. D. Timeliness Requirements Projects selected for funding through this program must begin implementation within 60 days of receiving an award from ECD. ECD reserves the right to terminate a contract at any time if the recipient fails to adhere to the contract timetable. E. Payment The method of payment will be on a cost reimbursement basis. Grant recipients will submit a reimbursement/drawdown form as necessary, but not to exceed one reimbursement request per month. Reimbursement requests must be accompanied with copies of all appropriate documentation of allowable expenses incurred. All reimbursements will be provided to grant recipients via electronic funds transfer.

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ECD will monitor the project and endorse payments in accordance with observed progress. Payments will be conditional on compliance with grant agreement requirements and applicable project approvals issued by ECD. Project costs incurred by an approved applicant before entering into contract with ECD, including any feasibility studies, financial analysis or other preparation costs are not eligible for reimbursement. F. Information Session ECD will host an information session for prospective applicants in Nashville on September 1, 2011. Please visit the ECD webpage for additional details and registration requirements, www.tn.gov/ecd.

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Regional TN GRANT