Startups need cash. State and local governments need start-ups and the employment development they offer. It needs to be apparent that the 2 groups can work together and make each other delighted. Absolutely nothing might be even more from the fact.
Each year, federal governments spend 10s of billions of dollars on economic advancement rewards designed to bring in companies and tasks to their communities. There are a substantial number of difficulties, nevertheless, for start-ups and individual factors attempting to obtain these programs.
Economic development leaders usually focus on enormous, flagship tasks that are splashy and will drive the news cycle and bring good media attention to their elected official bosses. For example, you get a massive, $10 billion Foxconn plant in Wisconsin tied to hundreds of millions of rewards, just to see the job sputter into the ground.
There is the paperwork. As you ‘d expect with any government application process, it can be difficult to find the right incentive programs, apply for credits at the correct time, and max out the opportunities available.
That’s where MainStreet comes in.
It’s CEO and creator Doug Ludlow’s third company. He previously founded Hipster, which offered to AOL, and The Pleased House Business, which sold to Google. After that deal, Ludlow went on to become chief of staff for SMB ads at the tech giant, where he saw firsthand the difficulties that startups and all small business face in growing beyond significant urban hubs like San Francisco.
When he and his co-founders Dan Lindquist and Daniel Griffin first began, they were focused on what Ludlow referred to as “a network of remote work centers.” As they were experimenting, last November they tried paying people to leave the Bay Location, offering them $10,000 if they moved to other cities. The deal caused a feeling, with outlets like CNN covering the news.
While the interest from clients was excellent, what fired up Ludlow and his co-founders’ passions was that “literally lots of cities, counties and states connected, letting us know that they had a reward program.” As the team checked out further, they realized there was a big untapped chance to link startups to these pre-existing programs.
MainStreet was born, and it’s an idea that has also drawn in the attention of investors. The company revealed today that it raised a $2.3 million round from Gradient Ventures, Weekend Fund, and others. Start-ups make an application for economic rewards through MainStreet’s platform, and after that MainStreet takes a 20 % cut of any effective application. Especially, that cut is only taken when the incentive is really paid out (there’s no upfront cost), and there is also no on-going membership charge to use the platform. “If you identify the credit that you have the ability to use six months from now, we will charge you six months from now, when you’re in fact getting that credit. It appears to be an organisation model that is aligned well with founders,” Ludlow said.
Now, he says that the typical MainStreet customer saves $51,000, and that MainStreet has crossed the $1 million ARR run rate limit.
Today, the company’s core customers are start-ups requesting payroll credits and research study and development credits, but Ludlow says that MainStreet is working to expand beyond its tech roots to all small businesses such as dining establishments. The business also wishes to broaden the number of financial development programs that startups can obtain. Given the myriad of governments and programs, there are hundreds if not countless more programs to onboard onto the platform.