Slater Technology Fund is waiting patiently - but still waiting – for the bulk of $9 million in federal stimulus crucial to its transformation from a state-funded investment vehicle to a self-sustaining, venture-capital firm.
The money is part of a $13.1 million federal grant to Rhode Island first announced in 2010, of which only $4.3 million has reached the Ocean State so far.
The second tranche of the grant, of which Slater was set to receive $3 million, was first slowed by the state Small Business Loan Fund struggle to find borrowers for its portion of the money.
Now state economic-development officials who manage the grant are conducting an unspecified review of the program before applying for the second tranche of funds.
R.I. Economic Development Corporation spokeswoman Melissa Chambers declined to offer any details of what was being reviewed, what had changed in the last four months to prompt the review or when, if ever, the second tranche might arrive.
“We’re doing our due diligence,” Chambers said.
In the absence of the federal money, investments in Rhode Island companies Slater has in its pipeline are being held up, said Slater Managing Partner Richard G. Horan.
“There is no doubt there are compelling ventures that warrant continued Slater support, where we are having to refrain from moving ahead pending receipt of additional funding,” Horan said. “At some point it becomes a delicate balancing act, because our strategic operating plan is built on $9 million in this and next fiscal year.”
So far Slater has received $1.9 million from the federal grant, including the planned $1.5 million initial installment and an additional $400,000 advanced from the Small Business Loan Fund out of the pool it couldn’t find takers for.
Slater’s anticipation of new cash comes as the pace of venture investment, mergers and acquisitions accelerates nationally and several companies in the fund’s portfolio are raising significant private capital.
Since September, three Slater-backed companies have raised a combined $82 million: IlluminOss Medical raised $28 million in a Series C round; Medrobotics, raised $34 million in a Series D round; and NABsys raised $20 million from a Series D round.
That $82 million in nine months compares with $394 million Slater-backed companies raised in the 15 years between 1997 and last April.
PBN is now accepting applications for its newest award program and event for RI & Bristol County to celebrate the Manufacturing Renaissance that is evolving regionally and across the country. The deadline for applications is March 20th.
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