It was 1989 and Jack Wyant was frustrated about a stumbling block he had run into with two startup companies he had run. When he was looking for investors he had to turn to out-of-town sources. Cincinnati didn’t have any venture capital firms.
Wyant wasn’t having any of that. He talked to Don Weston, the head of what was then one of Cincinnati’s largest investment firms, Gradison & Co., to pitch Weston on the idea of backing a new venture capital firm based in the Queen City.
The idea had been broached about five years before that. The Greater Cincinnati Chamber of Commerce had pushed for a local venture capital firm and had some people from a Boston firm lined up to launch an operation here. But they decided they couldn’t raise a local fund, saying Cincinnati wasn’t knowledgeable or supportive enough to make it happen.
So Wyant was startled by Weston’s response.
“He said, ‘That’s a great idea, let’s do it,’” Wyant told me. “I said, ‘Do you want to sleep on it? Do you have a committee to talk with or do you want a memo from me?’ He kept saying, ‘No, let’s do it.’”
Weston was talking to the right guy, because Wyant did it. He lined up numerous investors starting in 1990, raised a $44 million fund within two years and launched Blue Chip Venture Co. It was Cincinnati’s first successful venture capital firm. And it was long overdue. Cincinnati had been the nation’s largest market without a venture capital firm.
Wyant changed all of that, and that’s a big reason why he’s the winner of the Cincinnati chapter for the Association for Corporate Growth’s Lifetime Achievement Award at this year’s Deal Maker Awards on Wednesday.
Building a legacy
“Jack is like the Lewis and Clark of the Cincinnati venture capital industry,” Pete Blackshaw, CEO of Over-the-Rhine-based startup catalyst and investment fund operator Cintrifuse, told me.
Blue Chip grew to become a massive player on the Cincinnati venture capital playing field. Over the years Blue Chip has raised 10 funds and invested $800 million in 208 companies through 600 financing rounds. Wyant has been a director of 50 companies.
The impact on Cincinnati’s venture capital and startup communities has been great.
“A lot of us on Cincinnati’s startup scene kind of stand on Jack’s shoulders,” Blackshaw said.
Cincinnati now has 16 venture capital firms, 18 private equity firms and seven mezzanine capital firms, Wyant said. Before Blue Chip started, it had one total in any of those categories.
The $44 million Blue Chip started with has mushroomed to $3.4 billion in investment capital across those 41 funds.
“That’s mind-boggling,” Wyant said of the growth. “This isn’t evolutionary, it’s revolutionary.”
Blackshaw had come to Cincinnati from California in the 1990s and, after working at Procter & Gamble Co., launched startup firm Planet Feedback. Blue Chip was one of its early investors. Wyant served as an adviser to Blackshaw numerous times over the years and the two have worked together on enhancing Cincinnati’s startup scene.
“He’s indefatigable,” Blackshaw said. “Jack combines great vision with practical smarts and business sense.”
He highlighted Wyant’s love and support for the city as a key to drawing and keeping startup talent.
“Jack is such an irrepressible champion for Cincinnati,” Blackshaw said. “He’s brought investors here from all over the world.”
One of Wyant’s key traits is one Blackshaw said has been used to describe himself too.
“He’s an urgent optimist,” Blackshaw said. “He sees big possibilities and sees the value of grabbing them fast.”
Ultimately, Blackshaw said, Wyant has paved the way for the rest of the startup scene to flourish.
Wyant's 'intuitive sense'
Chris McCleary, a Blue Chip managing director, had run a Maryland-based startup Internet service provider called Digex in the mid-1990s. Blue Chip invested in it and was about to help it do an initial public offering (IPO). The market had turned and some investment bankers backed out. But Wyant helped the firm align with a smaller bank to wrap up the deal.
“I believe that was Blue Chip’s first IPO exit,” McCleary said. “That shows Jack’s perseverance and damn what the big guys say. We’re going to make it happen.”
Blue Chip made five times its original investment when Digex was later acquired.
McCleary later had a software-as-a-service firm in which Blue Chip invested. The technology wasn’t well known and there were many naysayers. Not Wyant.
“Most people said this will never work,” McCleary said. “Jack said, ‘Wait a minute. This is going to work if we can get the technology to work.’
“Jack has an intuitive sense of what will work and what won’t work.”
Wyant had a strong sense Blue Chip would work. But he didn’t know then the everlasting impact it would have on Cincinnati’s startup world.
“I did believe we were starting something,” he said. “But I did not envision anything of this magnitude.”
Wyant deflected the praise for launching Blue Chip to others. Star Bank CEO Oliver Waddell and Western & Southern Financial Group CEO John Barrett were instrumental, he said. Waddell was the first local bank leader to financially back the venture and urged others to do the same. Barrett carried enormous influence with his backing.
“Essentially those two bold decisions allowed us to raise the capital,” Wyant said.
Early on, before he began raising money, Wyant met with Rod Goldstein at Chicago venture capital firm Frontenac Co. With Goldstein’s help, Wyant mapped out a plan for Blue Chip “on the back of a pizza box,” he said.
Later, he’d sit at the the end of the counter at the Echo restaurant on Hyde Park Square and draw up a detailed plan. A waitress who still works there told Wyant recently, “I remember that. We always wondered what you were working on all those days.”
Wyant said he looks back on his role with pride.
“I don’t want to take credit for it all,” he said. “But there was a first, and it took two years of sweat and shoe leather.”
And now, at 76, he’s still managing director at Blue Chip, furthering the startup community, investing with Queen City Angels and teaching at the Salmon P. Chase Law & Entrepreneurship Center he founded. And there’s more to come.
“The bad news about a lifetime achievement award is you have to live a lifetime,” he said. “But my life plan is to live to 100, so I have 24 more years.”
