Opportunity for Tech Entrepreneurs: CincyTech Helps Turn Ideas Into High Potential Companies
Written by Robert Leitch.
There is a strong sense of pride throughout the entrepreneurial community in southwest Ohio, with CincyTech acting as a driving force in the region. Founded in 2005, CincyTech is a seed-stage investor in tech-focused startup companies, serving the six-county region of Cincinnati and surrounding communities. It’s the central hub of the southwest Ohio startup network, and provides Ohio Third Frontier funding to the region’s entrepreneurs via organizations like The Brandery, Cintrifuse and HCDC.
The CincyTech portfolio includes many fast growing startups and early stage companies that are receiving national attention, such as the precision medicine company Assurex Health, which in a few years’ time has grown from a team of five to more than 300, and was a USA Today finalist for 2014 National Entrepreneur of the Year; LISNR, an audio-based marketing platform which is ranked #12 on CNBC’s Disruptor 50 list; Akebia Therapeutics, a $100 million IPO in 2014; as well as Enable Injections, Ahalogy, ChoreMonster and Zipscene.
As of the end of 2014, CincyTech had invested $25.2 million in 53 startups in the Cincinnati region. Their portfolio companies employ more than 600 people and have received investments totaling more than $400 million.
“Before CincyTech, many tech startups in Cincinnati had trouble raising more than a half million dollars in seed capital,” said Peg Rusconi, director of communications at CincyTech. “The leaders who built CincyTech’s model found companies that are meeting milestones often need access to about $2 million to demonstrate their value proposition and grow to the point at which they can attract traditional venture capital. Our organization’s mission is to be a trusted partner in transforming ideas into high potential companies.”
The money CincyTech invests in companies is tied to mentorship from experienced entrepreneurs and is often the first financing the companies receive. In exchange for funding, CincyTech takes a seat on the board of each company, working to identify strengths and flaws in the business so that adjustments can be made for future success.
“After leading their seed rounds, we help our companies raise follow-on capital and meet their investment goals and milestones,” said Bob Coy, president and CEO of CincyTech. “We stay with all of our portfolio companies until they are either acquired or exit through an IPO.”
CincyTech was recognized nationally in 2014 with the State Science and Technology Institute (SSTI) Excellence Award for Technology Based Economic Development (TBED), in the Increasing Access to Capital category. SSTI is a national nonprofit organization that leads, supports and strengthens efforts to improve state and regional economies through science, technology and innovation. The awards recognize organizations that can serve as models for other states and regions.
“CincyTech led our seed round in 2009,” said Chris Powell, CEO of BlackbookHR, a software company focused on helping companies engage and retain employees. “They helped us identify our product market fit and build a product that was scalable.”
“We are here today because of the initial investment from CincyTech,” said Suprasanna Mishra, co-founder of Capstory, a startup that compiles event photos and creates an interactive experience for guests and hosts. “We used that money to build our prototype so that we could showcase our concept. CincyTech advisors helped refine our pitch to investors and gave us invaluable marketing and sales advice.”
In the years since CincyTech began investing in startups in 2007, the southwest region of Ohio has become a hub for entrepreneurs. Combined with other Ohio Third Frontier partners like The Brandery, Cintrifuse and HCDC, people building startups in the area have an extensive network of mentorship and funding opportunities at their fingertips. The passion among entrepreneurs in the Cincinnati region is electric, and CincyTech’s desire to see its portfolio companies succeed serves as a model for other successful seed funds throughout the Midwest.
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