Cleveland venture capital organizations JumpStart Inc. and North Coast Ventures have won $50 million in state funding to support early-stage technology companies in underserved communities and populations in Ohio.
In all, the Ohio Department of Development awarded $86 million to 11 professionally managed funds statewide through its Ohio Venture Fund and Ohio Early Stage Focus Fund on Tuesday.
The money will be invested in young companies developing technologies primarily for the health care, manufacturing and food industries.
"By directing these funds to historically underrepresented founders and tech-focused companies, we're leveling the playing field and ensuring everyone has a chance to succeed in the heart of innovation," Lydia Mihalik, director of the development department, in a statement.
A $35 million JumpStart for venture funds
JumpStart Inc. and its venture capital division JumpStart Ventures have been awarded $35 million in state funding — by far the largest amount won by any organization during the state's latest funding round.
The Cleveland venture developer was awarded $10 million for its Ohio Life Sciences Fund, which is led by JumpStart Ventures in partnership with Case Western Reserve University in Cleveland. The life-sciences fund will focus on investing in Ohio-based small-molecule drug, gene or cellular therapy, protein therapy, therapeutic medical device, surgical imaging, digital therapeutics and clinical diagnostics companies.
JumpStart Ventures was awarded $10 million for its Next Fund III, which invests exclusively in Ohio-headquartered companies developing software applications for business, health care and medical technology. The fund's secondary technology areas are sensors, electronics and advanced materials. Next Fund III also will provide its portfolio companies with growth services and resource connections.
JumpStart Ventures was awarded $10 million for its Evergreen Fund IV, which will focus on investing primarily in software applications for business, health care and medical technology, with advanced manufacturing as a secondary focus area.
And JumpStart Ventures was awarded $5 million for its Focus Fund II, which helps accelerate access to capital for Ohio pre-seed and seed-stage technology startups founded, led by or serving communities of color. In partnership with Lockstep Ventures, the early-stage VC fund will invest primarily in software applications for business and health care as well as medical technology, and secondarily in scalable consumer technology companies.
North Coast nabs $15 million for new funds
Early-stage venture capital fund North Coast Ventures in Shaker Heights has been awarded $15 million to launch two new funds that will focus on investing primarily in business-to-business (B2B) software-as-a-service companies. Both funds will be open to co-investments from North Coast's angel investor network.
The Acceleration Fund III has been awarded $10 million for investing in companies once they reach $1 million in recurring revenue. The fund will aim to accelerate early-stage companies to their Series A funding round and is expected to launch in the second quarter.
And Seed Fund V has been awarded $5 million. The seed-stage fund will invest primarily in young B2B software companies and is expected to launch in the third or fourth quarters after the organization's Seed IV fund is completely invested.
"The state awards meaningfully increase the size of our funds, making [North Coast Ventures] better able to compete for and attract the highest potential startups," said Todd Federman, managing director of North Coast Ventures, in an email.
