MassVentures Starts New $5 Million Early-Stage Fund

(A. Kotok)

MassVentures, Massachusetts’s venture capital agency, unveiled a new $5 million fund for early stage technology companies. The organization had been known, up to yesterday, as the Massachusetts Technology Development Corporation.

The new MassVentures financing will be managed through the Massachusetts Emerging Technology Fund of MassDevelopment, a state economic development agency. The Emerging Technology Fund makes or participates in loans of up to $2.5 million and loan guarantees of $1 million. Borrowers must be a technology company starting or expanding manufacturing operations in Massachusetts.

The new MassVentures fund aims to fill financing gaps in emerging sectors not adequately served by traditional venture capital companies, first-time entrepreneurs, and companies transitioning from initial seed (start-up) to series A funding. MassVentures says it expects to invest in four to seven new companies each year.

At the end of April, the organization announced the SBIR Targeted Technologies (START) program that supplements federal Small Business Innovation Research (SBIR) awards with grants of $100,000 to $500,000. Massachusetts is traditionally one of the largest recipients of SBIR grants. Life sciences and energy/cleantech companies are not eligible for this fund, since they are covered by other state initiatives.

MassVentures started as the Massachusetts Technology Development Corporation in 1987 as a quasi-public corporation, with an independent board of directors, and managed by experienced venture capitalists. The Boston Globe quotes MassVentures’ president Jerry Bird that the group changed its name to prevent confusion with other organizations in the state with similar initials.

Read more:

• Venture Fund Raises $50M for Cleantech, Materials Start-Ups
• $525M Venture Fund to Back Tech, Science Companies
• Merck Investing in Life Sciences Venture Fund

*     *     *