After months of delay, the Ohio Third Frontier Commission last week released much-needed funds to support Northeast Ohio entrepreneurs. JumpStart, the nonprofit that coordinates funding in the region, received $12 million for two years, a slight increase, most of the additional money going to new collaborators, among them the Austen BioInnovation Institute in Akron.
That’s good news as the region continues to rebuild its economy, in part, via public investments in new technology. Still, comments from commission members indicated growing impatience with a broad array of new ventures getting support. Mark Kvamme, the California venture capitalist appointed to the commission by Gov. John Kasich, favors more dramatic results, dollars directed to fewer entrepreneurs, to those ready to scale up operations rapidly, to have “a huge impact.”
This big-project mentality (Kvamme has said, for example, he wants Ohio to land the next Groupon) would, if successful, surely spur job creation and attract more venture capital to Ohio.
The concern is, Kasich, Kvamme and their allies are pushing the Third Frontier program in a direction that diverges sharply from its original purpose of fostering a wide-ranging network of entrepreneurial activity, one that would aid in the long-term transformation of Ohio’s economy.
In other words, the Third Frontier was intended to follow a different model than a venture capital firm. Instead of looking for relatively quick results, the Third Frontier was designed to sustain early-stage research and development efforts from which the private sector often shies away, the payoff likely too far in the future.
Another potential difficulty is political interference, governors looking ahead to re-election and wanting to highlight something concrete. Great care was taken under the administrations of Bob Taft and Ted Strickland to insulate the Third Frontier from short-term political pressure. Republicans, especially, voiced concerned, warning about Strickland and his Democratic allies.
By many measurements, the results in Northeast Ohio have been impressive, 30 percent of the statewide funding for entrepreneurial programs yielding 56 percent of the outcomes in jobs and investment. The original goal of the Third Frontier program remains sound, the state playing the vital role of helping to build a new base of creativity, the result a more diverse, vibrant and sustained economy for Ohio.