By : Tom Still
Source : http://www.jsonline.com
Category : Small Business Grant
In the Samuel Beckett play "Waiting for Godot," two characters named Vladimir and Estragon wait in vain on a roadside for someone named Godot to arrive. They pass the time by eating, sleeping, talking, arguing, singing and more to "to hold the terrible silence at bay."
A similar plot line seems to be playing out in Wisconsin when it comes to growth capital creation.
While the Wisconsin Legislature slowly immerses itself - again - in the paralyzing Godot of recall politics, other states aren't content to sit and wait. Almost daily, it seems, one state or another is announcing a program or fund aimed at fostering economic growth.
Meanwhile, the idea of creating a state-leveraged venture capital fund in Wisconsin continues to wait on the side of the road. A bill with the conceptual support of Gov. Scott Walker and many legislators seems trapped in the "terrible silence" of election recall uncertainties that seemingly have no end.
On any given day, the press covering America's innovation economy carries news from states such as Iowa, Michigan, Colorado, Utah, North Dakota, Texas and Minnesota about public-private initiatives designed to increase investment in the high-growth economy.
Even the stalemated U.S. Congress last week reauthorized the 29-year-old Small Business Innovation Research grant program, proving that both Republicans and Democrats in Washington see the value of investing in the start-up economy.
Legislation being discussed in Wisconsin would authorize about $100 million in state support, to be repaid over time, for a fund that would invest broadly in other Wisconsin funds. This "fund-of-funds" approach would require significant private matching dollars and enable homegrown angel and venture funds to invest in Wisconsin companies, many of which are poised to grow quickly. The state would be a "limited partner" and get repaid just like other investors - with the added benefit of tax revenue from new companies and jobs.
It's an approach akin to what has worked in many other states. As Wisconsin Economic Development Corp. CEO/Secretary Paul Jadin noted in a recent guest column for the Journal Sentinel: "Thirty states already have capital investment programs because they realize that new businesses are the foundation for new jobs."
The bill is unlikely to surface until January, at the earliest, in part because of recall politics but also because of the curious grip of CAPCOs on the Capitol debate. Certified capital companies, or CAPCOs, are often billed as an alternative to the "fund-of-funds" approach, but the experience in Wisconsin and elsewhere suggests it's a less efficient, more costly option that more traditional venture and angel capital.
Even in Wisconsin, however, there are signs that others aren't merely waiting for the Legislature to act.
In a move that signals its continued interest in emerging markets in the Upper Midwest, the State of Wisconsin Investment Board announced last week it will commit up to $80 million to Northgate Capital through SWIB's Venture Capital Catalyst Portfolio. Northgate Capital is a California private equity firm with more than a decade of top-tier investment and fund partnerships. The commitment allows SWIB to access and invest in Northgate's worldwide network. It also allows SWIB to pursue a Midwest and Wisconsin development strategy, as identified in past SWIB reports and other independent studies on the region's largely untapped venture capital investment opportunities.
The Wisconsin Housing and Economic Development Authority is marching ahead with plans to create a Wisconsin Equity Investment Fund with $7 million of federal funding. The fund is being established to increase capital available to venture capital and private equity firms in Wisconsin, with an emphasis on job creation and investment in low-income communities. The fund is expected to generate $70 million in capital investments for Wisconsin small businesses. WHEDA recently collected proposals from experienced investment managers and will announce a rollout in 2012.
At WEDC, the successor agency to the former state Department of Commerce, Jadin is examining other options for investing in industries and sectors beyond the traditional venture and angel capital mold.
With those developments in play, the growth capital bill pending in the Legislature is all the more vital because it would signal to the nation's capital markets that Wisconsin is truly serious about expanding its economy. In fact, legislative inaction at this point would likely be taken as a sign that Wisconsin isn't as "open for business" as it claims.
In "Waiting for Godot," the play ends with Vladimir asking, "Well? Shall we go?" Estragon responds: "Yes, let's go." And neither man moves. Let's hope the curtain doesn't fall the same way on Wisconsin's venture capital drama.
Source : http://www.jsonline.com/business/states-growth-capital-plan-still-in-rehearsal-rd3fkqq-135763298.html
Source : http://www.jsonline.com
Category : Small Business Grant
In the Samuel Beckett play "Waiting for Godot," two characters named Vladimir and Estragon wait in vain on a roadside for someone named Godot to arrive. They pass the time by eating, sleeping, talking, arguing, singing and more to "to hold the terrible silence at bay."
A similar plot line seems to be playing out in Wisconsin when it comes to growth capital creation.
While the Wisconsin Legislature slowly immerses itself - again - in the paralyzing Godot of recall politics, other states aren't content to sit and wait. Almost daily, it seems, one state or another is announcing a program or fund aimed at fostering economic growth.
Meanwhile, the idea of creating a state-leveraged venture capital fund in Wisconsin continues to wait on the side of the road. A bill with the conceptual support of Gov. Scott Walker and many legislators seems trapped in the "terrible silence" of election recall uncertainties that seemingly have no end.
On any given day, the press covering America's innovation economy carries news from states such as Iowa, Michigan, Colorado, Utah, North Dakota, Texas and Minnesota about public-private initiatives designed to increase investment in the high-growth economy.
Even the stalemated U.S. Congress last week reauthorized the 29-year-old Small Business Innovation Research grant program, proving that both Republicans and Democrats in Washington see the value of investing in the start-up economy.
Legislation being discussed in Wisconsin would authorize about $100 million in state support, to be repaid over time, for a fund that would invest broadly in other Wisconsin funds. This "fund-of-funds" approach would require significant private matching dollars and enable homegrown angel and venture funds to invest in Wisconsin companies, many of which are poised to grow quickly. The state would be a "limited partner" and get repaid just like other investors - with the added benefit of tax revenue from new companies and jobs.
It's an approach akin to what has worked in many other states. As Wisconsin Economic Development Corp. CEO/Secretary Paul Jadin noted in a recent guest column for the Journal Sentinel: "Thirty states already have capital investment programs because they realize that new businesses are the foundation for new jobs."
The bill is unlikely to surface until January, at the earliest, in part because of recall politics but also because of the curious grip of CAPCOs on the Capitol debate. Certified capital companies, or CAPCOs, are often billed as an alternative to the "fund-of-funds" approach, but the experience in Wisconsin and elsewhere suggests it's a less efficient, more costly option that more traditional venture and angel capital.
Even in Wisconsin, however, there are signs that others aren't merely waiting for the Legislature to act.
In a move that signals its continued interest in emerging markets in the Upper Midwest, the State of Wisconsin Investment Board announced last week it will commit up to $80 million to Northgate Capital through SWIB's Venture Capital Catalyst Portfolio. Northgate Capital is a California private equity firm with more than a decade of top-tier investment and fund partnerships. The commitment allows SWIB to access and invest in Northgate's worldwide network. It also allows SWIB to pursue a Midwest and Wisconsin development strategy, as identified in past SWIB reports and other independent studies on the region's largely untapped venture capital investment opportunities.
The Wisconsin Housing and Economic Development Authority is marching ahead with plans to create a Wisconsin Equity Investment Fund with $7 million of federal funding. The fund is being established to increase capital available to venture capital and private equity firms in Wisconsin, with an emphasis on job creation and investment in low-income communities. The fund is expected to generate $70 million in capital investments for Wisconsin small businesses. WHEDA recently collected proposals from experienced investment managers and will announce a rollout in 2012.
At WEDC, the successor agency to the former state Department of Commerce, Jadin is examining other options for investing in industries and sectors beyond the traditional venture and angel capital mold.
With those developments in play, the growth capital bill pending in the Legislature is all the more vital because it would signal to the nation's capital markets that Wisconsin is truly serious about expanding its economy. In fact, legislative inaction at this point would likely be taken as a sign that Wisconsin isn't as "open for business" as it claims.
In "Waiting for Godot," the play ends with Vladimir asking, "Well? Shall we go?" Estragon responds: "Yes, let's go." And neither man moves. Let's hope the curtain doesn't fall the same way on Wisconsin's venture capital drama.
Source : http://www.jsonline.com/business/states-growth-capital-plan-still-in-rehearsal-rd3fkqq-135763298.html
