By Adam E. John

The U.S. Small Business Administration (SBA) is moving forward with launching a $1 billion Early Stage Innovation Fund, originally announced as part of Startup America, which will provide matching capital to Small Business Investment Companies (SBICs), targeting early-stage small businesses seeking private institutional capital, according to a statement from the White House.

The White House is also hosting the first board meeting of the Startup America Partnership, where board members will announce commitments from more than 50 private-sector partners to deliver over $1 billion in value – from free software to free consulting and legal services – to 100,000 startups over the next three years.

“Today, we’re announcing $2 billion in public and private resources to help entrepreneurs start and grow their businesses. Now it’s time for Congress to do its part. It was encouraging to see members of both parties in the House come together to pass legislation that will help small businesses get ahead, and I’m calling on the Senate to do the same. But America’s small businesses can’t wait for these important tools to grow and hire faster,” said President Obama.

The Early Stage Innovation Fund will leverage the SBIC program to allow privately managed investment funds to put more capital into the hands of small business startups. SBA is acting on this commitment by proposing a modification of its rules allowing private funds that invest in early stage companies to participate in the SBIC program. The proposed modifications are now up for public display, and the fund will be fully implemented in 2012.

The Startup America Partnership is a nonprofit alliance of entrepreneurs, major corporations, and service providers committing private-sector resources to accelerate the growth of new companies. The Partnership, led by entrepreneurs like Steve Case (AOL) and Reid Hoffman (LinkedIn), was launched earlier this year.