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CLEVELAND, Ohio — Jumpstart is creating a division solely focused on venture capital and investing another $70 million into tech startups by 2025, the economic development organization announced Wednesday.
The move will double the amount of money the nonprofit has invested throughout its history.
Jumpstart Ventures, part of the larger umbrella of the economic development nonprofit, will have seven employees that solely focus on managing $140 million across four venture capital funds. The new division comes with a website and new branding that will separate Ventures from the other services Jumpstart provides.
The nonprofit invests in tech startups while also providing grants and other funding to small businesses. Jumpstart also mentors many small businesses and entrepreneurs through its Impact Program.
Since 2005, Jumpstart has invested $70 million into just over 140 Ohio tech startups, 82% of them in Northeast Ohio. Combined, those companies raised another $1.6 billion.
According to Jumpstart, those startups have generated $5.3 billion in revenue, created 2,800 jobs and paid $290 million in state and local taxes.
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Jumpstart Ventures will invest another $70 million and expects to raise more capital. Ventures will handle the investment part of the nonprofit, while the larger umbrella of Jumpstart Inc will still help small businesses, corporate partners and research institutions.
The nonprofit invests in pre-seed, seed and series a funding, all types of money tech companies look for early in the process.
Greater Cleveland has generally been outpaced by peer cities when it comes to venture capital. Investment is leaving the coastal hubs of California, New York and Boston, but Cleveland isn’t seeing the gain other midwestern cities have.
In 2021, a record year for venture capital across the U.S., Greater Cleveland companies brought in $480 million, according to the Venture Monitor report. It’s a good year historically for this area, but far behind Detroit ($7.5 billion), Columbus ($5.4 billion), Pittsburgh ($1 billion) and Cincinnati ($1 billion).
According to Venture Monitor, a report put out by the National Venture Capital Association and data-company Pitchbook, venture capital investment has never been higher.
VC-backed companies in the U.S. raised $329.6 billion in 2021, nearly double the record of $166.6 billion raised in 2020. In Ohio, 181 deals were closed for $2.4 billion.
People can learn more about Jumpstart Ventures at its new website, jumpstart.vc.
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