inspired by ohio third frontier, national group relocates offices to lorain county community college
The historic factory town of Elyria, Ohio is perhaps not the most likely place to start a tech revolution, yet something radical is happening on the campus of Lorain County Community College
, located just 30 miles west of Cleveland. A group of organizations here are trying to attract new forms of capital to this manufacturing town and others across Ohio.
In a glassy, new office building tucked into the trees at the edge of campus, a brain trust of innovation gurus is studying how to attract more venture, seed and early-stage capital to grow startups across Ohio. The programs they’re developing at the Entrepreneurship Innovation Center
could not only attract more capital from the coasts to Ohio, but also help average Ohioans invest in the state’s future.
These days, there are plenty of classes that teach people how to be successful as an entrepreneur, yet what’s rarer are courses in becoming a savvy investor. Although the Jumpstart Our Business Startups (JOBS
) Act recently signed into law by the Obama administration will open up equity-based crowdfunding to investors, no coursework exists to guide them towards making good decisions.
Jim Jaffe, President and CEO of the National Association of Seed and Venture Funds (NASVF
), a nonprofit group with 200 member organizations that recently relocated to the Innovation Center, has set his sights on filling that gap in the marketplace.
“In terms of the money that’s available for venture capital, Ohio ranks very high,” says Jaffe, who managed several companies before taking the helm of NASVF. “Yet the question is – if you have money, how do you attract more money? That’s where Ohio and cities like it get dwarfed by Silicon Valley, New York or Massachusetts.”
By moving to Ohio, NASVF hopes to play a role in attracting new investment while also educating Ohio investors who are seeking to become involved. Jaffe views Ohio Third Frontier
as a model statewide program for fostering investments in technology and innovation, and he hopes to spread its model to other areas.
The organization moved into the Innovation Center at LCCC earlier this year, and it will eventually employ at least four people there. NASVF’s leaders had always admired the Ohio Third Frontier initiative, and after being recruited by state leaders, it was deemed a good fit.
“Third Frontier felt that having an international organization in Ohio would help brand it as a place where innovation capital and investment are in the forefront,” says Jaffe. NASVF’s members include equity funds, state and regional economic development agencies, and technology groups like university research offices.
The entrepreneurial activity at LCCC was a crucial part of what attracted NASVF to the campus. “About a year ago, I met [LCCC President] Roy Church and was really blown away,” says Jaffe. “I had no idea that a modest-sized community college most folks probably hadn’t heard of was at the forefront of innovation.”
Although community colleges are better known for offering workers a foothold in the knowledge economy than actually propelling innovation forward through capital investments, places like LCCC are changing that, Jaffe says.
“It’s no longer just the MIT’s and Stanfords. Community colleges are a path or a guide to what’s happening in innovation and technological advancement in Ohio. They’re helping to connect the community to what’s happening in these areas.”
The Innovation Center at LCCC is also home to the Innovation Fund, a $5 million pool that provides venture capital investments to budding entrepreneurs, and the Great Lakes Innovation and Development Enterprise (GLIDE
), offering entrepreneurs resources, tools and advice to help grow their businesses.
“LCCC has adopted the notion that innovation is going to be the key differentiator for any community to grow and prosper in our global knowledge economy,” says Tracy Green, Director of the LCCC Foundation
. “To transform from our industrial roots and compete globally, need to foster and instill entrepreneurship.”
NASVF is a natural fit with LCCC’s mission of helping entrepreneurs because attracting follow-on funding has been a challenge for many startups, she says.
“The funding gap really exists after entrepreneurs reach out to friends and family and exhaust their credit cards and second mortgages. We want to get on the radar screen of investors, and what better way than having NASVF in our backyard?”
Later this year, NASVF plans to launch an initial course in how to be a successful investor. The class will be geared in part towards the smaller investors who are interested in equity-based crowdfunding (SEC rules will be finalized by 2013).
NASVF will also help LCCC to spread the success of its $5 million Innovation Fund. Jaffe says that the group will develop educational programming around this model, adding that he hopes to replicate it at other colleges and organizations statewide.
Over time, Jaffe also hopes that NASVF will develop college-level coursework that helps students better understand what it means to become a smart investor.
NASVF is also bringing its annual conference
to Cleveland from October 15th
. It will showcase the successful entrepreneurial ecosystem that exists statewide. A few of the well-known speakers will include Steve Case, former CEO of AOL.com, and Chuck Templeton, who is founder of the online reservation site Open Table.
Ohio Third Frontier plans to organize its annual Ohio Venture Fair conference directly following the NASVF conference. “We’re going to encourage investors to stay over another 24 hours to learn about the emerging companies in Ohio looking for their next round of funding,” says Lisa Delp, Executive Director of Ohio Third Frontier. “The goal of our partnership with NASVF is to form new relationships with out-of-state investors and to draw new capital to Ohio.”
Third Frontier will partner with NASVF to roll out online courses to help Ohioans become savvy investors in some of the state’s burgeoning startups. The state-of-the-art distance learning technology at LCCC is crucial to the effort, and yet another reason why NASVF chose the Innovation Center for its new offices.
If these efforts bear fruit, local residents will soon have the training that they need to invest in the next potential big thing -- and keep their money right here in Ohio.
Photos submitted by Lorain County Community College.
1. Richard Miller and Jim Jaffe of NASVF.
2. Steve Mercil and Jim Jaffee of NASVF.
3. Tracy Green of LCCC Foundation.
4. Interior of Innovation Center
5. Interior of Innovation Center.
6. Exterior of Innovation Center.