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86-page report seeks to help small businesses financially

Efforts to boost venture capital investment in Arkansas were spurred by an inaugural report from the University of Arkansas that highlights initiatives to provide more financing options for small businesses in the ‘State.

The report, called the Arkansas Capital Scan, describes several categories of funding that startups and small businesses typically rely on to support or expand their operations. Entrepreneurship support organizations across the state should benefit from the study, the university said in releasing the 86-page report.

The Capital Scan is modeled on a similar survey conducted annually by the University of Oregon. The Arkansas report, which officials said they plan to publish annually, was developed by teams from the Sam M. Walton College of Business and the Economic Development Division.

Areas examined by the Arkansas team include an overview of angel and venture capital investments, crowdfunding, grants from government and philanthropic agencies, and loans from banks and credit unions.

The report, intended to be an annual publication, aims to help policymakers, investors and other stakeholders identify gaps and opportunities for small businesses.

“We know that 2020 has been an abnormal year for looking at any part of the economy, and that was certainly the case for the flow of resources to Arkansas small businesses and startups,” Sarah Goforth, executive director of the university’s office of entrepreneurship and innovation, said in a press release announcing the project.

The report, she said, examines “how well we are doing in Arkansas in our ability to provide emergency support to small businesses, and how we compare to peer regions in our ability to. capitalize on high growth technology companies? “

Arkansas Capital Scan is organized by investment type, including a review of the regional, industrial, and demographic distribution of funding for the 2020 calendar year. Due to the lack of historical data in Arkansas, the researchers used data from Missouri , Oklahoma and Tennessee to compare capital flows in Arkansas.

“The ultimate goal of this report is to understand capital flows in Arkansas and identify potential areas where the ecosystem can be strengthened and funding gaps where capital flows could increase or be deployed more effectively. “, says the introduction.

The main findings of the report include:

• New commercial applications in Arkansas have grown at an historic rate, even during the ongoing pandemic.

• Patent filings for technology and angel / seed investments are on the rise even though entrepreneurs report difficulties in accessing sufficient seed capital for their businesses.

• Venture capital investment lags significantly for Arkansas companies compared to comparable regions.

• Companies in the life sciences sector received a greater share of angel / seed deals in 2020 as venture capital investments poured into various industries.

• Angel / seed investment was made in a relatively diverse range of founders compared to national averages, but 100% of venture capital invested in Arkansas in 2020 went to companies founded by white men.

• Companies based in Northwest Arkansas and Little Rock received almost all of the state’s equity investment.

• Banks are a major source of commercial lending in Arkansas and devote a greater portion of their portfolios to commercial lending than the national average.

• Credit unions in particular serve as an important liquidity channel for small businesses in Arkansas.

More than 20 college students helped compile the report using documents, interviews, and polls from Pitchbook and the U.S. Securities and Exchange Commission.

The researchers examined how the invested money flowed into startups and supporting organizations, what funds were available, and were asked to identify funding gaps as well.

“Our hope is that by including students in the Arkansas Capital Scan creative process, we empower the next generation of Arkansas financial professionals to understand how to navigate and improve the capital landscape for our founders.” said Cash Acrey, general manager of the business school’s master’s in finance program.

GROWING THE PANACEA

Panacea Financial of Little Rock has recruited six healthcare veterans to expand the company’s commercial banking offerings to physicians across the country.

The company’s practice solutions division provides financial services to help start, grow or expand their medical, dental or veterinary practices. The Panacea team will provide the loan and bank resources necessary to finance the initiatives.

“We now have a highly experienced and seasoned team who we believe will provide the strongest and fastest end-to-end healthcare vertical in the country,” said Tyler Stafford, President and CEO and Co-Founder of Panacea .

Panacea Financial began operations on November 1 on Kavanaugh Boulevard with eight employees and now has 16 employees, including 10 in satellite offices.

The company provides financial products and services – personal loans, refinancing, checking accounts and free savings accounts with no overdraft fees – to physicians across the country.

Panacea operates as a division of Sonabank, a Richmond-area-based community lender that is Virginia’s fifth-largest bank with nearly $ 10 billion in assets.

More information is available at panaceafinancial.com.

ROCK IT! SATURDAY

Rock It! The Little Rock Downtown Library Lab will provide a pop-up store for shoppers looking for holiday gifts and an opportunity to support small businesses just starting out.

The entrepreneurial organization, which targets underserved startups, will open the store Saturday from 10:00 a.m. to 5:00 p.m. on the ground floor of the Cox building at 120 River Market Ave.

More than 20 promising vendors will offer products including non-perishable food, handmade jewelry, original artwork, clothing and housewares.

The Arkansas Central Library parking lot will also serve as a mini food court with refreshments for sale in food trucks, including a coffee cart. The library will also be offering discounts on books at The Galleries & Bookstore at 401 President Clinton Ave.

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