Midwest Model

 

The Ohio Innovation Fund takes a new perspective on investing between the coasts which we call the “Midwest Model.” The Midwest Model takes the best of Silicon Valley principles and applies them to companies with advantages inherent to the Midwest creating a unique mix of high growth, visionary, capital efficient, globally competitive, gritty companies.

Highly Mission-Driven Teams

Startups in Ohio are deeply motivated by company mission, making their teams loyal, long-term partners in building and scaling. This intrinsic motivation decreases turnover of key talent and helps keep startups on track for ultra high growth.

Midwestern Cash Efficiency

Midwestern companies don’t believe in spending “just to spend.” All money invested in operations is carefully monitored to ensure it’s having the desired impact. With less capital raised overall and more reasonable valuations than the coasts, “small exits” are more meaningful to VC returns. Take a company in Silicon Valley that raises $100M and exits for $200M, that’s a 2x overall; now take that same company in Ohio raising $40M and exiting for $200M, that’s a 5x.

Grit and Resilience

Midwestern companies are absolutely determined to succeed and reach their highest potential. This may mean having 100 conversations with customers, partners, and venture capitalists to validate their idea, pivoting several times to find optimal product market fit, or bootstrapping until they’re ready for an institutional round. Great startups here just won’t quit, and this hard work and determination creates globally competitive companies.

Highly Selective

OIF only invests in the top 1% of deals across tech and medtech, broadly defined to include SaaS, cybersecurity, data science, tech-enabled medical devices, biopharma, cell & gene therapy, and more. This holds companies to a high bar, one that focuses our investments to a select 4-6 per year, all of the highest quality.

While OIF’s investment amount can vary significantly deal to deal, our initial check size is generally in the range of $750,000 -$4,000,000. This capital allows us to take lead positions in a majority of our investments as a significant portion of most Midwestern Series A raises. This investment size varies depending on the company’s industry, capital need, and valuation – our targeted ownership percentage coming out of a Series A is 10%.

Relationships

Beyond the capital, OIF works to build strong relationships with the leadership teams at each of our companies. We are actively involved as key board members in each of our investments. The trust we build with our founders frequently makes us the first call or text when they want advice or help on company strategy, projects, or with introductions. We invest in bold, disruptive founders, and it is our joy to work alongside them in radically transforming their respective industries/markets.

Due to our investment model, OIF will invest over 3 to 5 years into 20+ total companies. With these metrics, $1 billion in cumulative exits across the portfolio yields success; though, OIF aims to return an even higher multiple.

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    Ohio Innovation Fund

    629 N. High Street, 4th Floor

    Columbus, OH 43215

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