Today Dimension Mill, Bloomington’s nonprofit center for entrepreneurship and coworking, announced that it was awarded a $399,650 Build to Scale grant from the US Economic Development Administration (EDA). The grant will allow The Mill to grow its existing investment fund for early stage startups, Flywheel Fund, and create a second fund called Turbine.
“It’s no secret that wages in our community lag the national and state averages,” said Executive Director Pat East. “In part, that’s because Indiana ranks 41st in employment in high-paying tech sector jobs. To get those jobs, we need more tech companies, and tech startups need risk capital to grow quickly. We’ve made great progress in the last few years in building our startup ecosystem.”
“This grant from the EDA will allow The Mill to accelerate our successful work to cultivate the next generation of angel investors, fuel innovative new companies, and grow our regional economy.”
The Build to Scale program aims to accelerate technology entrepreneurship by increasing inclusive access to business support and startup capital. Fifty organizations across 26 states received grants totaling $36.5 million. The Mill is one of two Indiana organizations to receive funds under the program’s Capital Challenge grant, which provides operational support for early-stage investment funds.
The Mill launched Flywheel Fund in the summer of 2020 to invest in early stage startups. Flywheel is a private annual fund composed of members who each contribute at least $10,000. Members meet regularly for presentations by startups, then make a group vote on whether to invest.
Flywheel’s first round of 11 members invested $120,000 across five companies in less than six months, investing more money, faster, in more companies, than planned. For its second round, Flywheel quadrupled membership to 50 investors and grew its investment pool to $640,000. The current round of Flywheel Fund will finish dispersing its funds in early 2022.
“Our deal flow is strong,” said Brian Hatton, Venture Partner for Flywheel Fund. “Indiana is producing great tech startups that are ripe with opportunity for investors, for our workforce, and for our economy.”
Flywheel is designed to educate new investors and lower the financial bar for entry into the investment community, according to East. The grant will allow The Mill to grow Flywheel Fund to the private fund legal limit of 99 members and to establish Turbine Fund for seasoned investors to make bigger investments.
Both funds will invest in Indiana-based startups, with special attention to creating equitable access to capital for women and diverse founders. The Mill partners with IU Ventures, Elevate Ventures, and other organizations across the state to locate and vet companies for investment.