Read about it here.
Gov. Purdue annouced this Tuesday, January 15 at the annual Georgia Chamber of Commerce’s “Eggs and Issue” breakfast.
I’ve known about this for a while and it was just a matter of when it might happen. It looks as if Gov. Purdue is going to introduce it to the Legislature this session. If, and when, approved, it’ll be interesting to see how fast the funds flow.
I hear on the street that it is going to be under the ATDC umbrella. If so, Tony and Stephen are going to be popular fellows. However, the fund looks to be headed up by the GRA. So, Mike Cassidy might become a highly sought after individual! Details will be forthcoming, I am sure.
There is precedent for this type of fund in Georgia. ATV was funded in 1994 by a consortium of Georgia companies to fund early stage Georgia based opportunities. Long story short, the fund was eventually managed by an outside partner who managed the fund for superior return for the LP’s (which is proper unless you want to commit career suicide). That meant investing in companies outside of Georgia–which didn’t make the Georgia based LP’s always happy. There is a silver lining in every cloud, tho–ATV spawned Jeff Leavitt and Mike Slawson. Both Mike and Jeff are Kauffman Fellows and continue to operate in Atlanta at other ventures.
There is also the ATDC Seed fund–formerly known as Yamacraw Seed Fund. This was a small fund ($5M) that invested in early stage (Georgia based) technology (initially telecom, I believe) companies primarily out of Venturelab and ATDC. The Atlanta Technology Angels and Imlay Investments co-invested with Yamacraw in a number of deals. Yamacraw was renamed the ATDC Seed Fund and now, I believe, primarily invests in biotech and life science related companies.
So, the $1oM allotted from the state for the GRA fund is nothing new–just a bigger amount. The caveat of the fund may be that there needs to be an additional $30M of private capital raised to match the $10M to be granted by the state. I do not know if that $30M has been identified.
The Legislative session has just started, so it will be interesting to see what happens in the next few weeks. It’ll also be interesting to see what happens to Senate Bill 80!
5 responses so far ↓
Lance Weatherby // January 16, 2008 at 7:50 pm |
The ATDC Seed Fund is still around. Since the initial $5 million dollar fund was established Georgia has allocated an additional $13 million for the ATDC Seed Fund.
The Fund invests in Georgia-based entrepreneurial businesses pursuing innovation in the areas of bioscience, and advanced technology. The fund seeks companies capable of leveraging private investment capital to realize a compelling value proposition and deliver significant economic development benefits. The Fund partners with both local and national investors, investing one dollar of its own capital for every three dollars of private investment. Typically, the Fund will invest up to $1 million into any one company and its capital is primarily used to finance the seed-capital needs of its portfolio companies.
Knox // January 16, 2008 at 8:25 pm |
Thanks for the update, Lance!
Jeff Haynie // January 18, 2008 at 3:34 am |
This is great news for GA entrepreneurs.
I’m glad to see Gov Purdue continue to have an eye and heart toward startups. We need to continue to build a layered model for startup investing that can compete with out of town money.
There is a lot of out of town money shopping Atlanta companies right now and it’s hard for local funds to compete with these guys.
Knox // January 18, 2008 at 4:54 pm |
Jeff–
Thanks for comment. You are absolutely right about out-of-town VC funds/venture debt funds looking for opportunities in Atlanta. I used to get 1-2 calls a month. I get 2 calls a week now from outside money looking for Atlanta companies.
In town capital needs to fund the local companies FIRST, so that we have a say what happens later! The GRA VC fund goes a good way towards helping with that–as well the ATDC seed fund. We just need more PRIVATE capital active–not just state money.
Georgia House Bill 1196-A wise use of taxpayer money? « Common Stock Not // March 11, 2008 at 4:24 pm |
[...] have previously posted about the 2008 Georgia Research Alliance Seed Fund. If you read the previous post, you’ll understand that I strongly support the new GRA Seed [...]