Valley Venture Capital Fund Gets $250,000 Grant
YOUNGSTOWN, Ohio – A $250,000 federal grant announced Monday will provide “essential financial support” for a new venture capital fund.
The Seed Fund Support grant for Valley Growth Ventures LLC is part of the $10 million awarded by the U.S. Department of Commerce’s Economic Development Administration under its 2015 Regional Innovation Strategies program.
Valley Growth Ventures is a collaboration of the Mahoning Valley Economic Development Corp., Youngstown Business Incubator and Tech Belt Energy Innovation Center.
“It’s really exciting. This fund can make a significant difference in rebuilding our local economy on a 21st century platform,” said Michael Conway, MVEDC’s executive director.
Jay Williams, U.S. Assistant Secretary of Commerce for Economic Development and a former mayor of Youngstown, announced the awards Monday in Portland, Maine.
“This 2015 Regional Innovation Strategy cohort of grantees is truly an exciting group – the diversity in programs and regional representation proves that innovation and entrepreneurship are igniting all corners of the country,” Williams said in a statement. “From Puerto Rico to Pittsburgh, and Seattle to Blacksburg, these programs will reach all kinds of communities and help entrepreneurs gain the edge they need to succeed.”
The Seed Fund Support grants provide funds for technical assistance to support feasibility, planning, formation or launch of cluster-based capital funds that provide equity-based investments in early-stage, innovation-based startups.
“This provides essential financial support for the administrative component of the fund, as an example, for our marketing and outreach to potential investors,” Conway said. The federal funds will provide administrative support for two years.
Valley Growth Ventures has applied for $3 million in investment capital from the Ohio Third Frontier program. About that much is pledged in matching funds by donors and discussions continue with the state regarding the Third Frontier funding, Conway reported.
“Truly this is new for us,” he remarked. Traditionally, businesses would come to MVEDC with a project that the agency would, in partnership with banks, assist with loans and collateralize the building or piece of equipment purchased.
The target market for this fund is primarily businesses housed in the two incubators whose assets are intellectual property that can’t be collateralized. “So we have to come up with other tools to provide them capital, hence an equity fund,” he said.
Conway expressed his gratitude to the U.S. Economic Development Administration and Williams, U.S. Sens. Sherrod Brown and Rob Portman, and U.S. Reps. Tim Ryan and Bill Johnson.
“When start-ups are looking to get their businesses off the ground, local investment and capital are key to their growth and success,” Brown, D-Ohio, said in a statement from his office. “This funding will boost Valley Growth Ventures and its partners as they work to drive economic growth in the Mahoning Valley region and give life to new local businesses.”
“I am proud to have helped support this important funding that will go to future collaboration between the engines of economic growth in the Valley,” Ryan, D-13 Ohio, added in his prepared statement.
“I will continue to work with these institutions and do everything in my power to ensure they have the resources they need moving forward.”
Copyright 2024 The Business Journal, Youngstown, Ohio.
