JEFFERSON CITY, Mo. — A statewide startup investment fund in Missouri, first proposed last summer by an innovation task force appointed by Gov. Eric Greitens, may become reality.
St. Louis Regional Chamber of Commerce officials are in Jefferson City this week to lobby for the professionally managed fund, which would be the next generation of the Missouri Technology Corporation.
“We made a lot of advances in the last couple years,” Andrew Smith, the Chamber’s vice president of entrepreneurship and innovation, said. “We want to get this going so we don’t lose momentum.
“Moving away from the MTC, the key is to get this done quickly and not to have a gap.”
Investing in startup ventures would have the biggest economic impact with the most return — early stage investments have the biggest returns — but it does come with added risk.
“This would be real investment in that state,” Smith said. “Something like 80 percent of all new jobs created are by companies that are five years or newer.”
Startup companies in Missouri are disadvantaged compared to those in California and New York and other states because they don’t have the same proximity to Capitol, according to Smith.
“There is a lot of innovation in Missouri,” Smith said. “And a lot of great ideas.”
The idea of a statewide startup investment fund came about for two reasons.
First, the severe lack funding to the MTC. In the current budget year, the Governor and the General Assembly pulled 90 percent of funding — which decreased funds from roughly $24 million in the fiscal year 2017 to $2.5 million in the fiscal year 2018.
Second, the Governor’s innovation task force asked the question, “What comes next?”
The answer was the very fund the St. Louis Regional Chamber is advocating for.
“There are some well-established models” to go off, according to Smith. Several other states have created similar programs.
And Missouri’s fund would need to be scaled to make a difference.
“We are not talking $5 million, or even $10 million, but rather $100 million,” Smith said. “I’ve even heard figures above that thrown around.”
Ideally, the investment would be made up of public and private money. The public funds could come about one of two ways: either through bond financing or the general budget.
Smith believes that bond financing would be the logical, achievable approach to getting the startup investment fund working.
Which again, Smith stressed timeliness. “We simply can’t afford to lose momentum.”