BEAVER CREEK, Colo. — Governor John Hickenlooper (D) revealed in a private meeting with the press that Colorado is backing a new venture fund.
Hickenlooper admitted that a lack of venture funding is a big issue for Colorado startups. So he asked local business leaders, including TeleTech founder Ken Tuchman, to pour their personal wealth into a fund. The $150 million fund, of which $100 million has already been raised, is reserved for Colorado-based startups.
The state will also be a limited partner in the fund with money from its retirement program.
“Government doesn’t have a high tolerance for failure,” Hickenlooper said. “So we’ll be doing some seed funding, but it could also be mezzanine rounds.” He revealed that the fund’s legal structure has already been drafted, and they plan to announce it in the summer.
This isn’t the first time that the governor’s office has been involved in venture funds. Colorado’s High Country Venture has a $50 million fund for early-stage startups, and the state has been a limited partner for several years.
According to High Country Ventures’ Chris Marks, a board member from the local Venture Capital Association (VCA) has been contacted for help setting up this new fund.
The relationship between government and local venture funding isn’t always smooth. The state hopes that funding tech startups will create jobs and stimulate the local economy. Meanwhile, investors are focused on bringing solid returns to their shareholders.
Still, it’s a great boost for the local tech market in Colorado, which competes with burgeoning hubs like Austin and Seattle.
“When I got elected, we looked our our economic development program, said Hickenlooper.”People wanted less red tape and better training, but access to venture capital came up all over the state.”
Top image via Change.org