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JumpStart, a nonprofit based in Cleveland, Ohio, is leading the charge to support women and minority entrepreneurs. The organization has launched a $10 million seed fund, called the Focus Fund, dedicated to investing in women and minority-led tech startups. This initiative is part of JumpStart’s mission to accelerate opportunity for underrepresented entrepreneurs in Ohio and beyond.
The Focus Fund aims to invest in about 20 companies in less than three years, with each startup receiving $500,000 in funding. JumpStart will also take equity in the startups, although the exact terms of the investment were not disclosed. The catch is that entrepreneurs will have to move their headquarters to Ohio to qualify for the funding. However, they are not required to stay in the state for a specific period of time.
Ray Leach, CEO of JumpStart, believes that once entrepreneurs relocate to Ohio, they will see the benefits of being part of the state’s vibrant startup ecosystem. Ohio already has strong pockets of innovation in cities like Cincinnati, Columbus, and Cleveland, supported by top accelerators, VC funding, and angel investors. Industries such as healthcare IT, biotech, cleantech, and wearables are thriving in Ohio, making it an attractive location for tech startups.
Leach highlighted that Ohio has invested nearly $500 million in the past five years to advance its entrepreneurial ecosystem. Initiatives like the JumpStart Focus Fund, which is a public-private partnership, play a crucial role in supporting the state’s startup community. JumpStart, founded in 2005, has a track record of investing in early-stage tech firms in Ohio, with 35% of them having women or minority founders.
The lack of diversity in venture capital funding is a major issue in the U.S., with 95% of funding going to male-led startups. Leach, who is a member of the National Venture Capital Association’s diversity and inclusion task force, aims to address this disparity through the Focus Fund. He emphasized that the fund is the largest of its kind to focus exclusively on women and minority-led tech startups.
With the state of Ohio providing half of the investment for the Focus Fund, and JumpStart contributing the other half, Leach is optimistic about the impact the fund will have on the entrepreneurial landscape. He expects to make the first investment within the next 90 days and believes that the fund will not only benefit individual startups but also raise the profile of Ohio as a dynamic entrepreneurial state.
Leach hopes that the Focus Fund will serve as a model for the VC industry as a whole. He acknowledges that there is still a long way to go in embracing diversity in the industry but believes that initiatives like the Focus Fund can create a ripple effect, inspiring similar efforts across the country.
In conclusion, JumpStart’s Focus Fund is a groundbreaking initiative that aims to support and empower women and minority entrepreneurs in the tech industry. By providing funding, mentorship, and resources, the fund has the potential to drive innovation, create opportunities, and promote diversity in the entrepreneurial ecosystem. Ohio’s commitment to fostering a diverse and inclusive startup community sets a positive example for the industry as a whole.
