The investment money comes from a $13.2 million federal allocation. Anchorage is the first city in the U.S. to receive an allocation from the Treasury Department’s state small business credit initiative, according to the mayor’s office. Elsewhere, states are operating such funds.
The Anchorage fund, called the 49th State Angel Fund, will loan money or take an ownership interest of up to 10 percent of the value of enterprises it invests in, said Allan Johnston, a former investment firm manager who is helping the city put the fund together. He is married to Assembly member Jennifer Johnston.
The fund’s purpose is to spur economic development, create jobs and promote entrepreneurship, city Chief Financial Officer Lucinda Mahoney said in a written presentation.
Exactly how the program will work is still being developed, Allan Johnston said. Eventually, he said he thinks the best system would be for private “angel funds” to be established and for the city money to go through them.
But in the initial version, the mayor and the city’s chief financial officer will make decisions on which businesses to invest in based on recommendations from an advisory committee of financial experts.
The Anchorage Assembly unanimously approved the plan last week.
Anchorage Assemblyman and mayor candidate Paul Honeman sent out a campaign statement critical of the way the fund management is set up. He thinks the Assembly should have a role in confirming advisory committee members and maybe confirm who gets loans.
But he said Friday that he voted for it without proposing any changes because he didn’t want to jeopardize Anchorage getting the money.
He noted the city has 90 days to set up the program and says there’s time within that period to make changes.
Assembly member Patrick Flynn, in his blog, questioned whether it would be a good idea for the Assembly to be more involved. “We want to substitute our political judgment for the fiscal judgment of financial professionals?” he asked.
Bill Popp, president and CEO of the Anchorage Economic Development Corp., said his group supports the city’s move.
“Angel funds” such as this one fill gaps in the financing of a new or expanding business, Popp said. Such funds tend to be small and community based, he said.
“AEDC is pretty excited this fund is coming into being,” he said.
Popp told the Assembly it “fills a role the private sector has not been willing to take on to this point.”
Strings attached to the federal funds:
• There has to be a 10-to-1 match for the federal money. A $1 investment from the 49th State Angel Fund must lead to at least $10 of private funding, the city news release said.
So the $13.2 million in federal money could generate $140 million or more in economic activity, Popp said.
• The target investment is a firm with 500 or fewer employees. Seven hundred fifty employees is the upper limit.
With these requirements, it won’t be for mom-and-pop retail outfits, Popp said. The start-up or expanding business venture would have to have a sizable investment, he said. Asked what kinds of businesses might qualify, he said a company making high-value electronics might, or an information technology firm with significant reach.
Lance Ahern, now a city employee, testified at the Assembly that when he started Internet Alaska Inc. in 1994 investment money was scarce. The company was the first local and statewide Internet service provider in Alaska, Ahern said.
He wasn’t able to get bank loans. “When I started my first company the investors were me, Visa and Mastercard,” he said. “This program is really good.”
Reach Rosemary Shinohara at rshinohara@adn.com or 257-4340.
http://tourism9.cm/ http://vkins.com/
The Anchorage fund, called the 49th State Angel Fund, will loan money or take an ownership interest of up to 10 percent of the value of enterprises it invests in, said Allan Johnston, a former investment firm manager who is helping the city put the fund together. He is married to Assembly member Jennifer Johnston.
The fund’s purpose is to spur economic development, create jobs and promote entrepreneurship, city Chief Financial Officer Lucinda Mahoney said in a written presentation.
Exactly how the program will work is still being developed, Allan Johnston said. Eventually, he said he thinks the best system would be for private “angel funds” to be established and for the city money to go through them.
But in the initial version, the mayor and the city’s chief financial officer will make decisions on which businesses to invest in based on recommendations from an advisory committee of financial experts.
The Anchorage Assembly unanimously approved the plan last week.
Anchorage Assemblyman and mayor candidate Paul Honeman sent out a campaign statement critical of the way the fund management is set up. He thinks the Assembly should have a role in confirming advisory committee members and maybe confirm who gets loans.
But he said Friday that he voted for it without proposing any changes because he didn’t want to jeopardize Anchorage getting the money.
He noted the city has 90 days to set up the program and says there’s time within that period to make changes.
Assembly member Patrick Flynn, in his blog, questioned whether it would be a good idea for the Assembly to be more involved. “We want to substitute our political judgment for the fiscal judgment of financial professionals?” he asked.
Bill Popp, president and CEO of the Anchorage Economic Development Corp., said his group supports the city’s move.
“Angel funds” such as this one fill gaps in the financing of a new or expanding business, Popp said. Such funds tend to be small and community based, he said.
“AEDC is pretty excited this fund is coming into being,” he said.
Popp told the Assembly it “fills a role the private sector has not been willing to take on to this point.”
Strings attached to the federal funds:
• There has to be a 10-to-1 match for the federal money. A $1 investment from the 49th State Angel Fund must lead to at least $10 of private funding, the city news release said.
So the $13.2 million in federal money could generate $140 million or more in economic activity, Popp said.
• The target investment is a firm with 500 or fewer employees. Seven hundred fifty employees is the upper limit.
With these requirements, it won’t be for mom-and-pop retail outfits, Popp said. The start-up or expanding business venture would have to have a sizable investment, he said. Asked what kinds of businesses might qualify, he said a company making high-value electronics might, or an information technology firm with significant reach.
Lance Ahern, now a city employee, testified at the Assembly that when he started Internet Alaska Inc. in 1994 investment money was scarce. The company was the first local and statewide Internet service provider in Alaska, Ahern said.
He wasn’t able to get bank loans. “When I started my first company the investors were me, Visa and Mastercard,” he said. “This program is really good.”
Reach Rosemary Shinohara at rshinohara@adn.com or 257-4340.
没有评论:
发表评论