A couple weeks ago, there was a boot camp session for MassChallenge’s annual startup competition. The competition tries to get new, high growth business in any industry off the ground with training, feedback, PR and networking support. The highest-potential startups receive three months of intensive mentorship, free services in an office space in Boston’s Innovation District, and cash prizes totaling $1 million.
The competition got me thinking about how so many innovative new programs keep emerging and spreading across the nation to kick start entrepreneurship and fund new companies. And, while Northeast Ohio might not be home to a Y-Combinator, TechStars or AlphaLab, we have a lot of diverse funding (and mentoring) sources right here.
At JumpStart, we’ve been providing a minimum investment of $250K since 2004. It’s an amount small enough whereby our limited funds could “jumpstart” ten to 12 companies per year, but large enough to enable an entrepreneur with a high growth company to make meaningful progress. Back in the early 2000s, JumpStart was the earliest stage investor in Northeast Ohio. But that’s changed. We’ve seen a new crop of pre-seed funding resources take root, including those offering $10K grants and $25K loans, and the list of resources keeps growing.
I recently put pen to paper to see just how much that list has grown. I started with some of the newest sources of small dollar amounts and continued on down the investment continuum. I thought I knew what to expect; an expanded source of local money for Northeast Ohio’s entrepreneurs. But the results still surprised me. In the category of “small” ($2K - $40K loans/grants) I counted at least ten different entities making investments of this size; in the category of “mid-size” ($100K - $500K loans/equity) I counted 14 institutional sources and, at least, 20 high net worth (very) active angels.
Here is the list I came up with in just a couple of minutes:
- Launch House - up to $10K investment
- ONE Fund at Ohio State - $20K grant
- Innovation Fund - $25K grant
- Wooster Opportunities Loan Fund - $25K loan
- TiEQuest Competition - $25K grant
- HATCH - $30K - $50K investment
- Partnership for Innovation (PFI) at CWRU - up to $40K grant
- Bizdom U - $100K loan/investment
- North Coast Opportunities Technology Fund - $100K loan
- Akron Development Corporation – up to $250K investment
- Case Technology Ventures – up to $250K investment
- North Coast Angel Fund - $200K investment
- JumpStart - $250K investment
Then there’s Medical Growth Fund, Glengary Ventures, Kadima Partners, Portal Capital, and Everett Partners, all focused on high growth, all of which generally provide between $50K and $500K per investment. And this isn’t even an exhaustive list.
The point is, entrepreneurs need resources of all different types. At JumpStart we work with entrepreneurs opportunities who are in need of significant investments of assistance and capital, but through our role in Ohio Third Frontier we foster collaboration among a host of different support organizations, provide back office support for partners in the JumpStart Entrepreneurial Network, and advocate for new resources to be added to the ecosystem. One of those new resources is Canton Entrepreneur Launch, a hyper-local fund that was recently formed to provide capital to promising ventures willing to locate and grow in the Canton metro area.
I’m pleased Northeast Ohio is rich with organizations and/or people willing to invest at every level. That’s just what entrepreneurs need.
Lynn-Ann Gries is the Chief Investment Officer of JumpStart Ventures. She previously worked in the investment banking departments at both McDonald Investments and Smith Barney (now part of Citigroup), and in the sales and trading area at Morgan Stanley. She received her MBA from New York University’s Stern School of Business and her BA in Economics from Smith College. She currently serves on the board of the Fund for the Future of Shaker Heights, the Great Lakes Science Center and Summer on the Cuyahoga (SOTC).