Cuyahoga County has selected Venture Development Organization JumpStart Inc. as its partner to leverage county investments in innovation and entrepreneurship with a $4.5 million loan.
JumpStart responded to a request for proposals in a competitive process aimed at launching county initiatives expected to attract venture capital and accelerate fast-growing businesses in Cuyahoga County. The county will lend up to $4.5 million as part of its new Innovation Match for Pre-Seed Capital ($2.5 million) and Early Stage Loan Fund ($2 million).
Cuyahoga County Executive Armond Budish is behind the new private-public partnership, that he hopes to become one of the largest of its kind nationwide. It’s part of a revamped Cuyahoga County economic development strategy initiative.
“To my knowledge, this is a first in county government – but for us it won’t be the last. It is my greatest hope that this is just the start of the type of ongoing, transformational investments that we will be able to make in the future as our current financial condition strengthens,” Budish said in a written statement.
Cuyahoga County has set up the investment to virtually eliminate any risk to county taxpayers by requiring that Jumpstart secure these loans. The money is expected to be paid off in seven years with a 2 percent interest rate.
While JumpStart has been recognized nationwide for nurturing high-growth companies and attracting funding, most of the organization’s funding comes from grants.
About 50 percent of JumpStart’s funding comes from the state’s Ohio Third Frontier Commission. Other funding comes from local and community foundations and private sources such as individuals and corporations.
Read the full story at Cleveland.com.