Proactive hometown company-building will cross county, state lines with Fountain Innovation Fund, ECJC leader says
February 14, 2019 | Elyssa Bezner
It’s time for Kansas City stakeholders to stop waiting for coastal companies to “save the day,” said George Hansen.
“We spend a great deal of tax dollars trying to entice companies to move here with their workforce,” Hansen, president and CEO of the Enterprise Center in Johnson County, told a crowd of about 100 gathered Tuesday for a Fountain Innovation Fund dinner. “We are rarely successful [with this tactic] and when we are, they take form as branch offices or distribution centers. We love those, but they are far from a panacea. We need resident, fast-growing enterprises. We’ve got to grow.”
The presence of large corporations does not translate to high net job creation rates for Kansas City, he added, noting that placing confidence in corporations like Cerner and Garmin as indicators of economic growth is shaky ground.
“Companies are acquired and merged with unpredictable outcomes,” he said. “New and fast growing businesses must come along to take their place, share growth, and provide a place for our kids to stay.”
Maggie Kenefake, managing director, Fountain Innovation Fund
The ECJC announced its intention to capitalize the Fountain Innovation Fund — a bi-state initiative to support Midwest startups through a $5 million evergreen fund — in early 2018. The fund is currently supported by the Ewing Marion Kauffman Foundation and the federal government, said Hansen, noting the fund accepts tax-deductible donations.
Click here to read more about the Kauffman Foundation’s new effort: a $3 million Capital Access Lab.
The Fountain Innovation Fund is expected to cross county and state lines with its investments, he added, noting its intent to fuel indirect and direct jobs in the greater Kansas City community.
“Our high-potential kids are leaving and we’ve got to reverse that trend,” he said.
Click here to read more about the ECJC’s efforts with the Fountain Innovation Fund.
The evergreen fund — which employs a model that reinvests returns from portfolio companies — is expected to provide a “continuum of capital” to entrepreneurs disadvantaged by the gap that exists between the idea stage and the Series A stage, he said. The self-sustaining fund is expected to not have to return to stakeholders or investors for a top-up, he added.
“We’ve got to close the obvious holes we have in seed capital that thwart our attempts at being the ‘Most Entrepreneurial City in America’ — which we claim we want to be,” Hansen said. “It falls on us.”
“We have a responsibility to pass success on and reach back to give a hand to the next man or woman up,” he added.
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