Cleveland venture developer JumpStart Inc. has reorganized its venture capital operations to lead Northeast Ohio's efforts to attract and raise more venture capital dollars.
The newly organized JumpStart Ventures division is adding larger Series A investments to its practice of making small pre-seed and seed investments in young technology startups, mostly in Northeast Ohio.
The ventures division also plans to more than triple its investing pace to $70 million over the next three or four years, including sometimes reaching outside of Ohio, said Ray Leach, CEO of both JumpStart and JumpStart Ventures.
In addition, JumpStart Ventures plans to raise more than $100 million for its existing and new funds during the next four years, partly by including more corporations, institutions and private investors in its fundraising efforts, Leach said.
"As the CEO of JumpStart, I am spending a lot of time trying to help our community figure out new and better ways to attract and/or raise more capital to be invested in Cleveland," Leach said.
"A big part of our ability to do that — which I wouldn't have guessed 15 years ago — is going to have to come from JumpStart," he said.
Founded in 2003 to restart entrepreneurial growth in Northeast Ohio, JumpStart started making pre-seed and seed investments in tech startups in 2005.
At that time, about half of JumpStart's investment dollars came from the state in the form of Ohio Third Frontier grants, which have evolved into loans.
"Over time, I anticipate operating funds without state money," Leach said about the evolution in his organization's investing activities.
JumpStart's plan was to prime the region's venture-capital pump with early-stage dollars to attract more private venture capital funds and investments for local startups. But venture capital activity in Greater Cleveland still is being outpaced by activity in peer cities.
For instance, Columbus, Ohio, reported $5.4 billion in VC activity in 2021 compared to Cleveland's $480 million, according to Pitchbook data.
"We have more money to invest and we're also investing in larger rounds, which means we're partnering with other entities to make those investments," said Jerry Frantz, president of JumpStart Ventures.
"So the fact that we've been at this and built partnerships and expanded those partnerships gives us more opportunities to co-invest with other entities to be competitive," Frantz said.
