Tag » CAPCO Programs

Panel Sees Opportunity for State-Financed Bonds to Boost Investment in Start-Ups

Wisconsin’s CAPCO Program, which began in 1998, provided investments quickly to state-certified companies:

Wisconsin has done a good job assembling pools of angel investors with deep pockets to fund nascent companies here in the Badger State.

When it comes to raising additional money to back start-ups as they begin to grow, however, Wisconsin has fallen behind its neighbors.

But the state may be poised to create a so-called “fund of funds” worth between $100 million and $500 million – possibly backed by state-financed bonds – a panel of experts said Tuesday at a Wisconsin Technology Council luncheon.

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EnviRelation Wins Business Plan Competition, Secures $100,000 Investment via the District’s CAPCO Program

EnviRelation will be expanding its business with the $100,000 investment it was awarded from winning the DC Business Plan Competition:

EnviRelation, a District-based environmentally sustainable food composter and winner of the 2010 Washington, DC Business Plan Competition, today secured an investment of $50,000 from Advantage Capital Partners and $50,000 from Enhanced Capital Partners via the District’s CAPCO Program. These funds will be used to expand this young business and position it for future growth.

“We appreciate the recognition and support that this investment brings to our innovative company. This exciting opportunity to grow our business would not have occurred but for the Washington, DC Business Plan Competition and the District’s small business investment tax credit program, known as CAPCO,” said Walker Lunn, Founder and CEO of EnviRelation. Lunn continued, “Working capital from commercial banks is not readily accessible for small but fast-growing companies like ours, and the District is fortunate to have a CAPCO program that it is specifically designed to provide access to capital to District-based businesses in need of funds to grow.”

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Quiet Quarter Reported for VC Finance

SOMS Technologies has worked with Advantage Capital Partners for two years through the state’s CAPCO program:

The second quarter was a quiet one for venture capital finance in Westchester, with only several companies reported as tapping into $4.58 million in funding.

More than half of it, $2.65 million, was raised by a single company – SOMS Technologies L.L.C. of Valhalla, according to the quarterly MoneyTree Report released by PricewaterhouseCoopers and the National Venture Capital Association, using data from ThomsonReuters.

SOMS Technologies raised the $2.65 million in a Series A venture round co-led by Advantage Capital Partners and Rand Capital Corp., with several individual investors.

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DC Small Businesses Recognized, Celebrated

EnviRelation was this year’s winner of the Business Plan Competition:

A $100,000 Prize and an inspiring keynote address headlined the 3rd Annual Small Business Awards today sponsored by the Washington, DC Economic Partnership (WDCEP).

Andrew Florance, Founder, Director, President & CEO of CoStar Group, Inc , the soon to be District-based real estate information leader, delivered the program’s stirring keynote address before an audience of 170 business and political leaders.  Florance spoke about the importance of this city as both a place to foster small business and leverage the federal nexus. Florance was introduced by Deputy Mayor Valerie Santos who praised his commitment to DC.

The presenting of the $100,000 Business Plan Competition Prize was the capstone of the morning program as EnviRelation, a local food waste recycling company, took the stage as this year’s winner.  In addition to being eligible for a $100,000 CAPCO investment, EnviRelation will receive $10,000 in pro-bono legal advice from Venable, LLP.  EnviRelation follows in the footsteps of the 2009 Business Plan Competition winner, Affinity Lab, who used the investment to open a second shared work space venture.

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Time for Wisconsin to Invest in Innovation

Wisconsin’s CAPCO program has been one of the many ideas for economic growth within the state:

The Wisconsin Technology Council will publish a new set of white papers this month including bold ideas to stimulate venture capital investment in the state.

Inevitably, some may question Wisconsin’s ability to afford these proposed programs. But the better question is whether we can afford not to pursue new ideas as we try to transform the economy.

We have no shortage of innovations. We have one of the world’s greatest research universities, one that became increasingly entrepreneurial in the 1990s. The Wisconsin Alumni Research Foundation began accepting equity in lieu of upfront fees for University of Wisconsin-Madison spinoffs at that time and began investing directly near the end of the decade. Initiatives such as the Burrill Business Plan Competition helped to create a more entrepreneurial culture.

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Houston Firm Cracks CAPCO Club

Dennis Murphree of Murphree Venture Partners in Texas participated in the state’s CAPCO Program in 2002:

Venture capitalist Dennis Murphree has joined a small band of fund managers in the country who participate in a little-known but rapidly expanding program called CAPCO.

A handful of states have passed legislation to create programs called CAPCO, an acronym for certified capital companies. These programs spawn investment funds, some as large as $175 million, that are designed to spur economic development.

The program itself is complicated, but it wasn’t difficult for Murphree and his partners to decide they wanted to be involved.

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Wisconsin CAPCO Program Overwhelmingly Successful

A report discussing the success of Wisconsin’s CAPCO Program was recently released by a professor at the University of Wisconsin-Madison:

The National Coalition for Capital, a non-profit nationwide coalition of supporters of public policies that promote access to capital for small businesses, today announced the release of a report detailing the success of the Wisconsin Certified Capital Companies (CAPCO) program. This program encourages the flow of investment capital to promising companies located in the state, creating and preserving good jobs, and generating significant state tax revenue.

In the newly issued report, Professor Donald A. Nichols of the University of Wisconsin-Madison conducts an analysis of the Wisconsin program, which was enacted in 1998.

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Defunct Investment Program for Fledgling Firms Paid Off in Big Way

Wisconsin’s CAPCO program expired in 2009, but it provided excellent job growth:

A program that used state tax credits to invest in promising Wisconsin technology businesses has paid for itself several times over, according to a study by Donald Nichols, UW-Madison emeritus professor of economics and public affairs.

TomoTherapy, Virent Energy Systems, Alfalight and Cellectar are among the Madison companies boosted by the program, called Wisconsin Certified Capital Companies, or CAPCOs.

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Innovative Venture Capital Program To Bring Millions Of Dollars To Rural Colorado

The CAPCO program, which has been proven successful in several states, was awaiting to be enacted in Colorado back in 2001:

CAPCO program, which awaits governor’s signature, has spurred significant economic growth in several states and could bring same prosperity to Colorado.

The Certified Capital Company (CAPCO) program, a highly successful economic development initiative aimed at creating jobs and fueling entrepreneurial activity in Colorado, could bring at least $50 million of venture capital funding to the state’s rural and agricultural communities if signed by Gov. Owens. The program was adopted by the state legislature (HB 1097) last week.

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Was CAPCO a Political Casualty?

Back in 2000, Missouri Governor Mel Carnahan vetoed an extension of the CAPCO program despite the state’s need for funding for start-up companies:

There is a sense that senatorial politics cast a shadow over the extension of Capco funding in Missouri.

Missouri Gov. Mel Carnahan, who supported the original legislation which created the Capco program in 1997, vetoed an extension this year because he was concerned with cutting $13 million in expenses on an estimated $7.5 billion revenue projection.

Some observers speculate the governor wanted a squeaky clean fiduciary bill of health because of his political battle with incumbent Sen. John Ashcroft. Mr. Ashcroft takes special pride in his own budgeting abilities during his gubernatorial tenure.

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