The Milwaukee Regional Innovation Center has formed an angel fund to invest in Wisconsin startups.
MRIC, which manages the Milwaukee County Research Park and its Technology Innovation Center business incubator, has contributed $100,000 to the fund, and has applied for a matching grant from the Wisconsin Economic Development Corp.’s Capital Catalyst Program for another $100,000.
The MRIC created the fund to help spur additional entrepreneurial activity in the state, said Guy Mascari, chief executive officer of MRIC and executive director of the TIC. MRIC is forming an investment committee, and plans to coinvest with other angel individuals or groups to fund early-stage startups, contributing $10,000 to $20,000 per investment.
Mascari is focused on startups that have developed a product that is ready for commercialization in the information technology, medical products and devices, agribusiness, food processing, automation and machinery industries, he said.
The MRIC’s TIC is at its highest-ever occupancy, 85% full with 60 tenants, about two-thirds of which are startup companies, Mascari said. But it also is home to anchor tenants and support organizations.
“I’ve always believed that where a startup locates is really important,” Mascari said. “You’ve got enough headaches running your business and getting it up and running to have to deal with parking or long commutes for yourself and your employees.”
He sees the angel fund as one more avenue to help startup companies in the area. MRIC joined Milwaukee angel group Silicon Pastures, a TIC tenant, a few months ago.
“Having been here 24 years and seen all these startups, it’s a really exciting business to be in, working with entrepreneurs,” he said.
MRIC has a quasi-endowment from the sale of some of its land that allows it to operate as a nonprofit, Mascari said. It charges flexible rent prices based on a company’s maturity. But this angel fund is part of a comprehensive investment policy the organization set up last month. MRIC also has a revolving loan fund and a research development fund.
“Even if we would make profits on some of these investments…that might cover a projected deficit for a year or so,” Mascari said. “An important idea of this and I think one of the things my board was happy about…is Silicon Pastures is not philanthropy. We’re not doing this just so we can feel good and say we’re investing in a promising startup company.”
He recognizes the returns on the MRIC angel fund may take years to materialize, so Mascari doesn’t plan to fully invest it until returns start coming in, to ensure its sustainability.
