COLUMBUS, Ohio — Two Ohio representatives today introduced legislation that would give the Ohio Capital Fund at least $100 million more to invest in the state’s growth industries, such as health care.
Rep. Jay Goyal, a Mansfield Democrat, and Rep. Sandra Williams, a Democrat from Cleveland, announced the legislation that would expand the investment capacity of the Ohio Venture Capital Authority, which oversees the Ohio Capital Fund. The fund has committed about $111 million — 74 percent — of the $150 million it started with in 2005, said Keary McCarthy, a spokesman for the Ohio House.
The Ohio Capital Fund commits its money to venture capital firms that have offices in Ohio. Those firms, in turn, are supposed to make seed or early stage investments in mostly Ohio companies to drive entrepreneurial growth, job creation and economic prosperity.
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“We cannot move Ohio forward without a keen focus on making sure our economy is growing,” Williams said in a written statement. “An important component of that growth is the expansion of the Ohio Capital Fund, which provides private investment capital for innovative Ohio companies in the seed or early stages of their business development.”
So far, the venture capital firms have invested in 35 Ohio companies that have have annual payroll of more than $90 million, according to the statement.
“The challenges of these economic times require strategic investment in our economy and our future, Goyal said in the statement. “Investing in Ohio’s entrepreneurs and supporting emerging businesses through the Ohio Venture Capital Fund will help create good-paying jobs and position Ohio’s economy for success as the national recession lifts.”
The Ohio Capital Fund does not use state tax dollars or General Revenue Funds. Rather, the venture capital authority raises money for the fund by selling bonds that do not count towards the state’s debt ceiling, the statement said.
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The fund has helped venture capital funds in Ohio grow and has drawn new firms to open offices here, said Baiju Shah, president and chief executive of BioEnterprise, the Northeast Ohio developer of health care companies. “The program has been incredibly helpful to foster enterprise,” Shah said. “Within the region of Cleveland alone, we’ve seen growth of a number of new venture funds — Chrysalis and RiverVest and Radius — all have opened offices in the region.”
The Ohio Capital Fund is managed by Buckeye Venture Partners, which is wholly owned Cincinnati investment manager Fort Washington Investment Advisors Inc.
“I’d like to compliment the House democratic leadership for advancing this proposal,” Shah said. “It’s great to see that in these tough times, they are able to embrace programs that work, and find ways to support them.”
