I'd never heard of Marc Canter until yesterday, when I read that he's moving to Northeast Ohio to help us become a hub for multi-media companies. According to his blog, he's already connected to a bunch of influential Northeast Ohioans, including some of my colleagues here at JumpStart. His idea is big, bold and audacious -- just what we need more of here in NEO - but will not be accomplished overnight nor by just wishing it so. It will take a city of people with the same vision and motivation all pulling in the same direction, so I hope he has the stick-to-itiveness to deal with the day-to-day blocking and tackling that it takes to change a culture.
While only a small part of the change trying to happen in NEO, JumpStart, since its founding in 2004, has been about trying to change a culture, primarily as it relates to the merits of a high growth business model funded by venture capital. Northeast Ohio has not generally been viewed by venture capitalists as a place to find high growth companies. Solid, slower growth manufacturing companies, yes, but high growth, high tech, get-in-early-and-sell-in-five-years companies, no. And, for most of the companies that are created here, the entrepreneurs who run them seem to be averse to venture investors who are viewed more as "vultures" rather than helpers.
Part of what JumpStart has been attempting to do over the past five years is help our clients understand that while very good things come from building a high growth company (personal wealth creation, jobs) these type of businesses can rarely get where they need to be, as fast as they need to be, without an infusion of capital from someone else. And, typically, this type of risk capital is only available from venture investors. So, while we're often accused of "pushing" our companies toward raising venture capital, we're really just focused on encouraging our entrepreneurs to pursue high growth business models that lead them to a logical exit (sale of company, IPO or recap). In so doing, we find ourselves trying to change a culture that, historically, has tended to view venture capitalists as the bad guys. The bottom line for us is this: if growth can occur without the use of someone else's money, that's great...it's just that it's more the exception than the rule.
But, don't just take it from me. There are others out there reciting the same sonnet. There are a number of good articles out there on when to take VC money including: 5 Milestones to Reach Before Raising Venture Capital, and Should I Take Venture Capital Money?
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).