New Fund Spurs Young Entrepreneurs

Cash-strapped young entrepreneurs can soon benefit from a new, targeted venture fund that will not only provide start-up capital but also help with student-loan debt and living expenses.

Gen Y Capital Partners, created in partnership with the Young Entrepreneur Council (YEC), is the "world's first early stage venture accelerator for Generation Y," or adults born between the mid-80s and mid-90s. The $10 million fund will invest between $15,000 and $50,000 into early-stage ventures in many business categories.

The fund is also the first to utilize the principle of income-based repayment (IBR) to help young entrepreneurs with their student loans. Grant recipients will be eligible to have their student loan payments covered for up to three years as they focus on their start-up activities.

In addition, Gen Y Capital Partners will offer select grant recipients the chance to live on participating college campuses for up to two years as a way to save on living expenses. The young adults will also have access to entrepreneurship education, faculty, and interns. Participating institutions include Cogswell College, Georgetown, and Princeton, according the the YEC fact sheet.

"Right now young people have major hurdles in front them that stop them from joining the entrepreneurial ranks," said Scott Gerber, cofounder of Gen Y Capital Partners. "And what we're doing, utilizing IBR and Gen Y Capital Partners, is eliminating those barriers to entry, including student loan debt, so that we can activate the next generation of young American entrepreneurs."

Part of a larger public-private initiative to spur young entrepreneurs, the Gen Y Capital Partners launch was included in a White House announcement on Tuesday to help future college students manage their education debts. Gerber said the new fund is solely financed through private investors.

“When President Obama launched the Start-up America initiative earlier this year, he called on the private sector to do more than business as usual to promote the next generation of high-growth entrepreneurs," said Tom Kalil, deputy policy director at the White House Office of Science and Technology Policy. "Gen Y Capital Partners answers this call to action, drawing more young entrepreneurs ‘off the bench’ to start innovative companies that boost job growth, and complementing the Administration’s ongoing efforts to help borrowers manage student loan debt.”

Gen Y Capital Partners will open for applications on November 1, and interested applicants can get more information at genycap.com.

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