Ohio Capital Fund Refinancing Paves The Way for Increased Venture Investments in State’s Seed and Early Stage Companies | TechColumbus

Ohio Capital Fund Refinancing Paves The Way for Increased Venture Investments in State’s Seed and Early Stage Companies | TechColumbus

The Ohio Capital Fund (OCF) recently completed a refinancing round that will provide for additional funding for Ohio’s promising new technology companies.

OCF uses no taxpayer dollars but instead is funded by private investors by way of state-issued bonds. On June 1, the Columbus-Franklin County Finance Authority issued $159 million in bonds on behalf of OCF. The bonds are rated AA- (“very strong”) from Standard & Poors and carry with them a refundable state tax credit as a back up to fund returns.

The OCF is a fund of funds created to make investments in venture capital firms that agree to invest in Ohio-based seed and early stage businesses, with 75 percent of those investments going to funds which operate principal offices in the state. It is an integral part of the state’s technology development strategy and, although not funded by the Ohio Third Frontier, it is a strong complement to this and other statewide initiatives to make a full spectrum of capital sources available to promising young technology companies.
Since 2005 when the fund was created, it has committed $111 million to 21 venture firms, eight of which are new to Ohio, having been attracted here as a result of the OCF.

In the four years spanning 2005-2009, the OCF has invested $52 million in these 21 venture firms, which have in turn directly invested in 44 early-stage companies. Through these direct investments and co-investments, $250 million has been injected into the state’s entrepreneurial and startup community.

The $159 million financing round will be used to refinance old debt and raise new funds to invest in VC firms. Governor Ted Strickland signed an executive order approving the refinancing by the Columbus-Frankly County Finance Authority.

More information is available from The Columbus-Franklin County Finance Authority, The Bond Buyer and Business First