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Cuyahoga County Launches Fund to Help New Tech Firms Get Investment

Friday, July 04, 2008

Provided by The Plain Dealer
Written by Tom Breckenridge

Cuyahoga County has launched a modest $750,000 fund to help new technology companies lure more investment.

The county's Department of Development will dole out loans of $25,000 or more to six fledgling companies yearly, in hopes they will grow into substantial employers.

The North Coast Opportunities Technology Fund is geared "to move small, tech-based companies to the point where they attract more financing," said Greg Zucca, development analyst for the county.

Cuyahoga County commissioners recently approved the program. The county will work with TechLift, the entrepreneurial support program operating out of NorTech, the region's technology-development organization.

The fund is designed to fill an investment gap for tech start-ups.

Typically, new businesses launch with investment from friends and family and need another shot of cash to build their business plans and catch the eye of early-stage investors, like JumpStart Inc.

The county's technology fund will offer loans at 5 percent, payable after five years or when the company gains significant investment. Companies must show "slam dunk" projects that serve $1 billion markets, Zucca said.

"The idea is to provide the money when these companies are most in need and pay it back when they are most able," Zucca said.

Zucca and Chris Mather, director of TechLift, described the fund this week at a luncheon of CuyahogaNext, a group of business leaders and economic development professionals who advise the county on economy-building initiatives.

Several in the crowd asked whether the county could do more to keep the companies here once they pay off the loans.

Zucca acknowledged some companies will leave. But the goal is to create a "churn" of entrepreneurial start-ups and build the area's image as an attractive, technology cluster, Zucca said.