Committee approves $1 million FY2026 growth-stage grant program to support San Antonio startups

The Economic and Workforce Development Committee of the City of San Antonio voted Jan. 27 to approve staff’s recommendation to fund a $1,000,000 fiscal-year 2026 Growth Stage Grant Program aimed at helping local startups and scaling companies.

Sarah Wappell, business advancement coordinator in the city’s Economic Development Department, told the committee the proposed program would be split evenly between an SBIR/STTR matching grant program and a second-stage company grant program and that staff recommend several guideline changes to increase program impact. "The department's recommendation today is to approve the growth stage grant program for a total program budget of $1,000,000," Wappell said.

Why it matters: staff said the programs are designed to retain and grow headquarters and innovation activity in San Antonio by giving high-growth companies access to non-dilutive capital and technical supports. Staff reported that the second-stage pilot awarded $450,000 to nine grantees; a six-month survey showed four of nine reported revenue growth and the grantees reported a combined $7,060,000 in cumulative revenue growth. The SBIR/STTR matching program awarded 11 matching grants in 2024 totaling $581,000; staff reported $3,360,000 in reported revenue growth from those grantees and said eight of 11 reported revenue growth.

Key policy changes approved or recommended by staff include: lowering the eligibility threshold to firms with 100 employees or fewer (counting part- and full-time staff), raising the wage requirement for newly hired employees funded under the program from $17.15 to $20 per hour to align with the Ready to Work on-the-job training program, and setting a maximum award of $100,000 per grantee for the second-stage program. Staff also proposed requiring a federal SBIR/STTR award within the preceding two years for SBIR/STTR matching applicants and limiting the city match to $100,000 for a phase 2–level request, with staff noting federal phase 1 awards are typically around $250,000 and that federal phase 2 awards are substantially larger.

Budget and timeline: staff recommended splitting the $1,000,000 between the two programs ($500,000 each). The department plans to launch marketing in February, open applications in early March, complete staff review in May, return recommended applicants to the committee in May or June, refer approvals to city council in August and aim for fully executed agreements in September 2026.

Questions and follow-up: Chair Villagran asked staff for a memo explaining why only four of nine second-stage grantees reported revenue growth in the six-month survey and whether timing (new hires, benefits, or market cycles) might explain the results. Staff said documentation of employee counts will be required during application review and that grantees will be monitored at 6-, 18- and 36-month intervals. Council members requested breakdowns by industry cluster and raw outcome data on placements and hires to better assess program effects on local employment.

The vote: after discussion a motion and second were recorded and the committee approved the recommendation by voice vote. Staff will return to the committee with application recommendations in early summer (May/June) and then to city council for final approval.