After years of talk about the need for more technology-based industry in the region, several Toledo area companies have provided $5.9 million in matching funds to help turn words into reality.
The funds helped secure an $11.8 million grant from the Ohio Department of Development through the state's Third Frontier Entrepreneurial Signature Program.
One entity - the Ohio/Michigan Chapter of the National Electrical Contractors Association - committed $3 million.
Collectively, the money will create a $17.7 million technology venture fund called "Rocket Ventures" to be used to support entrepreneurs and small technology-based companies in northwest Ohio.
Rocket Ventures will be set up as a nonprofit managing a for-profit venture fund, said Steven Weathers, president and chief executive officer of the Regional Growth Partnership, which is leading the collaborative of investors.
"This is not incentive money; this is an economic tool," Mr. Weathers said. " We really want to see what we can do to create long-term, sustainable economic development in our community."
The state's Third Frontier program awarded a total of $56.8 million to help "commercialize new products and create jobs in Ohio." Northwest Ohio received the second-largest share of that money among six grants made statewide. The northeast Ohio region, which includes Cleveland, received $12.4 million.
In 2002, the Regional Technology Alliance, which was a tech-oriented offshoot of the growth partnership, launched an initiative to create a $20 million venture capital fund known as In4 to help foster tech businesses.
But the fund never got off the ground. It received $540,000 in state and local grants but failed to raise any private investment. In 2003, the growth partnership decided to re-absorb the technology alliance, ending its three-year existence.
Rocket Ventures fills the role that In4 was to play.
Besides the electrical contractors, other area entities committing money were Bostleman Corp., Brooks Insurance Agency Inc., Carson Associates Inc., Center for Innovative Food Technology, Fifth Third Bank, Hylant Group Inc., KeyBank, Lucas County Improvement Corp., National City Bank, National Electrical Contractors Association, the Regional Growth Partnership, Sky Bank, the University of Toledo, and White Family Investment Co.
Shawn Ferguson, chief executive officer of the Lucas County Improvement Corp., the county's economic development arm, said his agency's financial commitment is undetermined.
Although details are still being worked out, the Regional Growth Partnership will form committees to review funding requests and hopes to invest in 32 to 38 companies over three years.
Like other investors, the electrical contractors chapter expects the venture fund to make a profit and provide a return to the investors.
"We always wanted to invest back in our community, except that it's been difficult. There have been limited opportunities," said Tim Michaelsen, chapter manager.
Dennis Johnson, president of Brooks Insurance, which has had operations in downtown Toledo since its inception in 1922, said the state's award proves that northwest Ohio can compete with "the big boys." Brooks committed $100,000 to the fund.
"We have a tendency to focus on the negatives," he said, "but this says to the community and the rest of the state, 'Hey we're a player.'•"
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