CincyTech Receives $3 Million Third Frontier Award
State money will match $3M locally to create Fund III LLC
CINCINNATI – Cincinnati-based seed-stage investor CincyTech on Thursday received a $3 million grant from Ohio Third Frontier to help it create CincyTech Fund III LLC, which will enable CincyTech to continue its work of investing in technology-based startup companies in Southwest Ohio.
CincyTech has raised $3 million in local matching money – a requirement of the Third Frontier grant — from Southwest Ohio institutions, foundations and individuals, bringing the total of CincyTech Fund III LLC to $6 million. CincyTech receives half of its operating money and half of its investment funds from Third Frontier, and the rest from local sources.
Organizations that have committed to invest in Fund III include the Greater Cincinnati Foundation and the Health Foundation of Greater Cincinnati, as well as about two dozen private investors.
Like CincyTech’s first two funds, Fund III will make equity investments in companies focused on information technology, bioscience and advanced manufacturing that are based in or willing to move to Southwest Ohio. The new fund has the capacity for up to 18 new investments.
CincyTech’s Fund I and Fund II are now fully committed or reserved. To date, 43 companies have received nearly $15 million in CincyTech funds and $170 million in private investment – a better than 10:1 ratio of CincyTech dollars to private dollars.
“The amount of private money these startup companies are drawing is a strong validation of the quality of companies we are creating,” CincyTech President Bob Coy said.
A report released in October by the Center for Entrepreneurship at the Ohio State University Fisher College of Business, which conducts an annual analysis of startup activity in the state, found that CincyTech investments account for 80 percent of the startup investment activity in the region.
CincyTech is a Cincinnati-based seed-stage investor focused on startup businesses in high-tech industries in Southwest Ohio. With substantial support from Ohio Third Frontier and corporations, foundations, civic organizations and individuals here, it is stimulating the growth of venture-worthy companies in information technology, bioscience and advanced manufacturing.
About Ohio Third Frontier
Ohio Third Frontier is an economic development and jobs program that Ohio voters have twice overwhelmingly endorsed through passage of bond issues, most recently in May 2010 for $700 million. Through this program, Ohio’s investment in technology, innovation and entrepreneurs has resulted in the formation of more than 500 new companies, the expansion of existing companies, and more than 48,000 new jobs for Ohioans.