[fedelwet]

Will they buy me a new computer and an upgraded phone plan? No. Grants are only for small business that will demonstrably provide significant new jobs. I hadn't heard about the "match venture capital" thing, so can't comment on that aspect. But there is language about "public/private partnership" and perhaps that's what it means.

But the new act (along with last April's ARRA) will make it easier to get SBA-backed loans.

At least, that's my (very limited) understanding.

[ENGINESSQ]

It lowers the tipping point for a positive response from VCs, which presumably means more projects get greenlighted overall.

[Guloqkcm]

Do you really think so? It simply means that VCs don't have to invest as much, or do you think it will increase that chance of success?

How could it not? Either expected benefit increases or expected cost decreases when an investment triggers additional funding or access to capital. Either way, the balance shifts in favor of making the investment. This may not be necessary, but as a precaution, a simplified example:

I have some money I'm considering investing in a small startup, which needs $1,000 to get going. The SBA will match my investment with a grant to the startup. If I go ahead and invest the full $1,000 and the startup takes the matching loan, it has twice the capital it would have had otherwise, and thus a higher chance of success. The expected benefit has gone up. If, on the other hand, I invest $500 and the SBA matches with a $500 grant, the startup still has its $1,000 of needed capital, but getting in has only cost me half as much. The expected cost has gone down. Either way, I'm more likely to invest than if my $1,000 investment is the only capital the startup receives.