Technology startups get development money for settling in Indiana

Entrepreneurs looking to finance a technology startup may want to consider shifting their focus away from Silicon Valley and onto Indiana, home to the 21st Century Research and Technology Fund.

The fund provides select technology startups in the state with up to $5 million in business financing for a period of two years or less, aimed to help the companies out of general research and development and into product development.

Founded in 1999, the fund was created to counteract expected losses in the state's manufacturing activity, one that has been hit heavily by the declines in the automotive industry, according to Forbes.

The news provider reports that the awards are not loans, as Indiana only makes money if the funded startups are merged or acquired, float IPOs, or leave the state.

Indiana's program is uniquely attractive to entrepreneurs and small startup businesses because, unlike many other states' programs, it is not tax-incentive based. Tax incentives matter little to startup ventures that haven't yet gotten off the ground - the money is more helpful in the early stages of development, Forbes reported.

In the last two years, the 21 fund has awarded 38 Indiana startups with grants totaling $42,754,599.